Monday, September 2, 2013


Labor Day usually marks the end of the summer doldrums, with the usual suspects of fiscal year end, Congress reconvening, etc., and with added Volatility anticipated from debt ceiling, Syria, on top of a tired stock market cyclical Bull now into its 5th year, September may again become the year's worst - contrary to T.S. Elliot.

 The S&P 500 and the Nasdaq (when it's open) have been in a Yin/Yang struggle, first monthly, more recently weekly ups and downs. After last week's turmoil the VIX closed at a recent high of 17; and the McClellan Oscillator in the minus zone. My latest Indicator- McMillan's CBOE equity put/call ratio- is on a SELL mode. Margin debt is near an all-time high - $382B, but Insiders have slowed down on Selling, as have the Large COT traders in the SPX. Also on the COT (Commitment of Traders), Gold commercials have increased their shorts, coming off an 11-year low. The Inflation harbinger - the 2-year TSY- equalled its recent high yield of .40%!!

What is strange is ETFs have seen INFLOWS in stocks, Int'l AND Bonds month over month. Here are the numbers for last week:

8/30/2013 8/23/2013
Indices: DJIA  14810 15010
  NAZ  3589 3657

SPX  1632 1663
WklyVolume (Bshs).

NASD/NYSE   7.0/3.1 6.5/.3.1
Specul.Ratio hi=bullish 2.26 2.10

Sentiment: put/call-CBOE  62 59
VIX>50-alltmlow=8.8 17.0 14.0
Advance/Dec-NYSE.. 822/2368 1922/1272
Weekly Net:
-1546 650
     Cumulative: 148403 149949
Weekly  NYSE hi/low 133/176 122/647
New Hi's/Low's Nasdaq h/l 197/75 208/98
McClellan  Oscillator -23 -3
McClellanSum .+750/-1000 -325 -219
Newsletter Inv.Intel -Bull:tues 38.1 43.3
Surveys Bear:-5yrs 23.8 21.6

AAII  -Bull :wed. 33.5 29

Bear  30.7 42.9
COT:SPX w/w large/small (net)k 4/-12 7/-1
COT:gold  comm.hedg long-short.000 -88 -68
CEOinsider selling 19:1 17:1
3-box rev Bullish%-  76 79
US equity -ICI Fund Flows 1weeklag (.4B)
MMF flows Change in $B 6.5B 15.4B
MargDebt- top (300M) monthly  382B JULY
ETF:Eqty/ Int'l/Bond 925/335/250 JULY
(Monthly  B$$ .)

2-yr Tsy Yield: Inflation 0.40% 0.38%

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: 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 Zero (IN)Tolerance

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