Wednesday, August 29, 2012

T 3 Momentum Tool...8.29.12

As mentioned on Monday, this matrix is the basis of the Situations T 3 momentum calculations.  The tool combines both daily momentum signals with real time data to quickly examine both the individual performance of each component and the performance of each component relative to the larger portfolio.  This is, of course, the TC2000 platform and while it looks a lot like the platform (also a Worden Bros. product), there's a lot of custom programming possible in TC2000 that cannot be accomplished in FSC.
That's not a solicitation for TC2000, just a notice that they are different products.

The MOSAIC tab reflects a custom daily bar momentum indicator, while the T3 and T7 tabs reflect real time relative strength  (shown in 10 minute bars on this chart).  T3 greater than T7 for a component indicates increasing relative strength while the +3 thru -12 tabs rank current strength and momentum relative to the past 12 days.

In today's case XLV is showing strength relative to the rest of the pack while still showing weakness per the +3-12 scale.  The resolution of those conflicting readings is therefore a neutral position in the ranking scale
This same analysis could be applied to XLU and XLP with minor adjustments and tomorrow we'll look at why this alignment is important when looking at the larger context of the portfolio.