YEAR-END REBALANCE:

Now seems a good time of year to look at the Sentiment Indicators and do some rebalancing: it seems that Barron's/NYSE is charging institutional fees for some data, so the diminishing Specialist to Public shorting is going the way of the P-Coast option market makers (in favor of electronic trading); added to the list, for now, is the very high Market Vane Bullish T-Bond number, at 91, which would at some point be Bearish for Treasuries. Also noted this week, the Baltic Dry Index is repeated at 818, a suspect number possibly due to indolence.
During this holiday, low-Volume period, most extremes are coming off their highs to the mean; the McClellan Oscillator remains Bearish - still above 50; yet the Inv. Intell. bull/bear ratio remains "bearly" inverted - a Bullish sign.
Most of us are just waiting for this dismal year to end, and hope that the "Change" is for the better!

MktSentiment. 12/26/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8515…….8579………..14093............7286
Nasdaq………. 1530…… 1564…………2810.............1114
S&P500…….. 872……… 888………….1561………..776
CBOE Eq. put/call ……60………… 72………..…96-10/08….....46-1/03

VIX ………. 43…………46…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………51……………58……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-377………..-509……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…35.1………….26.9……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 38.2…………47.3……………..………… 54.4.10/08.......16-6/03
AAII-Bull/Bear ……29.0/43.6…..39.7/35.6…....……..n/a n/a
Market Vane - T-Bond..91………….91……………..91
Baltic Dry Index ……818?…………818…………………………………663
Public/NYSE Spec.-…discont. n/a (pay svc).. … …….……22-10/08…………9.5
Bullish%- …….…54…………….60……………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 5.4:1…..4.8:1…. ………..97………….2.4:1 (11/08)
Mutual Fund Inflows (1.3B)………(7.8B)
ETF InflowsL……….7.6B……….16.2B……
Money Market Inflows: 28B……….(2B)… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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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YEAR-END REBALANCE:

BELGIAN WAFFLE:

This just in - unemployment rises as the entire government of Belgium resigns under royal pressure over the handling of Fortis. Not a bad idea - maybe we should think about that in lieu of the mess ours has got us into, including the SEC, who, when they finally do something, such as remove the uptick rule, it's wrong.
So far, the mass majority opinion of a year-end rally has not presented itself yet (maybe the Santa Claus rally after Christmas), and sentiment is skewed to Bullish on the market (which is Bearish for the market). The McClellan Oscillator is above 50 and rising; the VIX is actually dropping as the market does, a rarity. Flipping over the zero line last week were the AAII Bulls to a majority (the Inv.Intell. are still very Bearish), and the money market outflows (from recent large inflows).
Maybe with Helicopter Ben going ALL IN with zero interest rates (didn't Japan try that a couple of decades ago?), we'll have a happy new year rally as our gov't (I'm here to help you) forces people out of money market funds and CDs into riskier investments.
Let's get this year over with, and start over!!!

MktSentiment. 12/19/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8579……..8629………..14093............7286
Nasdaq………. 1564…….1540…………2810.............1114
S&P500…….. 888……….879………….1561………..776
CBOE Eq. put/call …… 72…………79………..…96-10/08….....46-1/03

VIX ………. 46…………54.3…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………58……………52……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-509………..-765……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…26.9…………..25.3……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 47.3………….46.2…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……818………….764…………………………………663
AAII-Bull/Bear ……39.7/35.6……37.5/39.8…....……..n/a n/a
Public/NYSE Spec.-…n/a (pay svc).. 9.5nl… …….……22-10/08…………9.5
Bullish%- …….…60…………..52sell……………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 4.8:1…..10:1…. ………..97………….2.4:1 (11/08)
Mutual Fund Inflows (7.8B)………. (3.9B)
ETF InflowsL……….16.2B……….9.7B……
Money Market Inflows: (2B)……….32B… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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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BELGIAN WAFFLE:

CHICAGO: BRING BACK AL CAPONE!:

It seems that all the players, Republicans and Democrates, are getting their balls off the playing field before the Obamanation levels it in the coming years - legally or illegally. Money continues to flow out of stock mutual funds and into Money Market funds and Treasurys, for little or no return. 50% of foreign-owned Treas. are 3 years or less and will need to be rolled. QTD, stocks are down 22%, Treas. up 13%.
This week's Bullish readings "for" the market include a high CBOE put/call ratio, very high SDS (the S&P500 double-short ETF) Volume, and both the Baltic Dry Index (global economy proxy) and exchange short interest rose slightly, a reversal. Also, both newsletter surveys remain inverted to the Bear majority.
The downside includes the McClellan Oscillator above 50, Public to Specialist shorting at a new low, and a sell signal on the Bullish % chart (3 boxes down).
Here are the stats:
MktSentiment. 12/12/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8629……..8635………..14093............7286
Nasdaq………. 1540……..1509…………2810.............1114
S&P500…….. 879……….. 876………….1561………..776
CBOE Eq. put/call …… 79………….75………..…96-10/08….....46-1/03

VIX ………. 54.3………. 60…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………52…………….64……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-765………..-1089……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…25.3…………….23.1……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 46.2……………49.5…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……764……………663nl…………………………………663
AAII-Bull/Bear ………37.5/39.8……..31.3/44.9…....……..n/a n/a
Public/NYSE Spec.-… 9.5nl……….. 13.0nl… …….……22-10/08…………9.5
Bullish%- …….…52sell…………..31………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 10:1……4:1…. ………..97………….2.4:1 (11/08)
Mutual Fund Inflows (3.9B)……….(2.5B)
ETF InflowsL……….9.7B…………2.8B……
Money Market Inflows: 32B……….28B… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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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CHICAGO: BRING BACK AL CAPONE!:

BULL**** PER CENT?:

The usually reliable Bullish per cent Pt.& Fig. indicator, which uses the material 1-point, 3-Box reversal for its trend changes, falls victim to the record Volatility of this market the past 3 months. It has, however, kept one in the trend, and hopefully will predict, by using a 45-degree down trending tops line, showing us a downside reversal at @46% (it is currently at 36%-Buy).
After a 100-pt. SPX rally in December, despite the money thrown at ubiquitous financial problems, it should be getting tired even in a year-end rally.
Although the newsletter surveys, through gloomy Wednesday, are tremendously bullish for the market, the McClellan Oscillator at 64 calls for overbought selling, and the Baltic Dry Index of global shipping hits another new low causing huge discount cuts accross Europe. Public to NY Specialist shorting hit another new low last week at 13:1.
Here are the stats:

MktSentiment. 12/05/08 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8635…….. 8829………..14093............7286
Nasdaq………. 1509…..…1535…………2810.............1114
S&P500…….. 876……….896………….1561………..776
CBOE Eq. put/call …… 75………….63………..…96-10/08….....46-1/03

VIX ………. 60…………55…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………64…………….73……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1089……….-1362……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…23.1…………..31.3……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 49.5………….44.1…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……663nl…….715…………………………………................663
AAII-Bull/Bear ………31.3/44.9….24.4/57.1…....……..n/a n/a
Public/NYSE Spec.-… 13.0nl……… 13.7nl… …….……22-10/08…………13.0
Bullish%- …….…31………….…8………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 4.0…… 2.4:1nl…. ………..97………….2.4:1 (11/08)
Mutual Fund Inflows (2.5B)……….(7.1B)
ETF InflowsL……….2.8B………….4.5B……
Money Market Inflows: 28B………...38B… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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

BULL**** PER CENT?:

HEDGES MAKE GOOD NEIGHBORS:

