Monday, September 7, 2015


Because the market cannot go down!!
According to what I read from my favorite research sources - Bespoke, Sam Stovall of S&P IQ, Dave Rosenberg - we are not through with the market correction - the first one in 4 years. Historically, it could last @ 3 more weeks, or through September, based on studies of corrections back to 1926.
The good news is that when Sept.1 was down more than 1%, the remaining drop was @2% - when August was also down (as it was this year), it is more like a 4% drop. Worst case is just below 15,000  on the DJIA 30, or 20% from its highs.
Two things are troubling - market Breadth - advancing and declining stocks, new highs, etc. crashed down recently to the 5th Standard Deviation (around 98%) for the first time since I was two years old!!
Also, per 60 Minutes report Int'l hacking is getting extreme, to where we could expect a shutdown of the Utility and/or Financial grids from foreign hackers.

Last week's New Highs over Lows was almost 10 to 1, actually an improvement from the previous week of only 18 versus 1456! MMF flows (money markets) reversed to withdrawals from increases; stock mutual funds are still experiencing withdrawals as well.

S&P futures Large traders (smart money (??) was plus 10k, while small traders were shorting 75k, a huge number. Also dramatic, for what it is worth, is CEO Insider Selling of their corporate stock - 3 to 1 over buyers; usually it is in the 30-40:1 range - it was 180:1 sellers in July!

For the numbers go to

Here are the numbers:

Date> 9/4/2015 8/28/2015
Indices: DJIA  16102 16643
  NAZ  4683 4828
SPX  1921 1988
WklyVolume (Bshs). naz/ny…. 9.3/5.1 12.9/6.5
Specul.Ratio hi=bullish 1.82 1.98
Sentiment: put/call-CBOE  73 78
VIX>50-alltmlow=8.8 27.8 26.1
Advance/Dec-NYSE.. 857/2373 1584/1678
Weekly Net: -1516 -94
     Cumulative: 158685 160201
Weekly  NYSE hi/low… 25/227 18/1456
New Hi's/Low's Nasdaq h/l 54/164 57/903
McClellan  Oscillator 0 21
McClellanSum .+750/-1000 -583 -612
Newsletter Inv.Intel -Bull 27.8 31.6
Surveys-Tues Bear:-5yrs 26.8 22.5
Wed. AAII  -Bull  32.4 32.5
Bear  31.7 38.3
COT:SPX w/w large/small (net)k 10k/(75k) 10k/(56k)
COT:gold  comm.hedg long-short.000 (69k) (62k)
COT:OIL comm.hedg long-short. (219k) 215
US$-WSJ 89.0 88.5
CEOinsider selling        .9:1 .3:1
off.&bd b/s.vs. 10% holder b/s discont.
3-box rev Bullish%-  38 31
US equity -ICI Fund Flows weekDelay (9.8B)
MMF flows Change in $B (16.1B) 9.0B
MargDebt- top (300M) monthly  487B JULY
ETF:mthlyEqty/ Int'l/Bond-$B 1275/509/321 JULY
2-yr Tsy Yield: Inflation 0.71% 0.72%
TIP (ETF) Inflation 110.9 111.7

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