EARLY EDITION:

Due to an early start of a vacation (along with the rest of the world), here is an abbreviated Sentiment update: specifically newsletter surveys that come out mid-week.
Since rising to the April 2 high on the SPX of 1422 it again hit that  number Monday with a Candlestick Hammer. Despite that the Inv.Intell. Bull/Bear, and especially the AAII one are both getting stretched to the complacency side. Both the McClellan Oscillator and Summation are only halfway to a speculative top yet; the Bullish % is getting close to a top.
Followers of my DITM (deep-in-the-money) covered call strategy can see how one can make a profit even if the stock drops, at:    http://www.examiner.com/stock-market-in-san-francisco/brent-leonard
DITM is IMO the optimal strategy in a sideways to down market, which has been the case since the October '07 high, and probable future. More also at:

http://ditmcalls.blogspot.com

Here are the numbers:

Date>		8/23/12thurs	8/17/2012
Indices:	DJIA	xxx	13275
	NAZ	xxx	3076
	SPX	xxx	1418
NASD/NYSE	WklyVolume (Bshs).		8.0/2.8
nasd/nyse	Specul.Ratio hi=bullish xx		2.86
Sentiment:	put/call-CBOE	xx	61
Barron's	VIX>50-alltmlow=8.8		13.5
	Advance/Dec-NYSE.. xx		1995/1157
	Weekly Net:	xx	838
	Cumulative:  xx		139955
Weekly	NYSE hi/low	xx	359/45
New Hi's/Low's	Nasdaq h/l	xx	190/125
McClellan	Oscillator	-9	29
McClellan Sum	.+750/-1000	667	656
Newsletter	Inv.Intel -Bull:tues	47.3	43.6
Surveys	Bear:-5yrs	24.7	26.6
	AAII  -Bull :wed.	42	36.8
	Bear	25.9	28.1
COT:Change w/w	large/small (net)k		1/(1)
CEOinsider	selling		25:1
BalticDryIndex	GlobalEcon		discont.
3-box rev	Bullish%-	70	70
US equity -ICI	Fund Flows	1 wk lag	1 wk lag
MMF flows	Change in $B		11.7B
MargDebt- top (300M)	monthly	JUNE: 284 B
ETF:Eqty/Int'l/Bond	million$$ .	JUNE: 686/258/222
2-yr Tsy Yield: Inflation		0.28%	0.30%

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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EARLY EDITION:

LAZY DAYS:

Sentiment numbers have regressed to the norm in most cases over the past week of low Volume ( elsewhere I pointed out that Volume is measured in shares, not capitalized weighting, so higher prices in AAPL, low priced banks, et.al., are not reflected exactly). Also, there has been some funny bifurcation at Barron's Market Lab statistics on Volume, so my one extreme outlier this week - record speculative Volume vis-a-vis NASD compared to NYSE- may not symbolize anything, as all other Indicators have tamed down. Breadth remains strong, and the Bullish % at 70 is getting a bit high!
Those readers who follow my DITM blog:

http://ditmcalls.blogspot.com

are advised that following my return, I may be transferring it to my new effort - writing for Seeking Alpha (see link below).

http://seekingalpha.com/article/813991-seeking-yield-and-safety

Next week I leave early on vacation so the report will be truncated to those available.
Here are the numbers:

Date>		8/17/2012	8/10/2012
Indices:	DJIA	13275	13207
	NAZ	3076	3020
	SPX	1418	1405
NASD/NYSE	WklyVolume (Bshs).	8.0/2.8	8.5/3.1
nasd/nyse	Specul.Ratio hi=bullish	2.86	2.70
Sentiment:	put/call-CBOE	61	61
Barron's	VIX>50-alltmlow=8.8	13.5	14.7
	Advance/Dec-NYSE..	1995/1157	2020/1117
	Weekly Net:	838	903
	Cumulative:	139955	139117
Weekly	NYSE hi/low	359/45	495/51
New Hi's/Low's	Nasdaq h/l	190/125	208/134
McClellan	Oscillator	29	17
McClellan Sum	.+750/-1000	656	601
Newsletter	Inv.Intel -Bull:tues	43.6	43.6
Surveys	Bear:-5yrs	26.6	25.5
	AAII  -Bull :wed.	36.8	36.5
	Bear	28.1	27.4
COT:Change w/w	large/small (net)k	1/(1)	6/(5)
CEOinsider	selling	25:1	45:1
BalticDryIndex	GlobalEcon	discont.
3-box rev	Bullish%-	70	67
US equity -ICI	Fund Flows	1 wk lag	(3.6B)
MMF flows	Change in $B	11.7B	10.9B
MargDebt- top (300M)	monthly	JUNE: 284 B
ETF:Eqty/Int'l/Bond	million$$ .	JUNE: 686/258/222
2-yr Tsy Yield: Inflation		0.30%	0.26%

