Monday, March 23, 2015


Any one who has traded options as well as entered March Madness Basketball pools knows the similarity of emotions with both: Hope and confidence at the start; day by day the hope turns to fear and disappointment; finally both end in loss, as expiry and the Finals occur. At least they both get your attention for awhile!The remedy for options is to SELL them, not BUY them; there is none for Basketball.

Being a "technical analyst" usually means being a Contrarian! This means going against the crowd. Last week was all about Chairwoman Yellen being "Patient" - I do not know if she meant wait awhile or visit the Doctor!

In Barron's this past week Scott Minerd writes the minority opinion (also mine) that interest rate hikes are actually GOOD for stocks, rising 6 months before as well as after the event.

Last week's Sentiment Indicators had these Contrarian gifts: The AAII (Individual Investor) Bears rose nearly 25% week over week; Insider Selling of CEOs has dropped recently (smart money); the Commitment of (futures) Traders also showed a big rise in S&P buying by large traders, with small traders  increased selling (see table below).

Most important was the backing off of smart selling by Gold Traders - finally- and the technical rise in gold recently (hoping it continues, as the $$ starts to weaken a bit after risin 25% the past year)

Here are the numbers:

Date> 3/20/2015 3/13/2015
Indices: DJIA  18127 17749
  NAZ  5026 4871
SPX  2108 2053
WklyVolume (Bshs). naz/ny…. 9.7/5.3 9.0/3.9
Specul.Ratio hi=bullish 1.83 2.33
Sentiment: put/call-CBOE  48 69
VIX>50-alltmlow=8.8 13 16.0
Advance/Dec-NYSE.. 2515/745 1411/1834
Weekly Net: 1770 -423
     Cumulative: 166509 164739
Weekly  NYSE hi/low… 422/172 180/222
New Hi's/Low's Nasdaq h/l 395/168 236/166
McClellan  Oscillator 22 -38
McClellanSum .+750/-1000 369 382
Newsletter Inv.Intel -Bull:tues 52 53.6
Surveys Bear:-5yrs 14.3 14.1
AAII  -Bull :wed. 27.2 31.6
Bear  31.5 25.4
COT:SPX w/w large/small (net)k 11k/(56k) 1k/(42k)
COT:gold  comm.hedg long-short.000 (57k) (89k)
CEOinsider selling 24:01:00 .20:1
off.&bd b/s.vs. 10% holder b/s .160:30 .160:45
3-box rev Bullish%-  72 71
US equity -ICI Fund Flows WeekDelay .3B
MMF flows Change in $B (19B) 18.2B
MargDebt- top (300M) monthly  Jan: 445B
ETF:mthlyEqty/ Int'l/Bond-$B Jan: 1219/424/308
2-yr Tsy Yield: Inflation 0.59% 0.66%
TIP (ETF) Inflation 113.76 111.51

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

Subscribe in a reader


No comments:

Post a Comment