Mistakes will happen. Look at the GDP predictions by the best and brightest Economisseds for the past several quarters; look at Barron's stock pickers, underperforming static INDICES! And according to Prof. Tetlock of UC Beserkely, out of 27,450 future predictions barely 50% were correct, with the most egregiously wrong being the most esteemed, such as Paul Ehrlich and Paul Krugman. Stuff happens.
Looking at a yearly chart, the previous times the VIX has spiked, as it did last week, a huge rally ensued. The A/D (advance/declines on the NYSE) were 1:10, which should be a selling climax. Ergo, the McClellan Oscillator sank to a minus 84, with -50 being my buy signal.Since I started keeping track of the COT, the commitment of large (smart money) traders went positive for the first time, barely. Small traders are still looking through rose-colored glasses.
Finally, money market Outflows were huge, as were equity fund flows yet again - ETF capital remains unchanged, although margin interest has lessened for the second month.
Here are the correct numbers:
| MktSentiment | Last Week | Prev. Week | 5 Yr HI | 5 Yr LOW |
| DJIA: | 12143 | 12681 | 14093 | 6626 |
| Nasdaq: | 2756 | 2858 | 2861 | 1114 |
| S&P 500: | 1292 | 1345 | 1561 | 683 |
| CBOE Eq. put/call: | 67 | 60 | 96-10/08 | 46-1/03 |
| VIX: | 25.3 | 17.5 | 90 | 8.8 |
| McClellan Osc: | (84) | 13 | 108 | (123) |
| McClellan Sum: | 165 | 460 | 1568 | (1514) |
| Newsletter Surveys | ||||
InvestorsIntel.Bull:
| 49.5 | 46.2 | 63 | 22.21 |
InvestorsIntel.Bear:
| 21.5 | 21.5 | 54.4 | 16 |
AAII Bull:
| 37.8 | 39.9 | n/a | n/a |
AAII Bear:
| 31.4 | 30.6 | n/a | n/a |
| US Equity-1 week lag | n/a | (6.5B) | ||
| Money Market Flows | (37.5B) | (24.7B) | ||
| Baltic Dry Index: | 1278 | 1325 | 11700 | 663 |
Bullish %:
| 59 | 70 | 89 | 2 |
| Insider Corporate Sellers: | 37:1 | 63:1 | 235:1 | 2.4:1 |
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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