In my recent travels I've had many opportunities to discuss
the stock market debacle with friends and strangers and few
have heard of any way to avoid large losses in their IRAs,
401ks, and family fortunes. Since the media only focuses on
the less popular buy-and-hold (BAH) or market timing
(dangerous in normal markets), they were unfamiliar with
concept of hedging with inverse ETFs, which freeze price
action until the up market resumes. For more information
see www.proshares.com
Although many sentiment indicators are at extremes, or
coming off them, in this long term downtrend they do not
seem to give accurate signals, for now. Last week's near 20%
rally brought the CBOE put/call ratio down from 104 to 63
while the VIX also dropped to a multi-week low of 55.
CEO insider selling dropped to another new low of 2.4:1,
although selling of Finance stocks outnumbered the entire buying
group.
With the advance/decline issues on the NYSE at 3052 to 230, the
McClellan Oscillator swung from -64 to a plus 73, creating a sell
signal in force today. Also indicating oversold was the Bullish %
which swung from 8% of stocks on Buy signals, to 31.
With commercial real estate, malls, offices and condos the next
Denver boot to drop, expect more downside action.
Here are the numbers:

MktSentiment. 11/28/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8829…….8046………..14093............7286
Nasdaq………. 1535……1384…………2810.............1114
S&P500…….. 896……….800………….1561………..776
CBOE Eq. put/call …… 63…. ……..104…….…..96-10/08….....46-1/03

VIX ………. 55………..72.6…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………73……………-64……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1362……….-1500.. ……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…31.3………….30.9……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 44.1………..43.6…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……715………..836………………………………715
AAII-Bull/Bear ………31.3/44.9….24.4/57.1…....……..n/a n/a
Public/NYSE Spec.-… 13.7nl………14.2… …….……22-10/08…………13.7
Bullish%- …….…31………….…8………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 2.4:1nl…. 3.3:1 …. ………..97………….2.4:1 (11/08)
Mutual Fund Inflows (7.1B)……..(3.3B)
ETF InflowsL……….4.5B………6.8B……
Money Market Inflows: .38B……..42B… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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

HEDGES MAKE GOOD NEIGHBORS:

STOCK MARKETS - WILD AND CRAZY GUYS:

These past few weeks have seen market moves not seen in a generation, if ever. The cyclical symmetry to the Great Depression becomes more obvious each day - even the dates: 1929-32, with an Echo bust in 1938 is repeated by 2000-02, 2008.
Although government bailout action trumps the Sentiment signals, aided by hedge fund liquidations and short-covering, several extremes appeared in the past few days:
Although we broke the recent Trading Range (it is possible that this current 10% rally is the common retest to the Support turned Resistance) , several of the indicators below foresaw the rally. New Highs to Lows on the NY and Nasdaq - 5 to 1700; a record 104 on the CBOE put/call ratio, exceeding the OEX ratio; the VIX touched 80 again; the Volume on the SDS (Ultrashort SPX etf) at record numbers, as was the insider buying to selling. Also, the SPX was as far below the 200MA as in 1932.
Finally, the McClellan charts were both oversold, and the Bullish per cent sank to 8.
Still, technicians, such as Mark Liebovit and Louise Yamada, would argue there is farther down to go. And Charles Biderman states that we are not seeing stock buybacks or insider buying so typical at bottoms - down 90% and 24% Y/Y in November.

Here are the numbers:

MktSentiment. 11/21/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8046……8497………..14093............7286
Nasdaq………. 1384…..1516…………2810.............1114
S&P500…….. 800………873………….1561………..776
CBOE Eq. put/call …… 92…..104nh…….…..96-10/08….....46-1/03

VIX ………. 72.6……..66…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………-64…………..-2 ……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1500………-1148.. ……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…30.9…………..31.9……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 43.6………….46.1…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……836………….838 829
AAII-Bull/Bear ………38.3/42.5….24.4/57.1………....……..n/a n/a
Public/NYSE Spec.-… 14.2……….15.7 … …….……22-10/08…………14.1
Bullish%- …….……8……………26………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. 3.3:1….n/a…. ………..97………….3.3:1 (11/08)
Mutual Fund Inflows (3.3B)………(.2B)
ETF InflowsL……….6.8B………..2.8B……
Money Market Inflows: .42B……….23B… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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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STOCK MARKETS - WILD AND CRAZY GUYS:

SEEING RED-GETTING MAD:

It is apparent where the above phrase came from - in recent weeks, the hundreds of stocks, ETFs, Muni CEFs, etc. on the screens are 100% RED, as in down - with an occasional up day. But it is like the traffic light that turns green to let about 5 cars pass, then back to red for a couple minutes in the other direction.
Going on another stress-relief vacation down the California coast, I'm having to post a partial list of indicators this week, catching up near Thanksgiving. Despite the huge swings of this past week, these signals are pretty much the same as last week: exceptions include the recently added Baltic Dry Index (a Global Economy proxy), finally bouncing up a bit; Mutual fund inflows were quiet, but the SDS (inverse SPX etf) Volume was near its high, indicating pessimism.
Here are the numbers- fill in the blanks from Barron's, etc.:

DJIA ………. ………….8943………..14093............7286
Nasdaq………. ……….1647…………2810.............1114
S&P500…….. ………….930………….1561………..776
CBOE Eq. put/call …… ……..82…….…..96-10/08….....46-1/03

VIX ………. …………..56.1…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………-2 (Thurs)….46……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1148..Thurs…-1134……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…31.9………….30.3……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 46.1………….48.3…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……838………..829nl 829
AAII-Bull/Bear ………………..44.8/33.3..……..n/a n/a
Public/NYSE Spec.-… ………19.4… …….……22-10/08…………14.1
Bullish%- ………26…………..43sell………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers. ………6.6:1…. ………..97………….4-10/08
Mutual Fund Inflows (.2B)…………(.5B
ETF InflowsL……….2.8B…………4.6B……
Money Market Inflows: .23B……….138B)… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid to the author from readers clicking on the website and/or the small ad at the top of the column.

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

SEEING RED-GETTING MAD:

OBAMA EARNS HIGH MARX:

President-elect Obama's top priority is to bail out the auto industry, a failed model of share-the-wealthfare of unionized complacency. Just as Japan refused to lose, taking decades to recover, the U.S. is following suit with autos, AIG, consumers - who's next? Bailing out OPEC because of declining oil prices?
Since Wagoner took over GM in 2000 (well before the credit crunch) its stock price has steadily tanked from just under $100 to its current $3 per share, meanwhile receiving millions in compensation . John Mauldin reports that there is now a car for every American adult, thanks to "forward-selling, incentives and rebates".
It took 70 years for the DJIA to reach 1000, but only two days last week to fall that much. Still, some indicators were bullish ON the market:
Although ETF and mutual fund inflows barely moved, Money Market funds gained a near-record $138B, mostly into Gov't funds. The AAII Bulls reverted back to a majority of 44 to 33, although Investors' Intelligence survey stayed cautious at 30 vs. 48, and public shorting rose to 19 over remaining Specialists.
New highs remain single digit, although fewer new lows occurred for the week.
A new indicator - Baltic Dry Index - reached its multi-year low (2001) of 829 last week as this proxy for global economies reflected ships stuck at the dock due to frozen credit.
Here are the numbers:

MktSentiment. 11/07/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8943…………9325………..14093............7286
Nasdaq………. 1647…………1720…………2810.............1114
S&P500…….. 930…………..968………….1561………..776
CBOE Eq. put/call …82……………68…….…..96-10/08….....46-1/03

VIX ………. 56.1………….59.9…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………46…………..72……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1134……..-1441……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…30.3…………23.1……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 48.3…………52.7…..………… 54.4.10/08.......16-6/03
Baltic Dry Index ……829nl 829
AAII-Bull/Bear ……44.8/33.3…….37.1/40.3..……..n/a n/a
Public/NYSE Spec.-…19.4…………17… …….……22-10/08…………14.1
Bullish%- ………43sell…………37………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers.6.6:1…..3.6:1…. ………..97………….4-10/08
Mutual Fund Inflows (.5B)……….(2.3B)…
ETF InflowsL……….4.6B……….(.4B)… ……
Money Market Inflows: .138B……..(3B)… … ………144B

www.mktsentiment.blogspot.com is a free weekly display of important contrary opinion statistics, with the disclosure that eventual fees may be paid from readers clicking on the website and/or the small ad at the top of the column.

