Tuesday, May 13, 2008

"STABLE" ECONOMY:

When George Bush says we have a stable economy he must mean it belongs in the barn. Last week the market seemed more correlated (inversely) to record oil prices than fundamentals, yet most of the indicators went on vacation with me. The put/call ratio, VIX, market letters, even the short interest, stayed the same.
Mutual funds outflows of $6M along with ETF inflows of the same amount was a wash - yet moneymarket outflows were a record $78B. And IBD's short interest ratio hit another record of 13.0.
Here are the numbers:

MktSentiment. 5/9/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12745………..13058………..14093............7286
Nasdaq………. 2445…………..2477…………2810.............1114
S&P500…….. 1388………….1413…………1561………..776
CBOE Eq. put/call …64…………….66……………..92-1/08…..........46-1/03

VIX ………. 19.4………….18.2…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 28……………30…………..76(bullish)….28(bearish)
McClellan Osc………22…………..37……………91-5/04 br......(-81)-5/04bu
McClelSum………304…………….209…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…44.4………….40.9……….…12/04br......35-6/06bu
Bear:………… 32.3…………31.8………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……52.8/24.7…….53.3/26.3……..n/a n/a
MarketVane Bulls…55……………52…………. 74br..............24bu
IBD: Short Interest- 13nh……….12.58nh…………13.0………. 4.0
Public/NYSE Spec.-…12.1……….12.1……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………36/45…….38/28
Bullish%- …………56……….54……….…88 -2/04br.....19bu
*Insider corporate sellers.20:1…..25:1………..97…………..5
Sectors: Most Buyers: Finance, Technology
Most Sellers: Technology

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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