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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LAZY DAYS:

REASONS TO BE BULLISH:

The recent uptrend in stocks (except on Mondays) is heartening; Volumes from Nasdaq vs. NYSE hit a record for speculation last week showing Risk On. More on Volume behavior in my Examiner column:
 

http://www.examiner.com/stock-market-in-san-francisco/brent-leonard

Breadth has been strong lately (New highs 10:1 on the NY; Nasdaq turning positive). In the Barron's Option column, Larry McMillan states that the AAII Bull/Bear ratio has only been this positive 4 times over the past 15 years - Oct. '98, March '03, '08, & '09 - all starting new rallies. VIX futures - VXX are also accommodative.  

Here are the numbers:

Date>		8/10/2012	8/3/2012
Indices:	DJIA	13207	13096
	NAZ	3020	2967
	SPX	1405	1390
NASD/NYSE	WklyVolume (Bshs).	8.5/3.1	8.5/4.1
nasd/nyse	Specul.Ratio hi=bullish	2.70	2.07
Sentiment:	put/call-CBOE	61	69
Barron's	VIX>50-alltmlow=8.8	14.7	15.6
	Advance/Dec-NYSE..	2020/1117	1754/1383
	Weekly Net:	903	371
	Cumulative:	139117	138214
Weekly	NYSE hi/low	495/51	517/114
New Hi's/Low's	Nasdaq h/l	208/134	176/201
McClellan	Oscillator	17	4
McClellan Sum	.+750/-1000	601	508
Newsletter	Inv.Intel -Bull:tues	43.6	39.4
Surveys	Bear:-5yrs	25.5	27.7
	AAII  -Bull :wed.	36.5	30.4
	Bear	27.4	34.9
COT:Change w/w	large/small (net)k	6/(5)	2/(3)
CEOinsider	selling	45:1	12:01
BalticDryIndex	GlobalEcon		discont.
3-box rev	Bullish%-	67	68
US equity -ICI	Fund Flows	1 wk lag	(5.7B)
MMF flows	Change in $B	10.9B	(4.0B)
MargDebt- top (300M)	monthly	JUNE: 284 B
ETF:Eqty/Int'l/Bond	million$$ .	JUNE: 686/258/222
2-yr Tsy Yield: Inflation		0.26%	0.25%

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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REASONS TO BE BULLISH:

PRESIDENTIAL RALLY:

In my July 12 column for the Examiner.com

(http://www.examiner.com/stock-market-in-san-francisco/brent-leonard)

I wrote about a chart from Ned Davis - NDR Research -  showing stock markets during incumbents' , non- incumbents', and all election years. In the current period - July through October, all three had rises of varying degrees. That is the good news. The divergence comes after Oct.1, when, if Obama loses, the market is due to tank for the remainder of the year. Of course, there are always exceptions!
( tried to paste the chart on this blog but it would not take it - I will attach it to my email alert subscribers).

Merrill Lynch notes that due to the flight to safety (?) of Treasurys, stock investors percentage is the lowest since 1985; also Wall Street strategists, as opposed to analysts, are only recommending 44% in stocks, a 25-year low (56% is usually a BUY signal).

Despite last week's late huge rally, stocks were down slightly for the week - mostly affecting newsletter surveys, which come out Tues. and Wed. Still, the AAII Bull/Bear ratio is still inverted a bit. MMF inflows reversed to outflows; breadth remained strong, but most others were tame.

