Monday, August 15, 2011


Don't call Congress back! Technical studies show the markets do much better when Congress is out of session (of course, this is mostly due to Holidays). MIT studies also show that not only do persons with positive attitudes lead happier and healthier lives, but are better at investing - with sharper intuition. And Felix Salmon of Reuters notes that longer term investors should welcome corrections such as these - for dollar cost averaging and mutual fund reinvesting, the lower the better. Also, bubbles such as tech stocks, Real Estate, Gold (?) usually end up badly without a respite. BTW - the CME is raising margin requirements on Gold, just as they did with silver.
Sentiment conditions still remain oversold and indicating  a strong rally: the NASD to NYSE Volume is near record lows; NYSE new highs were an incredible 20 to 1510 new lows for the week; the McClellan Summation is now negative 621.
Legal insider selling is way low at 4:1, after weeks in the 50's and 60's to 1 buyers. Money market flows did a huge flip flop the past two weeks: 66B out, then 53B back in last week (but not into stock funds). Finally, the Bullish % is at a lowly 23% of stocks on buy signals.
Here are the weekly numbers:

MktSentiment Last WeekPrev. Week 5 Yr HI 5 Yr LOW
S&P 500:117811991561683
CBOE Eq. put/call: 858596-10/0846-1/03
McClellan Osc:(8)(111)108(123)
McClellan Sum:(621)(275)1568(1514)
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AAII Bull:
AAII Bear:
US Equity-1 week lagn/a(10.4B)
Money Market Flows52.8B(65.8B)

Baltic Dry Index:1287126811700663
Bullish %:
Insider Corporate Sellers:4:114:1235:12.4:1

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