LET'S ALL GET HIGH:

Last week saw new highs, at least recent ones, in the DJIA, TRAN and UTILS, and the SPX, Russell 2000 and Nasdaq. This despite a 9-year low in housing starts (1/3 the job growth since 2000), and January starts down 40% from '06. Ben B. says several reports say there is a "tidal wave of defaults and foreclosures ahead", with over 1M in '06. Meanwhile Mike Santoli reports the weakest buying of Treasuries by foreigners since '02, although China now owns over $1T.
One of the chief demand sources of U.S.stocks, Japan carry-trade, may also slow if Japan starts raising rates.
Still, a scarcity of stocks due to M&A, Private Equity takeovers, ETFs and hedgefund overfishing, plus the ever-present liquidity from Asian and mid-East wealth, seem to bolster the market out of any correction. It's like coming to an intersection and both the green and red light are on.
Sentiment is nearing the yellow light, however, with extremes in new highs, advance/ declines, and the Bullish per cent at toppy levels. The ISEE call/put was over 150 -near the 200 bearish point, although the CBOE is at a recent high of 64 indicating hedging; the VIX is at a recent complacent low of 10, and the McClellan Summation topped 900.
After more than a year's absence of retail buying in Mutual Funds (U.S.) they have started tiptoeing in this year. Finally, I saw Insider Selling by key officers climb to 50:1, or 21M Buyers vs. 1.1B Sellers last week.
Here are the numbers:

Mktsentiment. 2/16/2007......5Yr.HI........ LOW

DJIA ………. 12767nh...........12767...........7286
Nasdaq………. 2496............2502............1114
S&P500…….. 1455............1455............776
CBOE Equity put/call .64............87-5/04........46-1/03

VIX ………. 10.0.........44 9/02........10.0-11/06

ISEE-call/put ……. 156...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……8...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 900...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..51.1...........62.9-12/04......35-6/06
Bear:………… 21.1 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….47.6/31.1.....n/a n/a
MarketVane Bulls…. 71......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.3/29.4
Bullish%- ………78...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

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LET'S ALL GET HIGH:

CycleAnalysis

Not exactly Sentiment, but I noticed in the IBD chart page that there seems to be a rhythmic 17 or 18-day cycle (connecting the cycle lows) going back to at least June. After the low there is a jump up into a new rally, so if this one isn't dead yet, it may reoccur later this week or next.
Despite last week's ugly ending, not much has changed in the Indicators. Exceptions were:
NY new highs - 822 to 31, pretty strong for an old market.
Int.term toppy highs in the McClellan Summation, Bullish per cent and Market Vane (72).
Bullish signs were the Public stepping up versus Specialist shorts, and the ETF inflows roared back in. Here are the numbers:

Mktsentiment. 2/9/2007......5Yr.HI........ LOW

DJIA ………. 12580...........12653...........7286
Nasdaq………. 2459............2502............1114
S&P500…….. 1438............1430............776

CBOE Equity put/call .61............87-5/04........46-1/03

VIX ………. 11.1.........44 9/02........10.0-11/06

ISEE-call/put ……. n/a...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……-7...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 888...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..52.2...........62.9-12/04......35-6/06
Bear:………… 22.2 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….46.2/30.....n/a n/a
MarketVane Bulls…. 72......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.2/38.7
Bullish%- ………78...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

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CycleAnalysis

PARALLEL UNIVERSE:

Paradoxes abound - the world seems awash with liquidity, yet Barrons reports Money Market Cash and Funds' portfolio Cash is at least at 1 year lows; we have a negative 1% Savings rate (worst since the Depression), yet people still have money. Stocks are only at 10% of Household assets, versus 23% in '00.
Complacency increases with a lowering of Public/NYSE Specialist shorting, increasing AAII Bulls, the UBS Investor confidence rising over 100, and the VIX right at 10.
Please see below:

Mktsentiment. 2/2/2007......5Yr.HI........ LOW

DJIA ………. 12653nh...........12653...........7286
Nasdaq………. 2475............2502............1114
S&P500…….. 1448............1430............776
CBOE Equity put/call .62............87-5/04........46-1/03