Here are the numbers:

Date>		8/3/2012	7/27/2012
Indices:	DJIA	13096	13075
	NAZ	2967	2958
	SPX	1390	1385
NASD/NYSE	WklyVolume (Bshs).	8.5/4.1	9.0/4.1
nasd/nyse	Specul.Ratio hi=bullish	2.07	2.19
Sentiment:	put/call-CBOE	69	68
Barron's	VIX>50-alltmlow=8.8	15.6	16.7
	Advance/Dec-NYSE..	1754/1383	1893/1269
	Weekly Net:	371	624
	Cumulative:	138214	137843
Weekly	NYSE hi/low	517/114	411/190
New Hi's/Low's	Nasdaq h/l	176/201	138/255
McClellan	Oscillator	4	16
McClellan Sum	.+750/-1000	508	544
Newsletter	Inv.Intel -Bull:tues	39.4	40.4
Surveys	Bear:-5yrs	27.7	26.6
	AAII  -Bull :wed.	30.4	28.1
	Bear	34.9	43.1
COT:Change w/w	large/small (net)k	2/(3)	(2)/(14)
CEOinsider	selling	12:01	15:01
BalticDryIndex	GlobalEcon	discont.
3-box rev	Bullish%-	68	61
US equity -ICI	Fund Flows	1 wk lag	(2.1B)
MMF flows	Change in $B	(4.0B)	16.2B
MargDebt- top (300M)	monthly	JUNE: 284 B
ETF:Eqty/Int'l/Bond	million$$ .	JUNE: 686/258/222
2-yr Tsy Yield: Inflation		0.25%	0.26%

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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PRESIDENTIAL RALLY:

LET'S GET READY TO RALLY!:

If CON is the opposite of PRO, is Congress the opposite of Progress? Set to go on recess August 6, we can expect the markets to excel ( helped by the fact that they usually go on recess during Holidays when people are feeling good about things). Congressional gridlock also seems to help markets, as Congress fails to inhibit them.
Thanks to last week's two day huge rally, the SPX is back in the upward trend channel, with 1420 the current upper band. Changes in the Sentiment Indicators were miniscule, with the AAII Bears increasing  a bit (as did the Bulls!). Mutual Fund equity flows were basically unchanged - the first time since June 1 that they were not negative. Money market flows made a huge reversal from negative $12B to positive $16B.
Here are the numbers:
 

Date>		7/27/2012	7/20/2012
Indices:	DJIA	13075	12822
	NAZ	2958	2925
	SPX	1385	1362
NASD/NYSE	WklyVolume (Bshs).	9.0/4.1	8.4/3.8
nasd/nyse	Specul.Ratio hi=bullish	2.19	2.21
Sentiment:	put/call-CBOE	68	69
Barron's	VIX>50-alltmlow=8.8	16.7	16.3
	Advance/Dec-NYSE..	1893/1269	1679/1470
	Weekly Net:	624	209
	Cumulative:	137843	137219
Weekly	NYSE hi/low	411/190	520/102
New Hi's/Low's	Nasdaq h/l	138/255	242/164
McClellan	Oscillator	16	1
McClellan Sum	.+750/-1000	544	668
Newsletter	Inv.Intel -Bull:tues	40.4	43.6
Surveys	Bear:-5yrs	26.6	24.5
	AAII  -Bull :wed.	28.1	22.2
	Bear	43.1	41.8
COT:Change w/w	large/small (net)k	(2)/(14)	3/(12)
CEOinsider	selling	15:01	17:1
BalticDryIndex	GlobalEcon
3-box rev	Bullish%-	61	61
US equity -ICI	Fund Flows	1 wk lag	0
MMF flows	Change in $B	16.2B	(12.2B)
MargDebt- top (300M)	monthly
ETF:Eqty/Int'l/Bond	million$$ .
2-yr Tsy Yield: Inflation		0.26%	0.21%

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

LET'S GET READY TO RALLY!:

BAD NEWS:

TV News anchors usually start their broadcasts with "Good Evening" and then tell you why it isn't! Negativity abounds all over the globe and the market is reflecting it. Having been in a Bull rally (higher highs and lows) since June 4 - hard to believe- it finally broke the uptrend channel on July 12, then again today, creating what Technicians call Fan Waves.
As seen below we again have a mixed picture: the NYSE to NAZ Volume is getting speculative (toppy), while breadth is surging - my cumulative A/D and New Highs are powerful breadth numbers.
However, Put/call ratios are still high, and the AAII Bulls dropped greatly - to 22 (both Bullish FOR the market).