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

OBAMA EARNS HIGH MARX:

THE RISE AND FALL:

Maybe there is a reason Autumn is called "FALL" - it seems everything is: stock and housing prices, confidence, temperatures, etc. Is it a coincidence that the highest that the DJIA ever reached was Oct.9, 2007, and the lowest since then was Oct.10, 2008! If the world seems less wealthy these days, it's because the global markets have lost nearly $10 T just in October, with the U.S. $6.5T of it; and the real estate market added a $5T hit recently.
One bright note wast the tremendous success last weekend of the 1st Annual Wyckoff/TSAA Conference, with nearly 200 attendees and speakers from around the world. For the wrapup, go to the TSAASF.org website and see the speakers' notes.
In a more rational world where fund managers aren't racing for the doors ( @ 1/3 hedge funds are expected to call it quits by choice or necessity), Sentiment still seems a bit oversold, even after the huge rally last week. Extremes include: a very negative McClellan Summation Index, although the Oscillator is over bought at +72, up from a minus 38 last week; newsletter survey Investors Intelligence, rarely inverted to the Bear plurality, is more than double the Bulls; and although the Public to Specialist shorting is still high, the Insider selling isa t a record low 3.6:1!
Here are the numbers:

MktSentiment. 10/31/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 9325…………8378………..14093............7286
Nasdaq………. 1720…………1552…………2810.............1114
S&P500…….. 968…………..876………….1561………..776
CBOE Eq. put/call …68……………83…….…..96-10/08….....46-1/03

VIX ………. 59.9…………79nh…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………72…………..-38……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1441………-1514nl……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…23.1………….22.2nl……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 52.7…………54.4nh…..………… 54.4.10/08.......16-6/03

AAII-Bull/Bear ……37.1/40.3……38.7/38.7..……..n/a n/a
Public/NYSE Spec.-…17………….22nh… …….……22-10/08…………14.1
Bullish%- ………37…………….8………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers.3.6:1…….4:1…. ………..97………….4-10/08
Mutual Fund Inflows (2.3B)………200M
ETF InflowsL……….(.4B)……….500M……
Money Market Inflows: .(3B)………17B… ………144B

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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THE RISE AND FALL:

ZUGZWANG- "FORCED MOVE":

In chess, the optimal strategy is to put your opponent into a position in which they can only make one move each time, forcing them into checkmate. In today's markets, the combination of hedge fund and mutual fund redemptions, margin calls, mutual fund tax loss selling, 401k and pension withdrawals and shorting has driven most all the Sentiment Indicators to extremely oversold levels, yet, just as with oscillators, they can stay that way indefinitely.
One only hopes that with the end of the (ugliest) month, the election relief, year-end seasonality, and the DJIA approaching several multi-year support levels, we have seen a Selling Climax and the entry into a Wyckoff-type Trading Range.
For those interested in this, there appears to be only a few spaces left for next weekend's TSAA Annual Seminar on Wyckoff -www.tsaasf.org. -to register.

Some of these Indicator extremes include the VIX at record highs (actually touching 90), CBOE put/call ratios in the 80s; new highs to new lows at incredible 7 to 1000; Bullish percent at 8, after hitting a recent 2% of stocks on buy signals (probably inverse ETFs). Also at record levels - McClellan figures and Investors Intelligence Bears.
Also Bullish FOR the market - public vs. Specialist shorting is quite high and Insider Selling is very low. See below:

MktSentiment. 10/24/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8378…………8852………..14093............7286
Nasdaq………. 1552…………1711…………2810.............1114
S&P500…….. 876………….940………….1561………..776
CBOE Eq. put/call …83……..……..83…….…..96-10/08….....46-1/03

VIX ………. 79nh………….70nh…….…….79..-10/08bull….10.0-7/05 bear

McClellan Osc………-38…………..25……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1514nl…….-1500nl……..…....1568-6/03.......-1514-10/08
Newsletter Surveys:
Inv.Intel -Bull:…..…22.2nl……….22.4nl……….…63 (12/04bear)......22.2-10/08bull
Bear:………… 54.4nh……..52.9…..………… 54.4.10/08.......16-6/03

AAII-Bull/Bear ……38.7/38.7……40.9/39.8..……..n/a n/a
Public/NYSE Spec.-…22nh………14.1… …….……22-10/08…………14.1
Bullish%- ………8……………18………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers.4:1……..7:1 …. ………..97………….4-10/08
Mutual Fund Inflows 200M…….(14.2B)…
ETF InflowsL……….500M…….4.3B……
Money Market Inflows: .17B……..58B… ………144B

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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ZUGZWANG- "FORCED MOVE":

FACE THE "BARRON'S" WASTE:

After returning from the San Diego area, where a Barron's copy is as rare as a home buyer, I've finally sifted through several issues and 100+ e-mails to update the Sentiment picture.
If the recent indicators are not climactic, I don't know what are - the Bullish per cent, based on number of stocks on Buy signals, reached a record +2!; the McClellan Summation hit -1500 while its concomitant Oscillator dropped to -100 at one point; finally, the VIX hit an intraday record high of 85.
There are probably several reasons for stocks circling the drain, foremost among them are the Sept. redemptions from the 8,000 hedge funds, the seasonal Oct. lows, which normally end in rallies, especially with a non-incumbent election on the horizon, with the Nov.-Jan. optimal market window to follow. On top of these is the mutual fund selling, larger than last January's huge market selloff of $13B for the week. This is also the time of year that these mutual funds do their tax loss selling.
Both the crashes of 1834 and 1929 saw "Echo" busts within a decade (1973's and 1987's were a milder echo as the economy wasn't as much in jeopardy) , so the current downturn was not exactly a Black Swan.
Although Barron's reports many insiders actually buying their companys' stock, others, such as in housing, etc. are getting margin calls to liquidate. Stocks such as GM, etc. that fall below $5 are no longer marginable and must be paid in full, like an option.
To wrap up, although many indicators were climactic, they can remain in the zone, much like oversold oscillators, until other technical indicators forecast a move up or down out of the new accumulation or re-distribution trading range.
Here are the numbers for the past two weeks, plus the 5-year highs and lows:
MktSentiment. 10/17/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 8852…………8451………..14093............7286
Nasdaq………. 1711…………1649…………2810.............1114
S&P500…….. 940…………..899………….1561………..776
CBOE Eq. put/call …83…………..96nh……..…..96-10/08….....46-1/03

VIX ………. 70………….70nh…….…….70..-10/08bull….10.0-7/05 bear

McClellan Osc………25……….-100……………..91 -5 /04 bear...(-100)-10/08bull
McClelSum……….…-1500nl……-1200……..…....1568-6/03.......-1500
Newsletter Surveys:
Inv.Intel -Bull:…..…22.4nl………25.3 ……….…63 (12/04bear)......22.4-10/08bull
Bear:………… 52.9………..53nh…..………… 53.10/08.......16-6/03

AAII-Bull/Bear ……40.9/39.8…..31.5/60.8..……..n/a n/a
Public/NYSE Spec.-…14.1………15… …….……18.5…………14.1
Bullish%- ………18…………2nl………….…88 -2/04bear.....2-10/08bull
*Insider corporate sellers.7:1……n/a…. ………..97………….4
Mutual Fund Inflows (14.2B)……(9.4B)
ETF InflowsL……….4.3B………3.8B……
Money Market Inflows: .58B…….47B… ………144B

