MMM Strength as a Proxy for the DOW

By | September 29, 2015

We noted a divergence between the 3M Company (MMM) and the Dow Jones Industrial Average in June and the bearish scenario has played out. Today, however, 3M shares are up over 2.5% and a look at the weekly chart shows how they are trying to hold just above the October 2014 lows. If they could stabilize at this level it would be a good sign for the broader market because of the historic correlation between the stock and the index. The money flow index at the bottom of the chart is a volume-weighted measure of money flow, and it is in extremely oversold condition, which suggests that the 3M sellers may be exhausted.

99928.MMMchart

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