Monday, February 22, 2016


More and more credible (IMO) market analysts are calling for up to 50% Bear market ahead. From Barron's last week - John Hussman, and John Mauldin's goto - GaveKal. Just like gloomanddoomer James Davidson, They cite the CAPE ratio from R. Shiller on 10-year EPS overvaluation and Global Debt. Also an extended Market Capitalization to GDP ratio. It would be wise to heed this eventuality - my choice to hedge is TVIX and DXD inverse ETFs.

A Recession, however, seems to be off the table for now - they are usually preceded by an uptick in both Oil and Unemployment (not on the radar so far). Most seem to occur on 0 years of the Decennial cycle.

In a shortened week the sharp rise came early - enough for the two newsletter surveys to see - although they still both remain Bearish; the put/call ratio is high, as is the McClellan Oscillator (51), as we see the market take off today. Money flows see $$ going into MMFs and global Gold ETFs.

Here are the numbers:

Date> 2016 2/19/2016 2/12/2016
Indices: DJIA  16391 15973
  NAZ  4504 4337
SPX  1917 1864
WklyVolume (Bshs). naz/ny…. 8.2/4.7* 12.3/6.1
Specul.Ratio hi=bullish 1.74 2.01
Sentiment: put/call-CBOE  78 83
VIX>50-alltmlow=8.8 20.5 25.4
Advance/Dec-NYSE.. 2683/516 728/2476
Weekly Net: 2167 -1748
     Cumulative: 157510 155343
Weekly  NYSE hi/low… 76/116 144/978
New Hi's/Low's Nasdaq h/l 48/178 31/920
McClellan  Oscillator 51 -4
McClellanSum .+750/-1000 -467 -668
Newsletter Inv.Intel -Bull 26.5 24.7
Surveys-Tues Bear:-5yrs 39.8 39.2
Wed. AAII  -Bull  27.4 19.2
Bear  37.8 48.7
US$-WSJ 96.6 96
3-box rev Bullish%-  47 30
US equity -ICI Fund Flows WeekLate (3.6B)
MMF flows Change in $B 7.5B 3.2B
MargDebt- top (300M) monthly  461B
2-yr Tsy Yield: Inflation 0.75% 0.71%
TIP (ETF) Inflation 111.3 111.6

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