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 "BARRON'S" WASTE:

THANK GOD IT'S (SEPT.) OVER:

Traditionally September is the worst month of the year for the stock market (Dec. and Jan. being the best), and this year was no exception. With the Gov't's fiscal year ending, some hedge funds investors seeing the lockup window close to exit their fund, end-of-quarter window dressing, and individual investors espying their 401ks and brokerage statements, we also have this crisis megabill for congress to pass.
After screwing up the Postal Service, Medicare, Social Security, and Welfare, we give them this problem to solve.
The most recent hammer was banning short sales, although short interest has been declining since its peak of 18.6B shares on July 25 of this year. Mutual fund redemptions are the greatest since Jan.'08. NY lows/highs were 15:1 last week, despite the short selling ban on financials, etc. Meanwhile, money market funds suffered a rare $1B decline after the record $144B inflow the previous week. This reflects a shift of the entire $143B from general MM to Treasury MMs.
Here are two Behavioral items to ponder: Paulson gives a high number (an Anchor) just as a salesman does, so that the settle number doesn't seems so bad; on the other hand, a contractor gives a bid for a project (especially in government work) which doubles or triples by the time the "unforeseen" unfolds.
Surprisingly, other than the VIX touching 40, most other Sentiment measures have regressed to the mild mean, unlike the markets.

For the first time in 5 years, I shall be taking a short vacation to southern Calif. and will be away from my data sources, so this blog will be interrupted for 2-3 weeks.

Here are last weeks numbers:

MktSentiment. 9/25/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11143………11388………..14093............7286
Nasdaq………. 2183…………2273…………2810.............1114
S&P500…….. 1213…………1255………….1561………..776
CBOE Eq. put/call …72……………83……………..92-1/08….....46-1/03

VIX ………. 34.7…………32.0…….…….44… 9/02 bull..10.0-7/05 bear

McClellan Osc………-24………….4……………..91 -5 /04 bear...(-81)-5/04bull
McClelSum……….…-597……..-451……..…....1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…37.5……….37.9……….…63 (12/04bear)......35-6/06bull
Bear:………… 40.9………43.7…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……34/45.7……27.2/54.4……..n/a n/a
Public/NYSE Spec.-…16.8……..18.5…….……18.5
Bullish%- ………43sell…….53buy………….…88 -2/04bear.....19bull
*Insider corporate sellers.12:1…..20:1………..97………….4
Mutual Fund Inflows..(9.3B)……(3.9B)…)……
ETF InflowsL……….23.2B……...8.3B……
Money Market Inflows: (1B)……144B…

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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THANK GOD IT'S (SEPT.) OVER:

I'M EVEN, I'M LEAVIN':

This market is difficult enough to analyze/trade without the Gov't "necessarily" stepping in to complicate things. This said, it is doubtful that Sentiment can correctly reflect or predict short term direction when these Deus ex Machina backstops intervene.
First, some salient observations: in June, after a sharp decline, the Pakistani stock market banned shortselling; there was a huge rally, then the decline resumed about an equal distance from the prior leg. How long this "time out" lasts is moot, but, as Louise Yamada points out, more downside beckons. My Point & Figure counts show a descent to 9500 or, breaking that, 8600 DJIA.
In addition to today's large decline (even sans short sellers), foreigners have been repatriating funds from long, short Treasuries and GSEs in force, even since the summer months. Money market funds (before Hank guaranteed them) lost a record $144B vs. a previous week's Inflow of $44B to safety(?). Ironically, the person who invented the first MMF was also the first recently to close it, besotten with Lehman paper.
Anyway, it's comforting to know that the U.S. financial system is now in the hands of the Federal Government that brought us the Postal System, Welfare, Social Security and Medicare.
Despite the massive volatility, the numbers are quite benign - the indices barely changed week over week; put/call went from 86 to 83, although the VIX shot up over 40, closing at 32- so far this year each toppy spike has been Bullish.
Public shorts (until the halt) rose to 18:1 over Specialists, who should be able to short; the SDS (SPX short ETF) weekly Volume was a record 243B . Finally, the surveys, which missed much of the action by reporting on Tuesday, are still Bullishly inverted, with Bears dominating.

MktSentiment. 9/19/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11388……….11421………..14093............7286
Nasdaq………. 2273…………2261…………2810.............1114
S&P500…….. 1255…………1251………….1561………..776
CBOE Eq. put/call …83……………86……………..92-1/08….....46-1/03

VIX ………. 32.0…………25.6…….…….44… 9/02 bull..10.0-7/05 bear

McClellan Osc………4….………-6……………..91 -5 /04 bear...(-81)-5/04bull
McClelSum……….…-451………-237……..…....1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…37.9………..38.2……….…63 (12/04bear)......35-6/06bull
Bear:………… 43.7……….41.6…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……27.2/54.4……29.3/54.9……..n/a n/a
Public/NYSE Spec.-…18.5……….15.3…….……18.5
Bullish%- ………53buy…………..46………….…88 -2/04bear.....19bull
*Insider corporate sellers.20:1……..15:1………..97………….4
Mutual Fund Inflows..(3.9B)………(6.5B)……
ETF InflowsL………..8.3B………..7B……
Money Market Inflows: (144B)…….44.4B

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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I'M EVEN, I'M LEAVIN':

SHATTERED GLASS/STEAGAL:

Once again, Congress, in its inimitable circular firing squad fashion, has done what the 9/11 terrorists could not do - help bring down the capitalist system - first by eliminating the wall between gunslinging investment banks and real banks, whose explicit FDIC guarantee let widows and orphans sleep well at night. Now B of A is buying Merrill Lynch. Then they, and other chickencoop SelfRewardingOrgs abandoned the uptick rule and mandated that mortgage lenders stop "redlining" neighborhoods where police would not even go. No wonder one of the internet Dictionary's definitions of Congress is "sexual intercourse".
Despite the Fear and Loathing brought on by the weekend, Sentiment numbers look surprisingly Bullish - comparing them to my infamous rally call on July 14: the SPX is 12 points away from that summer rally inception; the CBOE put/call ratio is actually 1 pt. higher now at 86 (huge); the VIX, at 25.6 is less than 2 pts. away; the Inv.Intell. survey is still inverted in favor of Bears (rare), and the AAII is almost as bad at 29 vs. 54. Birinyi bloggers, which I sometimes follow, showed a 65 to 21 bear/bull ratio.
Finally, the SDS, which is the short S&P500 ETF, saw weekly Volume not seen since that week in July, and Money Market Funds increased by a large $45B ( they always miss rallies!).
Here are the stats:

MktSentiment. 9/11/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11421………11220………..14093............7286
Nasdaq………. 2261…………2255…………2810.............1114
S&P500…….. 1251…………1242………….1561………..776
CBOE Eq. put/call …86……………73……………..92-1/08….....46-1/03

VIX ………. 25.6………….23.0…….…….44… 9/02 bull..10.0-7/05 bear

McClellan Osc……….-6……………2……………91-5/04 bear...(-81)-5/04bull
McClelSum……….…-237………..-195…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…38.2………….37.8……….…63 (12/04bear)......35-6/06bull
Bear:………… 41.6…………40.0…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……29.3/54.9……37.0/43.2……..n/a n/a
Public/NYSE Spec.-…15.3…………17.3…….….
Bullish%- ………46……………45SELL………….…88 -2/04bear.....19bull
*Insider corporate sellers.15:1…….14:1………..97………….4
Mutual Fund Inflows..(6.5B)………..L(.4B
ETF InflowsL………..7B…………5.1B
Money Market Inflows: 44.4B…….19.3B