For those interested, both links below are also updated today:

http://ditmcalls.blogspot.com Note the TSAA monthly meeting this week: http://www.examiner.com/stock-market-in-san-francisco/brent-leonard
Date> 7/20/2012 7/13/2012 Indices: DJIA  12822 12777 NAZ  2925 2908 SPX  1362 1356 NASD/NYSE WklyVolume (Bshs). 8.4/3.8 7.7/3.6 nasd/nyse Specul.Ratio hi=bullish 2.21 2.14 Sentiment: put/call-CBOE  69 72 Barron's VIX>50-alltmlow=8.8 16.3 16.7 Advance/Dec-NYSE.. 1679/1470 1619/1541 Weekly Net: 209 78      Cumulative: 137219 137010 Weekly  NYSE hi/low 520/102 485/93 New Hi's/Low's Nasdaq h/l 242/164 235/140 McClellan  Oscillator 1 21 McClellan Sum .+750/-1000 668 579 Newsletter Inv.Intel -Bull:tues 43.6 44.7 Surveys Bear:-5yrs 24.5 24.5 AAII  -Bull :wed. 22.2 30.2 Bear  41.8 34.7 COT:Change w/w large/small (net)k 3/(12) 0/(11) CEOinsider selling 17:1 32:1 BalticDryIndex GlobalEcon 3-box rev Bullish%-  61 57 US equity -ICI Fund Flows 1 wk lag (1.5B) MMF flows Change in $B (12.2B) 18.6B MargDebt- top (300M) monthly  ETF:Eqty/Int'l/Bond  million$$ . 2-yr Tsy Yield: Inflation 0.21% 0.25%

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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BAD NEWS:

ELECTION RESULTS:

In a recent Bloomberg interview, Canaccord Financial's Tony Dwyer exhibited a chart from Ned Davis Research on market performance in Election years since 1900 ( 28 years meets the typical analysts' sample size of @ 30). The interview can be accessed on Bloomberg's website - search Tony Dwyer . A blow by blow report is also on my Examiner.com column from last week:

http://www.examiner.com/stock-market-in-san-francisco/brent-leonard

According to the model (not available here) the market is expected to rally into October 1 - the strength of the rally dependent on whether the incumbent is expected to be re-elected or not - after that there is a dramatic divergence: if the incumbent is successful, the rally continues into year end with a huge surge; if not, it dramatically sells off into the November 6 election, then enters a trading range.

Despite triskadekaphobia, the market reversed a terrible week, but breadth continued to make new records in my cumulative Advance/Decline stat; Investor Intelligence Bull/Bears ratio widened to even more Bullishness.

On the positive side, the CBOE put/call ratio went back to a high 72; MMFs reversed money flows with an $18B Inflow; and CEO Insider selling remained high (very few buyers). If anyone is skeptical of the importance of the Inv.Intell. and AAII Bull/Bear signal, one can only check the past years extremes:

Most Bulls - 2/10/12

Most Bears - 4/25/12

Least Bears - 9/30/11

Least Bulls 5/30/12

All resulted in proper turning points to some extent.

Here are the numbers:

 

Date>		7/13/2012	7/6/2012
Indices:	DJIA	12777	12772
	NAZ	2908	2937
	SPX	1356	1354
NASD/NYSE	WklyVolume (Bshs).	7.7/3.6	5.7/2.5
nasd/nyse	Specul.Ratio hi=bullish	2.14	2.28
Sentiment:	put/call-CBOE	72	69
Barron's	VIX>50-alltmlow=8.8	16.7	17.1
	Advance/Dec-NYSE..	1619/1541	2030/1126
	Weekly Net:	78	904
	Cumulative:	137010	136932
Weekly	NYSE hi/low	485/93	513/22
New Hi's/Low's	Nasdaq h/l	235/140	297/71
McClellan	Oscillator	21	47
McClellan Sum	.+750/-1000	579	519
Newsletter	Inv.Intel -Bull:tues	44.7	42.5
Surveys	Bear:-5yrs	24.5	24.5
	AAII  -Bull :wed.	30.2	32.6
	Bear	34.7	33.3
COT:Change w/w	large/small (net)k	0/(11)	(2)/(10)
CEOinsider	selling	32:1	34:1
BalticDryIndex	GlobalEcon		discont.
3-box rev	Bullish%-	57	60
US equity -ICI	Fund Flows	1 wk lag	($3.1)
MMF flows	Change in $B	18.6B	3.3B
MargDebt- top (300M)	monthly		May
ETF:Eqty/Int'l/Bond	million$$ .		May
2-yr Tsy Yield: Inflation		0.25%	0.28%

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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ELECTION RESULTS: