Monday, June 27, 2016

UK - The "UNTIED" KINGDOM

If you Brexit, you Own it!! And their currency got "Pound'ed" - The S F Comical likened it to Texas leaving the U.S. (Texit?). Standard and Poor's just downgraded Britain's economy from AAA to AA today - I  guess they have to go to those damn meetings again!

 Despite the whirlwind finish to  last week,  overall, it wasn't that exceptional for Sentiment. Of course the VIX (Volatility Index) jumped up 1/3, to 26, week over week. Volume was strong as well, as were Bonds and Gold, in a flight to safety. AAII Bears were still strong, a bullish sign (FOR the market).

Here are the numbers:

SPX  2037 2071
WklyVolume (Bshs). naz/ny…. 10.6/6.0 9.9/5.7
Specul.Ratio hi=bullish 1.77 1.74
Sentiment: put/call-CBOE  74 72
VIX>50-alltmlow=8.8 25.8 19.4
DeltaMSI-50% MAC crossover 62% 67%
Advance/Dec-NYSE.. 1243/1916 1164/1990
Weekly Net: -673 -826
     Cumulative: 166814 167487
Weekly  NYSE hi/low… 391/73 270/83
New Hi's/Low's Nasdaq h/l 167/194 145/182
McClellan  Oscillator -21 -28
McClellanSum .+750/-1000 772 783
Newsletter Inv.Intel -Bull 47.5 45.9
Surveys-Tues Bear:-5yrs 23.2 23.5
Wed. AAII  -Bull  22 25.4
Bear  35.2 37.5
US$-WSJ 95.5 94.1
3-box rev Bullish%-  60 67
US equity -ICI Fund Flows WeekLate  (.1B)
MMF flows Change in $B (3.6B) (18.6B)
MargDebt- top (300M) monthly 
10-yr Tsy yield hi= stock buying 1.56% 1.61%
2-yr Tsy Yield: Inflation 0.63% 0.70%
TIP (ETF) Inflation 115.8 115.4


With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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Monday, June 20, 2016

BREXIT OR BREMAIN?

According to the Wisdom of Crowds, the U K should exit the EU on Thursday (our Wednesday night 11 to 1?); but the seeming reversal due to the assassination , and the fact that polls got it wrong in Scotland and Canada prior times, the Brits could Bremain, probably lifting both the European and U S markets with relief. Also, fund managers' cash is at a  high level, usually Bullish as well.

My new Indicator, the Delta MSI (stocks on Buy signals from moving average crosses) is echoing the old one of Bullish % - stocks on BUY signals. After an ugly two weeks in the markets, today's rally is no surprise. MMF flows were out of Money Markets bigtime, and the AAII Bears jumped 10 points - see below:

Date>   6/17/2016 6/10/2016
Indices: DJIA  17675 17865
  NAZ  4800 4894
SPX  2071 2096
WklyVolume (Bshs). naz/ny…. 9.9/5.7 8.5/4.3
Specul.Ratio hi=bullish 1.74 1.98
Sentiment: put/call-CBOE  72 67
VIX>50-alltmlow=8.8 19.4 17
DeltaMSI-50% MAC crossover 67% 74%
Advance/Dec-NYSE.. 1164/1990 1576/1589
Weekly Net: -826 -13
     Cumulative: 167487 168313
Weekly  NYSE hi/low… 270/83 513/37
New Hi's/Low's Nasdaq h/l 145/182 255/108
McClellan  Oscillator -28 -13
McClellanSum .+750/-1000 783 990
Newsletter Inv.Intel -Bull 45.9 47.3
Surveys-Tues Bear:-5yrs 23.5 23.8
Wed. AAII  -Bull  25.4 27.8
Bear  37.5 27.8
US$-WSJ 94.1 94.7
3-box rev Bullish%-  67 72
US equity -ICI Fund Flows WeekLate (1.0B)
MMF flows Change in $B (18.6B) (5.7B)
MargDebt- top (300M) monthly 
10-yr Tsy yield hi= stock buying 1.61% 1.64%
2-yr Tsy Yield: Inflation 0.70% 0.73%
TIP (ETF) Inflation 115.4 115.8


With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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Monday, June 13, 2016

Internet of Things

It has been my contention that at some point the exploding Internet inventions, as well as the San Francisco population will end in a Future Shock spiral (at least a course correction). Either a major earthquake in S.F., or, as Barron's points out this week, technology is getting so complex that many cannot understand or apply the myriad startups - especially when the top FANG companies are so competitive with their proprietary findings as to not become universal.

Another danger, of course, is the global NIRP which is affecting the U.S. interest rates, as foreigners buy record amounts of Treasuries - how will pensions, Social Security retirement accounts meet their 7.5% necessary profit performance in a negative world, mandating at least some Treasuries in their investment portfolios? But the stock market rolls on!!!

A Barron's editorial finds that over the past 50 years, the stock market in 20-year slices, has always gained 8 to 12%. And Tom Bowley of Stockcharts.com relates that stocks bought between the 27th of the month and the 6th of the next shows 100% of the gains!! BTW , those of us GGU alums will recognize Gatis Roze as a regular contributor...

Despite recent weakness, most Sentiment Indicators, just like the indices, are near recent Bullish levels - NYSE H/Los were 513 to 37.

Here are the numbers:
Date>   6/10/2016 6/3/2016
Indices: DJIA  17865 17807
  NAZ  4894 4942
SPX  2096 2099
WklyVolume (Bshs). naz/ny…. 8.5/4.3 7.3/4.3*
Specul.Ratio hi=bullish 1.98 1.7
Sentiment: put/call-CBOE  67 60
VIX>50-alltmlow=8.8 17 13.5
DeltaMSI-50% MAC crossover 74% 70%
Advance/Dec-NYSE.. 1576/1589 2167/1011
Weekly Net: -13 1156
     Cumulative: 168313 168326
Weekly  NYSE hi/low… 513/37 368/27
New Hi's/Low's Nasdaq h/l 255/108 202/79
McClellan  Oscillator -13 30
McClellanSum .+750/-1000 990 843
Newsletter Inv.Intel -Bull 47.3 45.4
Surveys-Tues Bear:-5yrs 23.8 23.7
Wed. AAII  -Bull  27.8 30.2
Bear  27.8 29.1
US$-WSJ 94.7 94
3-box rev Bullish%-  72 71
US equity -ICI Fund Flows WeekLate (.8B)
MMF flows Change in $B (5.7B) 0
MargDebt- top (300M) monthly  456B
10-yr Tsy yield hi= stock buying 1.64% 1.70%
2-yr Tsy Yield: Inflation 0.73% 0.78%
TIP (ETF) Inflation 115.8 115.1


With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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Tuesday, June 7, 2016

SWEET BREADTH

One of the lesser known Sentiment Indicators is the Speculation of Nasdaq stocks to NYSE, which is near its long term low this week; also low is the CBOE put/call ratio and VIX. Buyers versus Sellers got stronger, as we approach the old highs again, with the Fed putting off rates, the Brexit and Election upcoming:
Advances over Declines rose, as did New Highs over Lows (368 to 27) -  my cumulative A/D this week is EXACTLY at the all-time high of 168,326!! The McClellan Summation is moving to 1,0000 again. Here are the numbers:

Date>   6/3/2016 5/27/2016
Indices: DJIA  17807 17873
  NAZ  4942 4933
SPX  2099 2099
WklyVolume (Bshs). naz/ny…. 7.3/4.3* 8.6/4.2
Specul.Ratio hi=bullish 1.7 2.05
Sentiment: put/call-CBOE  60 59
VIX>50-alltmlow=8.8 13.5 13.1
DeltaMSI-50% MAC crossover 70% 64%
Advance/Dec-NYSE.. 2167/1011 2482/695
Weekly Net: 1156 1787
     Cumulative: 168326 167170
Weekly  NYSE hi/low… 368/27 241/50
New Hi's/Low's Nasdaq h/l 202/79 190/106
McClellan  Oscillator 30 21
McClellanSum .+750/-1000 843 731
Newsletter Inv.Intel -Bull 45.4 35.4
Surveys-Tues Bear:-5yrs 23.7 24
Wed. AAII  -Bull  30.2 17.8
Bear  29.1 29.4
US$-WSJ 94 95.7
3-box rev Bullish%-  71 69
US equity -ICI Fund Flows WeekLate (,9B)
MMF flows Change in $B 0 14.2B
MargDebt- top (300M) monthly  456B March
10-yr Tsy yield hi= stock buying 1.70% 1.85%
2-yr Tsy Yield: Inflation 0.78% 0.92%
TIP (ETF) Inflation 115.1 114.3


With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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Monday, May 30, 2016

TAKE A HIKE

The prominent story these days in the media, other than the Hilary/Trump saga, is whether the Fed will again raise rates soon - June or July. Normally rate hikes are beneficial for stocks, providing the economy is strong - which it is NOT these days. In fact, per Barron's, rate hikes with low GDP during the years 1976, 1986, and Dec. 2015 led to double-digit declines (1983 did not). There is also the Brexit vote on the 23rd to consider. As for S&P earnings, it is rare that they decline, year over year, as they did in 2015, and even moreso 2 years in a row, which appears likely.

In another small sampling, whenever the Yield Curve flattens, i.e., the 2-year Treas yield is equal to the 10-year (due to rate hikes), we have Recessions and Bear markets, going back to 1980 (1991, 2001, and 2008). But nice rallies can precede these.

So marks the Sentiment Indicators these days. The AAII Bull/Bear survey hit a recent low (2005) of Bulls - see below-, with a decade high of Neutrals (2003) - Bullish FOR the markets. Last week saw strong Breadth, if not Volume, with the Holiday this week. $$ are still going into MMFs and out of Equity MUFs, and IPOs are slowing recent months.
Here are the numbers:
Date>   5/27/2016 5/20/2016
Indices: DJIA  17873 17500
  NAZ  4933 4769
SPX  2099 2052
WklyVolume (Bshs). naz/ny…. 8.6/4.2 9.3/4.6
Specul.Ratio hi=bullish 2.05 2.02
Sentiment: put/call-CBOE  59 75
VIX>50-alltmlow=8.8 13.1 15.2
DeltaMSI-50% MAC crossover 64% 63%
Advance/Dec-NYSE.. 2482/695 1515/1653
Weekly Net: 1787 -138
     Cumulative: 167170 165383
Weekly  NYSE hi/low… 241/50 277/76
New Hi's/Low's Nasdaq h/l 190/106 115/212
McClellan  Oscillator 21 -31
McClellanSum .+750/-1000 731 723
Newsletter Inv.Intel -Bull 35.4 40.2
Surveys-Tues Bear:-5yrs 24 21.7
Wed. AAII  -Bull  17.8 19.3
Bear  29.4 34.1
US$-WSJ 95.7 95.3
3-box rev Bullish%-  69 67
US equity -ICI Fund Flows WeekLate (2.7B)
MMF flows Change in $B 14.2B 4.3B
MargDebt- top (300M) monthly  March 446B
10-yr Tsy yield hi= stock buying 1.85% 1.84%
2-yr Tsy Yield: Inflation 0.92% 0.88%
TIP (ETF) Inflation 114.3 114.1


With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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Monday, May 23, 2016

FED UP

For weeks now the  only topics in the media - print, online, and video - have been Politics and Viagra commercials (Elections and Erections). Finally they have shifted to what the Fed is going to do about interest rates come June, including interviews with the neighborhood gardener and other experts.
Funnily enough, according to technical analysis studies, markets actually like the first couple of rate hikes, before hitting its average, then pendulum-swinging too far. That is, if the economy warrants it - as it did NOT in December, when January made them pay.

I'm not much of a bond guy - especially now with Zero rates - but a very insightful column by Ben Levisohn in Barron's Streetwise piece, talks of the January Crashette with conditions similar now if a June hike is imminent (odds are increasing). Ben posits that when the 10-year Treas yield rises (bond prices fall) it is good for the stock market, so I'll be adding the 10-year to my 2-year Inflation indicator, which is registering nothing these days. Another bond column signals that if the 10-year minus the 2-year yield gets down to zero (flat) it almost always signals a Recession and/or Bear market.
Unfortunately, my switch to the UVXY hedge is not working out as planned, although better than the TVIX hedge, since I am milking a huge covered call premium on it. It has de-correlated from the VIX, due to Beta-slippage and futures rollovers. Still, a crash before Sept. would be profitable. After all, Put options have more decay as hedges.
Most Sentiment Indicators are benign, with breadth and A/D in stocks weakening. Here are the numbers:

Date>   5/20/2016 5/13/2016
Indices: DJIA  17500 17535
  NAZ  4769 4717
SPX  2052 2046
WklyVolume (Bshs). naz/ny…. 9.3/4.6 8.8/4.6
Specul.Ratio hi=bullish 2.02 1.91
Sentiment: put/call-CBOE  75 84
VIX>50-alltmlow=8.8 15.2 15
DeltaMSI-50% MAC crossover 63% 70%
Advance/Dec-NYSE.. 1515/1653 1361/1793
Weekly Net: -138 -432
     Cumulative: 165383 165521
Weekly  NYSE hi/low… 277/76 445/80
New Hi's/Low's Nasdaq h/l 115/212 137/201
McClellan  Oscillator -31 -46
McClellanSum .+750/-1000 723 922.0
Newsletter Inv.Intel -Bull 40.2 39.2
Surveys-Tues Bear:-5yrs 21.7 21.6
Wed. AAII  -Bull  19.3 20.4
Bear  34.1 31.3
US$-WSJ 95.3 94.6
3-box rev Bullish%-  67 70
US equity -ICI Fund Flows WeekLate (7.4B)
MMF flows Change in $B 4.3B 5.7B
MargDebt- top (300M) monthly  MARCH
10-yr Tsy yield hi= stock buying 1.84%
2-yr Tsy Yield: Inflation 0.88% 0.75%
TIP (ETF) Inflation 114.1 115.2




With record numbers of dollars coming out of Money Market Funds, mostly into the crowded trade of short term bonds, anyone who has a minimal knowledge of covered call options and/or an interest in hedging stock market exposure might want to check out: brentleonard.com for an alternative strategy that is low-risk as well as highly rewarding. For those of you wanting more details and actual trading results, a new book is available for $14.95 at Amazon.com: Zero (IN)Tolerance


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