Money Flows

Here's what our money flow analysis is saying.

Stocks trading above their 200 day moving averages has now fallen to 48%.  This is oversold in the context of the past year or so but is nowhere near absolute low levels.  For comparison sake, this indicator fell to a low of 11 back in August of 2011 which by the way was around the last time we had a debt issue crisis.  

Stocks trading above their 40 day moving averages comes in at a reading of 52%.  This is at best neutral.

Our main readings of money flows into and out of stocks have finally turned negative but are not yet at oversold levels that typically signal a tradable intermediate bottom in stocks.

Short term sector readings have retreated from overbought levels to a more neutral stance.

Our shortest term money flow indicator is neutral as well.

The S&P 500 is now down 10 of the last 13 trading days and has lost a bit over 5% in value as of yesterday.  That move however has to be put in context.   There was a big  spike higher on September 18th when the Federal Reserve announced it's no "Taper" policy.  If you take away that spike then stocks are down about 2% and have fallen back into the trading range we've seen since April.  Stocks are now in essence trading flat with where we've been since May.  

So far it looks as like we've been correcting more by time than price.  Will have to see if that holds up the longer the Government shut down stays in effect and the closer we get to a debt default.

*Long ETFs related to the S&P 500 in both client and personal accounts.