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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SHATTERED GLASS/STEAGAL:

THE OPEC (OPAQUE IN FRENCH) "PUT":

The oil group, in its upcoming meeting, threatens to cut supply and keep oil price at $100/bbl or above. In Barron's last week, Charles Maxwell calls for $300 oil in a few years. If so, the slide so beneficial to the economy would end, creating more universal hardship on consumers everywhere. The Baltic Dry Index, a good indicator of global economic growth is hitting new lows - it can be seen at http://www.investmenttools.com/, select BDI.
Also hitting new yearly lows, per Standard and Poors' technician Mark Arbeter's call in the current TSAA Review, is the Utility Index -whatever that may portend.
The DJIA's tessatura, or range, seems to ever widen, with a 350 down day last week and a fizzling 350 up day today based on the gov't bailout. Both the CBOE put/call ratio and VIX rose last week, (noticably puts on banks), though not yet to extremes.
In newsletter surveys, the AAII remained inverted, while the Inv.Intell. Bulls also fell under the Bear number - and the public shorting rose against Specialists - both sets Bullish.
On the downside, Bullish per cent went on a Sell signal - 54 to 45% of stocks on a buy signal - although false whipsaws do happen about once a year for the past 5 years.
Here are the actual numbers:

MktSentiment. 9/4/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11220……….11543………..14093............7286
Nasdaq………. 2255…………2367…………2810.............1114
S&P500…….. 1242………….1282………….1561………..776
CBOE Eq. put/call …73…………….71……………..92-1/08….....46-1/03

VIX ………. 23.0…………..20.6…….…….44… 9/02 bull..10.0-7/05 bear

McClellan Osc……….2……………40……………91-5/04 bear...(-81)-5/04bull
McClelSum……….…-195……….-275…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…37.8…………39.3……….…63 (12/04bear)......35-6/06bull
Bear:………… 40.0…………39.3…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……37.0/43.2……30.7/45.5……..n/a n/a
Public/NYSE Spec.-…17.3…………14.6…….….
Bullish%- ………45SELL………54………….…88 -2/04bear.....19bull
*Insider corporate sellers.14:1……22:1………..97………….4
Mutual Fund InflowsL(.4B)…….. (1.2B)
ETF InflowsL………..5.1B………..(2.5B)
Money Market Inflows: 19.3B…..(3.8B)

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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THE OPEC (OPAQUE IN FRENCH) "PUT":

QUANTUM SHIFT:

If anyone doubts that hedge funds/institutions rule the equities markets, versus long term mutual funds and value investors, today's round trip of nearly 400 Dow points should negate any Fundamental "fair"value model. The best, biggest and brightest of the 8,000 or so hedge funds that had their worst fund ever in July, are shaking markets intraday at rare 2% swings more and more commonly. Profit-taking from the several directional momentum plays of summer - gold, silver, energy, coal, etc. reared its ugly head as vacationers returned to the fray.
Among the sentiment indicators followed here, the Insider Trading, at 22:1, was the largest since the June swoon, and the McClellan Oscillator last week broke up through the +50 level to return to 40 by week end, possibly foretelling a short term overbought market.
Money flowed out of mutual funds, ETFs and Money Market funds, possibly to buy things (school, etc.), domestically and globally. The AAII Bulls midweek did show fear in reversing their complacency -see below:
MktSentiment. 8/29/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11543……….11628………..14093............7286
Nasdaq………. 2367…………2414…………2810.............1114
S&P500…….. 1282…………1292………….1561………..776
CBOE Eq. put/call …71…………….70……………..92-1/08….....46-1/03

VIX ………. 20.6………….18.8…….…….44… 9/02 bull..10.0-7/05 bear

McClellan Osc……….40…………17……………91-5/04 bear...(-81)-5/04bull
McClelSum……….…-275………-405…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…39.3…………40.7……….…63 (12/04bear)......35-6/06bull
Bear:………… 39.3…………38.4…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……30.7/45.5……38.1/37.3……..n/a n/a
IBD: Short Interest- na…………….na…………15.0………. 4.0
Public/NYSE Spec.-…14.6………..15.6…….….
Bullish%- ………54………….…50………….…88 -2/04br.....19bu
*Insider corporate sellers.22:1…….18:1………..97………….4
Mutual Fund Inflows: (1.2B)……..(.5B)
ETF InflowsL..(2.5B)…………..(.7B)
Money Market Inflows: (3.8B)……2B

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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QUANTUM SHIFT:

BEAR POLAR DISORDER IN OIL:

I'm not sure if drilling is the answer - it seems that refining has been the big problem, but with Conventional Wisdom saying oil should go down and Composite Operator Goldman Sachs reiterating a $150/bbl price, I'd bet on the latter!
In these dog days of lower Volume and benign neglect, regression to the mean rules, with only a few notable exceptions: the VIX, at 18.8 is in the lower zone where previous bottoms called the exact tops in Oct. '07 (9th and 31st), Dec.21, Feb.26 and May 15 -almost to the day. Although a coincident indicator, the area that it is in is the operable statistic.
Both surveys that I follow - AAII and Inv.Intell. have righted themselves to the Bullish "ON" the market (not FOR); insider trading has risen to 18:1 sales to buys.
Seasonally, it is a coin flip whether the Labor Day week, normally a positive (first few days + holiday), will be held back by the Democratic convention news.
Here are the numbers:

MktSentiment. 8/22/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11628……….11659………..14093............7286
Nasdaq………. 2414………….2452…………2810.............1114
S&P500…….. 1292………….1298………….1561………..776
CBOE Eq. put/call …70…………….70……………..92-1/08….....46-1/03

VIX ………. 18.8………….19.6…….…….44… 9/02 bu..10.0-7/05 br

McClellan Osc……….17………….35……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-405………-409…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…40.7…………31.8……….…63 (12/04br)......35-6/06bu
Bear:………… 38.4…………45.5…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……38.1/37.3……42.9/39.0……..n/a n/a
IBD: Short Interest- na…………….14…………15.0………. 4.0
Public/NYSE Spec.-…15.6………..15.9…….….21.9bl…………..1.0br
Bullish%- …………50…………50…….…88 -2/04br.....19bu
*Insider corporate sellers.18:1…….16:1………..97………….4
Mutual Fund Inflows: (.5B)……..(.3B)
ETF InflowsL(.7B)……………… 4.2B
Money Market Inflows: 2B………10B

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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BEAR POLAR DISORDER IN OIL:

"POOR STANDARDS-500":

Thanks to S&P, et.al., critical mis-rating of debt securities, the gloom still hangs over the global Financial sector, waiting to see if it's going to bend or break, as we head into the dangerous season, where the foreign tourists go home with their remaining dollars and our gov't wraps up its fiscal year. Still, the Sentiment Indicators remain quietly regressing to the mean after the extreme bearishness, and Tom McClellan sees the M2 offering liquidity to drive the market further up.
The Inv.Intell. survey, even more inverted to the bear side, agrees, as do the Specialists' shorting and short interest ratio, which dropped on both the NYSE and Nasdaq this week.
CEO legal Insider Selling did double last week, however (probably sending their kids to college).

Here are this week's numbers:

MktSentiment. 8/15/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11659……….11734………..14093............7286
Nasdaq………. 2452…………2414…………2810.............1114
S&P500…….. 1298…………1296………….1561………..776
CBOE Eq. put/call …70…………….67……………..92-1/08….....46-1/03

VIX ………. 19.6…………..20.6…….…….44… 9/02 bu..10.0-7/05 br

McClellan Osc……….35………….44……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-409……….-587…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…31.8………….34……….…63 (12/04br)......35-6/06bu
Bear:………… 45.5..……….43.6…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……42.9/39.0……35.6/42.4……..n/a n/a
IBD: Short Interest- 14…………..13.8…………15.0………. 4.0
Public/NYSE Spec.-…15.9……….17.6…….….21.9bl…………..1.0br
Bullish%- …………50…………47…….…88 -2/04br.....19bu
*Insider corporate sellers.16:1……8:1………..97………….4
Mutual Fund Inflows: (.3B)
ETF Inflows: 4.2B
Money Market Inflows: 10B

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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"POOR STANDARDS-500":

RALLY FORTH:

Although Sentiment is most useful at turning points, the intensity
of the Indicators can often predict the extent of the subsequent move.
After the market reversal these Indicators tend to subside back to
the mean, which is the case this week.
A few extremes include money market funds which did reverse,
with 32B going into them, setting an all-time record of $3.47T -
great fuel for investments, considering
the low rates (negative after Inflation), and the fact that they are not
even insured by FIDC nor SIPC.
Also Bullish this week, Inv.Intell. surveys are still inverted, a rara avis.
The McClellan Oscillator is bumping up against +50 again, at 44 -so we
could see a brief overbought correction this Option Expiry week.
Here are the numbers:

MktSentiment. 8/8/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11734……….11326………..14093............7286
Nasdaq………. 2414………….2310…………2810.............1114
S&P500…….. 1296…………1260………….1561………..776
CBOE Eq. put/call …67……………75……………..92-1/08….....46-1/03

VIX ………. 20.6………….22.5…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….44………….40……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-587………-767…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…34…………..30……….…63 (12/04br)......35-6/06bu
Bear:………… 43.6……….50…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……35.6/42.4…..40/41.2……..n/a n/a
IBD: Short Interest- 13.8………..13.6…………15.0………. 4.0
Public/NYSE Spec.-…17.6……….20.5…….….21.9bl…………..1.0br
Bullish%- …………47…………44…….…88 -2/04br.....19bu
*Insider corporate sellers.8:1…….11:1………..97………….4
Mutual Fund Inflows: (1.1B)
ETF Inflows: 5.8B
Money Market Inflows: 32B

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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RALLY FORTH:

WHOLE LOTTA SHAKIN' GOIN' ON:

4 of the last 7 days have seen 170 pt. swings on the DJIA (daily closes), yet the Sentiment Indicators moved almost imperceptibly, just as the indices did from week's close to close. Some remain in oversold states, however, and the Money Market was the only noticable extreme - to a $9B Outflow for the first time in weeks.
From a Bollinger Band narrow quietude, this could be an harbinger of more volatility and a big move, one way or the other. As the credit situations continue towards implosion, the fickle, oversold market could just mount a summer rally, as this column predicted 2 days before the bottom -on July 14th.
For anyone who wants to get a handle on the total credit situation, I would recommend reading The Trillion Dollar Meltdown by Charles Morris. Normally I take notes on good books, such as The Demon Of Our Own Design, by Richard Bookstaber, and then synopsize these for the upcoming TSAA Review's book report (on tsaasf.org). The Morris book was so full of information I returned it to the library and went out and bought it - note taking would be impossible.
Also, to my e-mail alert subscribers I am attaching charts of Justin Mamis's Sentiment cycle as well as a chart on Consumer stress - the lowest since 1980!
Here are the Sentiment Numbers:
MktSentiment. 8/1/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11326……….11370………..14093............7286
Nasdaq………. 2310…………2310…………2810.............1114
S&P500…….. 1260………….1257………….1561………..776
CBOE Eq. put/call …75……………72……………..92-1/08….....46-1/03

VIX ………. 22.5…………22.9…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….40…………37……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-767………..-967…………..1568-6/03.......-1187
Newsletter Surveys:
Inv.Intel -Bull:…..…30………….29.2……….…63 (12/04br)......35-6/06bu
Bear:………… 50…………49.4…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……40/41.2……..35.8/44……..n/a n/a
IBD: Short Interest- 13.6……….13.5…………15.0………. 4.0
Public/NYSE Spec.-…20.5………21.9nh…….….21.9bl…………..1.0br
Bullish%- …………44…………42…….…88 -2/04br.....19bu
*Insider corporate sellers.11:1……20:1………..97………….4
Mutual Fund Inflows: (1.3B)
ETF Inflows: 4B
Money Market Inflows: (8.8B)

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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WHOLE LOTTA SHAKIN' GOIN' ON:

ELLIOTT "WAIVE":

It is not uncommon for the first impulse wave of a new bull move to retrace sharply as much as 90% of Wave I. However, if it breaks the recent low, which is also near the high of 1998, all bets are off.
Nonetheless, this Bear Rally before more downside hasn't exhausted itself, in percentage points or in time, according to the dozen or so similar rallies over decades of Bear markets. Many of the indicators have backed off very oversold areas, leading to end-of-month profittaking. The McClellan Oscillator shot up through the 50 level to near 70 (overbought) before settling down for the week at +37; and its concomitant Summation broke up into negative triple-digit territory from over -1,000; public to specialist shorting and NYSE short interest hit new highs. Both ETFs and traditional mutual funds saw Billions in redemptions; newsletter surveys improved, but still remain inverted (bullish FOR the market).
This week I have deleted the indicator of most legal insider sales/buys by sector, but have discerned that the overall rate of this selling in the 10 sectors is quite revealing: looking at the tops and bottoms over the past 2 years (more sampling would be preferable), 6 of the 7 bottoms saw overall ratios at between 4 and 8 to 1 (with one at 12:1) - as for the tops, 8 of 9 were between 18 and 43 to 1, with one outlier at 5:1, although that was a declining top. This unusual statistic bears watching.
Here are the numbers:

MktSentiment. 7/25/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11370……….11496………..14093............7286
Nasdaq………. 2310…………2282…………2810.............1114
S&P500…….. 1257…………1260………….1561………..776
CBOE Eq. put/call …72……………79……………..92-1/08….....46-1/03

VIX ………. 22.9………….24.0…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….37…………15……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-967………-1187…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…29.2………..27.8……….…12/04br......35-6/06bu
Bear:………… 49.4……….48.9…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……35.8/44…….25.0/58.1……..n/a n/a
IBD: Short Interest- 13.5………..13.4…………15.0………. 4.0
Public/NYSE Spec.-…21.9nh……18.45…….….21.9bl…………..1.0br
Bullish%- …………42………..34buy…….…88 -2/04br.....19bu
*Insider corporate sellers.20:1…….8:1………..97………….4

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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ELLIOTT "WAIVE":

SENTIMENT RULES ! TW3: STOCKS,OIL,$

The secret to using Sentiment or Contrary Opinion to track the market is to allow that the public is usually right all the way up or down to the extremes. In the case of TW3 - That Was The Week That Was - the perfect storm of various indicators, both sentiment and breadth, was conclusive in its change of direction call. How far it extends depends, of course, on the balance of supply vs. demand - one way is to watch the IBD (Investor's Business Daily) signal of a followup day, 4 or so days later to confirm a material rally. And, of course, the amount of Volume on both up and down days.
Last week's indicators backed off for the most part from the sometime record extremes. The Bullish per cent went on a Buy signal of a 3 Pt.& Figure boxes (6%) rally. Although naked shorts is the topic du jour, total record shorting has to be a consideration, even though it is mostly used by institutions for hedging. 150 of the most heavily shorted stocks in the S&P1500 rose 15% while the least shorted rose only 2%.
A large part of potential supply includes the $3.5T that has gone into Money Market Funds, which not only yield 1/2 of the Inflation rate, they are not even insured by FDIC. And the New Low/ New High ratio last week was cathartic at 46 vs 1361.

