Chapter X: The mood of the market toward Martha Stewart show up in the Daily Closing Altitude and other Sentiment Indicators. |
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| Negative Volume Index (NVI) is a traditional Sentiment Indicator for Martha Stewart. This version is includes several enhancements suggested by Norman Fosback. The plot is the proportion of the daily NVI as compared to the past year's average daily NVI. The plot is orange below the unity line (neutral implication) and green above (bullish). |
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What to look for in an NVI plot for Martha Stewart: The NVI is an elegant indicator based on sound principles but it should not be interpreted in a simplistic manner. The orange plot (NVI less than unity) is not considered bearish because a lowering of the NVI is a natural tendancy under many market conditions. When the plot is in the green area, it indicates that prices are rising on low volume sessions, which is contrary to the normal condition. This can be a tip off to "accumulation behaviour" on the part of someone or some group in the market. The indicator seems most significant when prices are falling and the NVI is rising, which indicates a market that is "buying on the dips". |
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| Because the NVI operates over a somewhat longer time frame than most technical indicators, it is of interest to track it over a longer period to get a feeling for how it works. This chart for Martha Stewart covers the few years before the start of the chart at the top of the page. |
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| The historical Closing Altitude is traced by the blue line above. For the trading week ending 6/19/2009, the weekly average closing altitude was 32.50 percent. 50 percent closing altitude is marked as the midline. If the closing prices happened to be exactly halfway between the high and low, they would be plotted on this midline. Values above the midline indicate that day traders have positive feelings toward MSO while traces below the midline are a sign that speculators are afraid to hold on to the issue overnight. The short-term trend is positive, with a slope of 51.67. Martha Stewart stock prices are shown in red. |
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| The Volume Portion is low for the latest data at 0.59. Here the blue indicates the proportion between Up Volume and Down Volume. Again, the horizontal blue line represents the neutral point. Martha Stewart share prices are overlaid in red. This is an important indicator for market timing, as a change in direction of the volume line may happen before the price turns.The last tic shows an uptrend in the volume portion of 1.66. |
Influence of Investor Sentiment on MSO stock prices. Also, roadmap and Summary of most effective indicators: |
| Wednesday, July 01, 2009: We have news on Public Service Enterprise Group Inc., ticker symbol PEG. Signs of an over-bought condition have become noticable. Also, there are breaking events concerning The Travelers Companies, Inc. and Kellogg Company. From the News Archive: (7/1/2009 ) Favorable events happened at Allegheny Energy, Inc., Bank of America Corporation, and American International Group, Inc.. Meanwhile, bad news came from Lexmark International, Inc.. |