I just read Andy’s post about the High RS Diffusion Index. My first reaction was, “Wow, that’s a really low number!” My second reaction was, “Good God, what’s still above its 50 Day Moving Average from that universe?”
The list of securities is short:
- Green Mountain Coffee Roasters (GMCR)
- Southern Union Co (SUG)
- Timberland Co (TBL)
Southern Union and Timberland have held up well because they are buyouts. That leaves Green Mountain as the only true company from the universe above the 50 Day MA on its own merits. I don’t think that really means much for GMCR. I think it just shows how incredibly washed out this market is right now. The “real” number rounds down to zero!
Disclosure: Dorsey Wright Money Management has positions in GMCR in a number of different account styles.
