The S & P 500 contains 165 more stocks than the IGVSI, but less than half are Investment Grade Value Stocks. Although it is more broad based, it is also more speculative, and has not done as well as the DJIA. Still 14.7% below the 2007 high, it would need to gain another 17.2% just to claw back to its 2007 level.
To most investors, the DJIA provides all of the information they think they need, and they worship it mindlessly, thinking that this time tattered average has mystical predictive and analytic powers far beyond the scope of any other market number. It's Wall Street's rendition of 'The Emperor's New Clothes'.
I doubt that many traders would argue that the crude oil market in 2010 proved to be a tough commodity sector to get any real feel for the trend and direction. 2010 just did not produce any discernible, lasting trend in the oil market. The trends it has produced have lasted little more than just 3 or 4 weeks at best.
So what's next for crude oil traders in 2010 and into 2011?
On Aug. 12, volatile market action coincided with a technical signal called the Hindenburg Omen, whereby a relatively high number of new highs and lows in individual stocks occur at the same time.
