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Monday, February 26, 2007

MARCH - LION OR LAMB?:

Despite a slightly negative (so far) February, which is usually the 2nd worst month of the year, a feeling of toppiness still exists: thanks to Finance, Healthcare and Tech sectors, insider selling by key employees keeps rising, to over 1B shares vs. 17M, a ratio of 60:1.
Money Market Funds rose to a record $2.36T while margin debt surpassed the March 2000 high of $276B at a current $285B on the NYSE.
On CNBC, Ken Tower advises to watch Volume and Breadth (new highs) in the next rally after this current decline. The gov't is forecasting a possible Surplus by '08 (election time) due to the great prosperity from its tax cuts, so Income Taxes might give the market a boost this Spring.I
n spite of the week's decline (except for the Nasdaq at new recent highs), breadth got even stronger, with A/D and new highs/lows increasing; fund inflows increased, at least in the ETF zone.
Still at disturbingly toppy levels, however, are the Bullish per cent, at 79 the highest since Feb. '04, at a top that prevailed for a year; Market Vane pollees climbed to a high 73% Bulls, as did the AAII, at 54 to 22 ursine types.
Here are the weekly numbers:
Mktsentiment. 2/23/2007......5Yr.HI........ LOW

DJIA ………. 12647...........12767...........7286
Nasdaq………. 2515nrh............2515............1114
S&P500…….. 1451............1455............776
CBOE Equity put/call .68............87-5/04........46-1/03

VIX ………. 10.5.........44 9/02........10.0-11/06

ISEE-call/put ……. 101...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……-10...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 904...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..50...........62.9-12/04......35-6/06
Bear:………… 22.2 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….53.9/22.3....n/a n/a
MarketVane Bulls…. 73......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.4/29.7
Bullish%- ………79...............88 -2/04...... 46-8/04

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, February 20, 2007

LET'S ALL GET HIGH:

Last week saw new highs, at least recent ones, in the DJIA, TRAN and UTILS, and the SPX, Russell 2000 and Nasdaq. This despite a 9-year low in housing starts (1/3 the job growth since 2000), and January starts down 40% from '06. Ben B. says several reports say there is a "tidal wave of defaults and foreclosures ahead", with over 1M in '06. Meanwhile Mike Santoli reports the weakest buying of Treasuries by foreigners since '02, although China now owns over $1T.
One of the chief demand sources of U.S.stocks, Japan carry-trade, may also slow if Japan starts raising rates.
Still, a scarcity of stocks due to M&A, Private Equity takeovers, ETFs and hedgefund overfishing, plus the ever-present liquidity from Asian and mid-East wealth, seem to bolster the market out of any correction. It's like coming to an intersection and both the green and red light are on.
Sentiment is nearing the yellow light, however, with extremes in new highs, advance/ declines, and the Bullish per cent at toppy levels. The ISEE call/put was over 150 -near the 200 bearish point, although the CBOE is at a recent high of 64 indicating hedging; the VIX is at a recent complacent low of 10, and the McClellan Summation topped 900.
After more than a year's absence of retail buying in Mutual Funds (U.S.) they have started tiptoeing in this year. Finally, I saw Insider Selling by key officers climb to 50:1, or 21M Buyers vs. 1.1B Sellers last week.
Here are the numbers:

Mktsentiment. 2/16/2007......5Yr.HI........ LOW

DJIA ………. 12767nh...........12767...........7286
Nasdaq………. 2496............2502............1114
S&P500…….. 1455............1455............776
CBOE Equity put/call .64............87-5/04........46-1/03

VIX ………. 10.0.........44 9/02........10.0-11/06

ISEE-call/put ……. 156...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……8...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 900...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..51.1...........62.9-12/04......35-6/06
Bear:………… 21.1 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….47.6/31.1.....n/a n/a
MarketVane Bulls…. 71......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.3/29.4
Bullish%- ………78...............88 -2/04...... 46-8/04

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, February 12, 2007

CycleAnalysis

Not exactly Sentiment, but I noticed in the IBD chart page that there seems to be a rhythmic 17 or 18-day cycle (connecting the cycle lows) going back to at least June. After the low there is a jump up into a new rally, so if this one isn't dead yet, it may reoccur later this week or next.
Despite last week's ugly ending, not much has changed in the Indicators. Exceptions were:
NY new highs - 822 to 31, pretty strong for an old market.
Int.term toppy highs in the McClellan Summation, Bullish per cent and Market Vane (72).
Bullish signs were the Public stepping up versus Specialist shorts, and the ETF inflows roared back in. Here are the numbers:

Mktsentiment. 2/9/2007......5Yr.HI........ LOW

DJIA ………. 12580...........12653...........7286
Nasdaq………. 2459............2502............1114
S&P500…….. 1438............1430............776

CBOE Equity put/call .61............87-5/04........46-1/03

VIX ………. 11.1.........44 9/02........10.0-11/06

ISEE-call/put ……. n/a...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……-7...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 888...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..52.2...........62.9-12/04......35-6/06
Bear:………… 22.2 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….46.2/30.....n/a n/a
MarketVane Bulls…. 72......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.2/38.7
Bullish%- ………78...............88 -2/04...... 46-8/04

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, February 5, 2007

PARALLEL UNIVERSE:

Paradoxes abound - the world seems awash with liquidity, yet Barrons reports Money Market Cash and Funds' portfolio Cash is at least at 1 year lows; we have a negative 1% Savings rate (worst since the Depression), yet people still have money. Stocks are only at 10% of Household assets, versus 23% in '00.
Complacency increases with a lowering of Public/NYSE Specialist shorting, increasing AAII Bulls, the UBS Investor confidence rising over 100, and the VIX right at 10.
Please see below:

Mktsentiment. 2/2/2007......5Yr.HI........ LOW

DJIA ………. 12653nh...........12653...........7286
Nasdaq………. 2475............2502............1114
S&P500…….. 1448............1430............776
CBOE Equity put/call .62............87-5/04........46-1/03

VIX ………. 10.1.........44 9/02........10.0-11/06

ISEE-call/put ……. 97...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……39...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 789...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..53.3...........62.9-12/04......35-6/06
Bear:………… 21.1 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….46.3/30.5.....n/a n/a
MarketVane Bulls…. 70......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.2/38.7
Bullish%- ………76...............88 -2/04...... 46-8/04

*Insider corporate sellers 39:1, up from 20:1 in Nov.
**UBS Confidence and Consumer Confidence Surveys at 5 year highs-103
***Schwab Daily Average Trades at 250k, same area as in 2000 (2002 was 140K).

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


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