Here are last week's stats:

MktSentiment. 7/18/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11496……….11100………..14093............7286
Nasdaq………. 2282…………2239…………2810.............1114
S&P500…….. 1260…………1239………….1561………..776
CBOE Eq. put/call …79……………85……………..92-1/08….....46-1/03

VIX ………. 24.0………….27.5…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….15………….-44……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-1187……..-1060…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…27.8……….….27.6……….…12/04br......35-6/06bu
Bear:………… 48.9……..…..47.3…..………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……25.0/58.1……...22.2/55.2……..n/a n/a
IBD: Short Interest- 13.4………….14.1…………15.0………. 4.0
Public/NYSE Spec.-…18.45……….18.4…….….21bl…………..1.0br
Bullish%- ………….34buy……..27…….…88 -2/04br.....19bu
*Insider corporate sellers.8:1………4:1………..97…………..4
Sectors: Most Buyers: Finance, Tech
Most Sellers: Healthcare, Tech

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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SENTIMENT RULES ! TW3: STOCKS,OIL,$

THE BEAR AND THE BLACK SWAN:

It is times like these that make all the Sentiment work worth it. As much as I prefer to gather and record the data, leaving predictions to fools and deceivers, if we do not get a material rally out of these extreme oversold readings within days, I'm going to hang it up and go fishing. I do recommend using these indicators first as a cautionary tools, then as a speculative one until proven correct.
Here are some examples: the CBOE put/call is at 85 (still off the 95 multiyear high); the VIX at 27.5 is not quite breaking through the 30 level we saw in 4 previous rallies the past year; NYSE new lows are 40 to 1 (Nasdaq 20:1); the McClellan Oscillator is off its -50 buy signal of the past 3 weeks, but the Summation broke -1,000, a new low.
Not only are the AAII and Inv.Intell surveys inverted, with more Bears than Bulls, but extremely so - more than 30 and 20%, respectively. Legal insider selling is at a new low of 4:1 (with kids going away to college next month??); Bullish per cent could also be lower - 27 is a bit above the 19 low.
With $38B going into Money Market Funds last week, this could fuel a rally, as well as the foreign money that has been huge in redemptions - oil-exporting countries make $2.5T a year in revenues. As T Boone says, we're funding both sides of the War!
Finally, record short interest on the NYSE and IBD's ratio, as well as a spike in SDS volume last week (the S&P 500 double short ETF).
Here are the rest of the numbers:
MktSentiment. 7/11/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11100……….11288………..14093............7286
Nasdaq………. 2239…………2245…………2810.............1114
S&P500…….. 1239…………1262………….1561………..776
CBOE Eq. put/call …85……………77……………..92-1/08….....46-1/03

VIX ………. 27.5…………24.78…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….-44…………-75……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-1060……….-800…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…27.6………..31.9……….…12/04br......35-6/06bu
Bear:………… 47.3……….44.7………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……22.2/55.2……23.9/52.1……..n/a n/a
IBD: Short Interest- 14.1…………13.46…………15.0………. 4.0
Public/NYSE Spec.-…18.4……….17…….….21bl…………..1.0br
Bullish%- ………….27………28…….…88 -2/04br.....19bu
*Insider corporate sellers.4:1…….7:1………..97…………..5
Sectors: Most Buyers: Industrials (1/2 the total)
Most Sellers: Energy

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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THE BEAR AND THE BLACK SWAN:

SELL IN MAY, SWOON IN JUNE...:

In the classic Stock Traders' Almanac the Hirsches posit that the the last day of the month and the first 4 are the best days to trade the market, with the 1st day alone besting the rest of the month combined! In my ongoing study of 3+ years, that still holds true, but the 9 through 11 days are outperforming the early 5 days.
Midway through today, the fourth trading day of July, the S&P500 is down 25 pts., after today's huge reversal, but the 1st day was up 4 pts., about its average.
Sentiment indicators are way oversold across the board, after the cascading May through today period:
Extremes include both the McClellan Oscillator at -75 and its cumulative Summation Index at a rare -800; both newsletter surveys I follow, the AAII and Invest.Intell. ,are inverted with bears outnumbering bulls, also a rarity.
Not quite as extended are the VIX at near 25 and the Bullish %, which at 28 needs to go to 16 to match previous bottoms. NYSE weekly NLs/NHs were 10:1, and the Nasdaq was 1:20!
Meanwhile, insider selling and shorting are off their extremes.
Here are the numbers:
MktSentiment. 7/4/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11288……….11346………..14093............7286
Nasdaq………. 2245…………2315…………2810.............1114
S&P500…….. 1262…………1278…………1561………..776
CBOE Eq. put/call …77……………73……………..92-1/08….....46-1/03

VIX ………. 24.78………..23.4…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc……….-75…………..-70……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-800…………-521…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…31.9…………33.7……….…12/04br......35-6/06bu
Bear:………… 44.7………..39.3………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……23.9/52.1……31.3/52.3……..n/a n/a
IBD: Short Interest- 13.46……….13.7…………15.0………. 4.0
Public/NYSE Spec.-…17…………17.4…….….21bl…………..1.0br
Bullish%- ………….28………..33…….…88 -2/04br.....19bu
*Insider corporate sellers.7:1……8:1………..97…………..5
Sectors: Most Buyers: Finance Most Sellers: Tech

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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SELL IN MAY, SWOON IN JUNE...:

GIVE NO QUARTER:

Now that the funny money of end-of-quarter window-dressing is over, a new quarter is upon us. Although an oversold rally is due the market, especially from the last day of a month to the 4th of the next (including a usually-positive Holiday) we could see a rally off the many Sentiment readings predictions:
The ratio-adjusted McClellan Oscillator is near its May '04 lows at -61; and the Summation is getting there at -521. The VIX in the mid-20s could get a little higher and the Bullish per cent (at 33) could go lower before we get the major bottom in the market.
Both the AAII and Inv.Intell. bull/bear ratio are bullishly inverted. Short interest and Public vs. Specialist shorting is high, although legal corporate selling has dropped, with Finance doing the most buying, Energy the selling. Energy has seen much selling since February; Finance has seen much buying even before last November.
Louise Yamada, reporting in Barron's, looks for much more downside in Financials, however. She was certainly prescient in her Gold call awhile back.
Here are the statistics:

MktSentiment. 6/27/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11346……….11842………..14093............7286
Nasdaq………. 2315…………2406…………2810.............1114
S&P500…….. 1278…………1317…………1561………..776
CBOE Eq. put/call …73……………82……………..92-1/08….....46-1/03

VIX ………. 23.4…………22.8…….…….44.. 9/02 bu..10.0-7/05 br

McClellan Osc………..-70………..-61……………91-5/04 br...(-81)-5/04bu
McClelSum……….…-521…………..-194…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…33.7…………36.3……….…12/04br......35-6/06bu
Bear:………… 39.3…………37.4………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……31.3/52.3…….33.0/45.7……..n/a n/a
IBD: Short Interest- 13.7………..15.0nh…………15.0………. 4.0
Public/NYSE Spec.-…17.4……….13.7…….….21bl…………..1.0br
Bullish%- ………….33……….40…….…88 -2/04br.....19bu
*Insider corporate sellers.8:1…….14:1………..97…………..5
Sectors: Most Buyers: Finance Most Sellers: Energy

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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GIVE NO QUARTER:

FAUX RALLY OR FOR REAL?:

