Tuesday, May 30, 2006


As I tell students and other advice-seekers, don't be premature in calling topping or bottoming formations. However, most indications are pointing to a H&S top IF we break the horizontal neckline and Volume confirms it at each stage.
Last week's mostly up market eased any signs of Fear or Hope ( I like Hope better than Greed): the VIX and put/call ratios backed off from positive; the McClellan Osc. actually went up through the zero line (Bullish) with th Sum. seeming to bottom out -ST- at minus 290. NYSE new hi's/lows were ugly for the week at 61:341, better than a 1:5 ratio. Also pointing upward are the extremely low Nova/Ursa fund numbers and the AAII inversion of Bears (45) over Bulls (33), althought he II (Investor's Intelligence) and Market Vane are at midrange normal.
On their way to Bullish are both the master index from Smith/Barney, called the Panic/Euphoria, as well as the Bullish per cent -now at a low 54, but not at a support level yet.
Today's (Monday) big selloff - 150 pts. - was on extremely light, post-holiday Volume, with the end of the month ahead, where funds, futures traders and other big money players square their accounts.

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

Subscribe in a reader


No comments:

Post a Comment