VIX ………. 10.1.........44 9/02........10.0-11/06

ISEE-call/put ……. 97...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……39...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 789...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..53.3...........62.9-12/04......35-6/06
Bear:………… 21.1 .........38.2-3/03.......16-6/03

AAII-Bull/Bear …….46.3/30.5.....n/a n/a
MarketVane Bulls…. 70......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………32.2/38.7
Bullish%- ………76...............88 -2/04...... 46-8/04

*Insider corporate sellers 39:1, up from 20:1 in Nov.
**UBS Confidence and Consumer Confidence Surveys at 5 year highs-103
***Schwab Daily Average Trades at 250k, same area as in 2000 (2002 was 140K).

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

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PARALLEL UNIVERSE:

Groundhog Day? Same old,same old:

Despite a Volatility hiccup last week (largest up and down days of this young year) most of the Sentiment Indicators remain in a zone.
The global liquidity struggle is between lessening inflows from our mid-East and other Oil suppliers earning 33% less on their product (poor chaps), and Asia's wait and see attitude on our bonds/rates; the positive side is our seasonal inflows from bonuses, retirement contributions and tax returns, which, in most mutual funds, are mandated to be put to use - managers don't get paid to watch Money Market Funds.
In a very interesting Schwab Internet call last week, among other things, they reported that we now have the lowest Supply of stocks since 1988, mainly due to Private Equity takeovers and minimal IPOs last year.
For the week, standouts include the UBS Confidence survey, which breached the 100 mark for the first time in months ( it was in the 50s when the long rally started in June-Sept.).
On the Bull side, CBOE's put/call ratio jumped to a recent high of 64, the AAII Bears jumped 6 points to 33.3%, and Public to NYSE Specialist shorting nearly reached to old high of 7.84 with its 7.53 reading.
Below is the weekly summary:

Mktsentiment. 1/19/2007......5Yr.HI........ LOW

DJIA ………. 12487...........12556...........7286
Nasdaq………. 2435............2502............1114
S&P500…….. 1422............1430............776
CBOE Equity put/call . 64.............87-5/04........46-1/03

VIX ………. 11.1.........44 9/02........10.0-11/06

ISEE-call/put ……. 147...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……-9...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 676...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..52.7...........62.9-12/04......35-6/06
Bear:………… 20.9 .........38.2-3/03.......16-6/03

AAII-Bull/Bear ……. 39.5/33.3.....n/a n/a
MarketVane Bulls…. 70......... 73..............24

Birinyi Blogger
Bull/Bear Poll …………21.6/45.9

Bullish%- ………74...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

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Groundhog Day? Same old,same old:

JANUS, THE TWO-FACED GOD:

After an Up-Escalator Fall, we can now blame this month's volatility on Janus, January's namesake, and Monday's downmove on reaction to Friday's option expiry. The Hirsch Almanac states that so goes January, so goes the year, although this is slightly flawed since the year contains January, giving it a head start in either direction.
Since Barron's has seen fit to delete the Citi/Smith-Barney Panic/Euphoria Index, it is being replaced by Birinyi's tickersense.typepad.com Blogger's poll of sophisticated investment writers. Time will tell if it is a contrary or direct indicator. We start this out with 21% Bulls and 45% Bears.
Standouts last week were the new highs on the Dow and good breadth on large caps. Although the Inv.Intell. Bulls dropped from 55 to 50%, the AAII Bulls jumped up from 44 to 57%, while Bears dropped from 34 to 27% -quite a gap.
Mutual fund and ETF inflows have turned around to increasing (could be Bearish with public entering). And Insider Selling has increased to 39:1, and the U. of Michigan Confidence number at 98 is a 3-year high.
Here is the grid:
Mktsentiment. 1/19/2007......5Yr.HI........ LOW

DJIA ………. 12565nh...........12556...........7286
Nasdaq………. 2451............2502............1114
S&P500…….. 1430............1430............776
CBOE Equity put/call . 57.............87-5/04........46-1/03

VIX ………. 10.4.........44 9/02........10.0-11/06

ISEE-call/put ……. 139...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……6...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 692...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..50.5...........62.9-12/04......35-6/06
Bear:………… 22.1.........38.2-3/03.......16-6/03

