Money FlowMo (Energy-Other)

Michael Davey with more on money flows.

While that line may not excite the room, it’s how a trader trying to participate in the champagne twilight of a move higher will pinpoint the better risk/reward candidates (theoretically then being aboard the brighter end of the roman candle while the arena still remains lit).

This chump anyway.

Today I’m highlighting the Energy-Other group. While this group was already hot late in 2009, it is steadily rising higher (in term of relative strength RS) this week. And again, the first week of January tends to paint a rough picture for January as a whole, so I am keen to spot where money is flowing early into January.

Of 197 industry groups tracked by Oneil’s database, the Energy-Other group has risen from a 23-rank at the year-end, to a 12-rank coming into today.

Here is a current daily-chart of the group and a list of the higher-scoring names within the group.

Like yesterday, most of the higher-ranked names within the group are over-extended (so even though they are more powerful it is difficult to justify entering here, as there is no adequate benchmark for some miles below).

I’m going to pin-point APWR though, as it is higher-ranked (within the group), it is not terribly extended and, importantly, it is Chinese.

APWR may be a great investment, or it may be a lovely long-term short. I don’t care either way. This week, however, if the market keeps its bid, it’s a long I’d be willing to lean on.