Tuesday, August 17, 2004


For months now a unanimity of Talking Heads and Media Gurus have been touting favorite Industry Groups for this year as (GOLD) Energy, which might have just put in a double top, (SILVER) Healthcare, which has follwed the markets down, and (BRONZE) Cyclical stocks, which the revised XLY Spider exhibits heading for new lows. This action lends proof to the Contrarian theory, and Oil just might be following the runners-up into the dumpster after a double-tops in the OIH and XLE.
Exceptional Sentiment Indicators that are Bullish now are the CBOE put/call ratio at a high 83 (per Barron's), and the AAII Survey with still more Bears (40) than Bulls (38.8). At a '04 low is the Rydex Nova/Ursa ratio of .16 (Bullish) which has worked perfectly for high and low turning points. Also Bullish is the Public/NYSE Specialist ratio near a 5-yr. high of 2.46 as well as the multi-year high DJIA Dividend Yield of 3.3%, a great reason for buying, especially with the new tax advantage.

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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