AAII-Bull/Bear ……. 57.6/27.3.....n/a n/a
MarketVane Bulls…. 70......... 73..............24

Birinyi Blogger
Bull/Bear Poll.................21.6/45.9
Bullish%- ………74...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

Subscribe in a reader

JANUS, THE TWO-FACED GOD:

ONWARD AND UPWARD:

Those fortunate enough to attend the very civilized TSAA meeting last
week at Alfred's steak house in San Francisco got to hear Joe Turner of
Pring/Turner Mgmt. talk about the 4-year cycle, and the current market's
position in it. He opined that despite the anomaly of both Bonds and
Commodities (inflation) rising simulataneously, we should be on the verge
of Stage VI, which is Bearish for all securities - bonds, stocks and
commodities.
While breaking to new millenium highs we are also seeing some Bearish
tones in the Indicators: the CBOE put/call at 61; AAII Bears rising 5 %
to 34.3; short interest near its highs.
On the other hand, CyberTrader reports very low mutual fund cash and
extreme margin debt, at levels similar to 2000.
At some point the lower
price of oil, great for consumers and transportation, but a dangerous
negative for inflows from our oil-supplying countries, cold trigger
Turner's bearish scenario.
Here are the numbers:

Mktsentiment. 1/12/2007......5Yr.HI........ LOW

DJIA ………. 12556nh...........12556...........7286
Nasdaq………. 2502nh............2502............1114
S&P500…….. 1430............1430............776
CBOE Equity put/call . 61.............87-5/04........46-1/03

VIX ………. 10.15.........44 9/02........10.0-11/06

ISEE-call/put ……. 154...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……7...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 692...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..55.4...........62.9-12/04......35-6/06
Bear:………… 20.7.........38.2-3/03.......16-6/03

AAII-Bull/Bear ……. 44.3/34.3.....n/a n/a
MarketVane Bulls…. 68......... 73..............24

Barron's Panic/
Euphoric Master Idx…. na........-0.24 4/06.....-0.75 11/05

Bullish%- ………74...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

Subscribe in a reader

ONWARD AND UPWARD:

FACE THE BARRONS WASTE:

Barron's has reduced the size of its weekly paper (its presses print the newly reduced WSJ), has rearranged the deck chairs inits Market Lab, and eliminated the Master Indicator - the Citi Panic/Euphoria Index, which rarely surfaced above the Panic line. So this Indicator will probably go away, although I have an e-mail in to them, and have checked Citi's and Smith Barney's websites to no avail. Although flawed, its recent high reading did foretell the recent selloff.
Breadth-wise, the McClellan Oscillator is down near that -50 support normal area, which bodes for at least a halt in the decline, although many other Indicators are coming down off overbought readings, including the Summation Index, the Bullish percent, and newsletter surveys. The AAII, however, widened its spread of Bull/Bears, with the Bears at 29%, well off the 40s recent levels.
Here are the numbers:

Mktsentiment. 1/05/2007......5Yr.HI........ LOW

DJIA ………. 12398...........12463...........7286
Nasdaq………. 2434............2460............1114
S&P500…….. 1409............1427............776
CBOE Equity put/call . 56.............87-5/04........46-1/03

VIX ………. 12.14.........44 9/02........10.3-7/05

ISEE-call/put ……. 150...........299-12/04.......82-4/02
(>200/Bearish)

McClel Osc.(+75/-100)……-48...............91-5/04.........(81)-5/04
McClelSum.(+750/-1153nh) 782...........1568-6/03.......(726)-5/04

Newsletter Surveys:
Inv.Intel -Bull:…..…. ..55.3...........62.9-12/04......35-6/06
Bear:………… 21.3.........38.2-3/03.......16-6/03

AAII-Bull/Bear ……. 49/29.....n/a n/a
MarketVane Bulls…. 69......... 73..............24

Barron's Panic/
Euphoric Master Idx…. na........-0.24 4/06.....-0.75 11/05

Bullish%- ………73...............88 -2/04...... 46-8/04

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: brentleonard.com 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 Amazon.com: Zero (IN)Tolerance

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FACE THE BARRONS WASTE: