Quick Charting Dow Jones Stock Performance in a Simple Grid

Mar 6, 2014: 2:02 PM CST

Swing traders often rely on relative strength when selecting stock candidates to trade, as stocks that are strong tend to get stronger while stocks that are weak tend to get weaker.

Let’s take a quick look at all the Dow Jones Index’s 30 stocks on a annual percentage comparison basis and highlight the current winners and losers in the index.

Dow Jones Industrial Average 30 Stocks Annual Percentage Chart Grid

The chart above shows all 30 Dow Jones stocks (blue) on a percentage chart starting with January 2, 2013.  The comparison highlights a year’s performance plus two months of 2014.

The red line is the Dow Jones itself and we can simply view the price performance of the stocks (I kept the chart as clean as possible and did not include symbol names).

I also highlighted the January 2014 decline to note the (almost) across-the-board decline in the Dow stocks for a point of interest.

The main highlights of the chart – beyond visualizing the Dow Jones Index with its moving parts over the last year – are the top and bottom (best and worst) percentage gains (or losses) from component names.

So far, Bank of America (BAC), Disney (DIS),  American Express (AXP), Nike (NKE), and Dupont (DD) comprise the “Best of the Dow” list.

Here’s a chart of current relative strength (percentage) leader Bank of America (BA):

Bank of America BAC Strongest Stock in the Dow Jones

Again, the general trading thesis is “stocks that are strong tend to get stronger” over time.  This leads either to breakout or (preferably) pro-trend retracement style trading strategies.

Not all stocks can show leadership; some have to lag the index.

Current “Relative Strength Laggards” in the Dow include AT&T (T), Coca-Cola (KO), IBM (IBM), Caterpillar (CAT), and Chevron-Texaco (CVX).

Here’s a chart of the “worst” stock in the Dow in the last year (plus two months) – AT&T (T):

AT&T (T) Weakest Stock in the Dow Jones Industrial Average Relative Weakness

While the Dow Jones Index trades near all-time highs (and the S&P 500 currently trades at all-time highs above 1,875), we see AT&T (T) challenging fresh new 52-week price lows into the $32.00 per share area.

AT&T has been in a structural downtrend – except for a sharp rally in October 2013 – since the April 2013 peak.

Continue watching these names along with any rotation in the stock leadership landscape.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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