Sentiment and breadth indicators are entering the extreme area of oversold, unless a Black Swan of credit derivatives (the number "notional Quadrillions" is entering the lexicon) sabotage a needed rally.
Technician Walter Deemer reports that both the Leuthold and Lowry market indicators are projecting a bottom, $500B have gone into money market funds in the 1st quarter of 2008 ($94B went in just last week, and $22B into ETFs); and the 4-year Kinchen, or Presidential cycle also calls for a bottom. Indices are also nearing their 2008 (Jan, Mar. lows).
Most egregious is the CBOE put/call ratio now at 82, higher than last week's 79; Bullish per cent is entering its low zone at 40 (% of stocks on buy signals), although this could get down into the teens.
Although the current inversion of the AAII bull/bear survey is not uncommon, for the Investors Intelligence survey to do so is very rare.
Here are the levels:

MktSentiment. 6/20/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 11842………..12307………..14093............7286
Nasdaq………. 2406…………2454…………2810.............1114
S&P500…….. 1317…………1360…………1561………..776
CBOE Eq. put/call …82……………79……………..92-1/08…..........46-1/03

VIX ………. 22.8………….21.2…….…….44.. 9/02 bu........10.0-7/05 br

McClellan Osc………..-61………..-32……………91-5/04 br......(-81)-5/04bu
McClelSum………-194……………-15…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…36.3………….43……….…12/04br......35-6/06bu
Bear:………… 37.4…………32.6………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……33.0/45.7…….31.3/53.6……..n/a n/a
IBD: Short Interest- 15.0nh…………13.8…………15.0………. 4.0
Public/NYSE Spec.-…13.7…………15.4…….….21bl…………..1.0br
Bullish%- ………….40…………44…….…88 -2/04br.....19bu
*Insider corporate sellers.14:1……..10:1………..97…………..5
Sectors: Most Buyers: Energy Most Sellers: Consumer non-durables

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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FAUX RALLY OR FOR REAL?:

WILD AND CRAZY WEEK:

There were lots of sentiment and breadth indicators showing extremes last week, so I'll point them out -top down:
Although the DJIA rose 100 points from the previous week, the Nasdaq sank 20; the CBOE put/call ratio shot up even higher to 79 (very bullish short term); the VIX did a mid-20 spike, although 4 previous larger rallies in '08 saw the spike above 30.
In the breadth area, 3 of the last 4 weeks saw 1300 to 1500 net decliners, and the new high/new low figures on both the NYSE and Nas were ugly :106/330 and 78/406, respectively. The McClellan Oscillator sank to -75 on its journey from -31 to -32, prompting the midweek rally; the Summation went negative for the first time in awhile (April 18).
The AAII survey inverted to a large 31/53 bear position, and the Nas to NY Volume ratio (speculation) rose to 9 points off its multi-year high of 177. The volume on the SDS etf (short the S&P) almost doubled its 4-week average, while flows into Money Markets saw a huge increase to $94B, 1/2 again as much as the old high in November '07, when the markets began their cascade downward. Finally, the Public to Specialist shorting jumped from 11 to 15 on the IBD scale.
Here are the full numbers:
MktSentiment. 6/13/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 12307………..12209………..14093............7286
Nasdaq………. 2454………….2474…………2810.............1114
S&P500…….. 1360…………1360…………1561………..776
CBOE Eq. put/call …79…………..74……………..92-1/08…..........46-1/03

VIX ………. 21.2………….23.5…….…….44.. 9/02 bu........10.0-7/05 br

McClellan Osc………..-32…………-31……………91-5/04 br......(-81)-5/04bu
McClelSum………-15……………..254…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…43……………44.8……….…12/04br......35-6/06bu
Bear:………… 32.6…………31.1………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……31.3/53.6…….43.5/38.0……..n/a n/a
IBD: Short Interest- 13.8…………14.38nh…………14.3………. 4.0
Public/NYSE Spec.-…15.4…………11.5…….….21bl…………..1.0br
Bullish%- ………….44………….50…….…88 -2/04br.....19bu
*Insider corporate sellers.10:1……..27:1………..97…………..5
Sectors: Most Buyers:Finance Most Sellers: Energy
Both leaders 2X nearest #2 sector

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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WILD AND CRAZY WEEK:

IN THE MARKET FOR MONEY:

$18B went into Money Market Funds last week, adding to the $45B in May. According to Ned Davis, nearly 1/4 of the $13T stock market is in MMFs/Cash, the most since 2003, and more than the 3rd highest in 20 years. Added to record short interest (much of it by institutions) this could bode for a huge rally down the road.
After last week's Selling Climax Friday, the CBOE put/call ratio rose to 74, a short term buy signal borne out in today's rally; also, the VIX spiked to a 2 months high at 23.5, and the McClellan Oscillator is at -31, slightly oversold.
On the flip side, Insider Selling by CEOs, etc. also rose to a 2 month high of 27:1, with Energy more than 1/3 of total sector sales. Bullish per cent is at 50, still on a sell signal.
Here are the numbers:

MktSentiment. 6/6/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 12209……….12638………..14093............7286
Nasdaq………. 2474………….2522…………2810.............1114
S&P500…….. 1360…………1400…………1561………..776
CBOE Eq. put/call …74…………..63……………..92-1/08…..........46-1/03

VIX ………. 23.5…………17.8…….…….44.. 9/02 bu........10.0-7/05 br

McClellan Osc………..-31………-18……………91-5/04 br......(-81)-5/04bu
McClelSum………254…………..340…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…44.8…………37.9……….…12/04br......35-6/06bu
Bear:………… 31.1…………32.2………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……43.5/38.0……31.4/45.8……..n/a n/a
IBD: Short Interest- 14.38nh…….14.3nh…………14.3………. 4.0
Public/NYSE Spec.-…11.5……….10.4…….21bl…………..1.0br
Bullish%- ………….50…………..55…….…88 -2/04br.....19bu
*Insider corporate sellers.27:1……..9:1………..97…………..5
Sectors: Most BuyersFinance Most Sellers: Energy (1/3)

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

IN THE MARKET FOR MONEY:

FANTASTIC VOYAGE:

Back from vacation, after impressing my family by placing first in guessing the midpoint on the flight to Maui (off by 23 seconds). Also the first time I had a cab to the airport overheat and not be able to continue.
Whle away, the market didn't overheat - more like a Linda Raschke-type 3-Up, 3-Down minicycle. After a flip-flop on the Recession % indicator, it will hit the waste bin, along with the Market Vane non-event number; circling the drain is the Birinyi bull/bear stat, as well.
Most indicators are lying in the midrange area, while the Bull/Bear surveys either narrowed (the Inv.Intell.) or inverted (AAII).
Short interest on IBD hit a new high, although as Barrons stated, much of that is used by nearly $2T in hedgefund long/short strategies.
Here are the actual numbers:

MktSentiment. 5/30/2008 Prev. Week.....5Yr.HI......LOW

DJIA ………. 12638……….12479………..14093............7286
Nasdaq………. 2522…………2444…………2810.............1114
S&P500…….. 1400…………1375…………1561………..776
CBOE Eq. put/call …63……………67……………..92-1/08…..........46-1/03

VIX ………. 17.8………..19.5…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 30………….30…………….76(bullish)….28(bearish)
McClellan Osc………-18………..-35……………91-5/04 br......(-81)-5/04bu
McClelSum………340…………..390…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…37.9…………47.3……….…12/04br......35-6/06bu
Bear:………… 32.2…………30.8………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……31.4/45.8……46.3/34.3……..n/a n/a
MarketVane Bulls…51……………54…………. 74br..............24bu
IBD: Short Interest- 14.3nh………13.8nh…………14.3………. 4.0
Public/NYSE Spec.-…10.4…………10.4…….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………23.8/42.8……31.8/40.9
Bullish%- …………55………….55sell…….…88 -2/04br.....19bu
*Insider corporate sellers.9:1……..17:1 ………..97…………..5
Sectors: Most Buyers: Consumer Services
Most Sellers: Technology

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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FANTASTIC VOYAGE:

ALOHA:

This issue comes a day early (and next week's a day late) due to another vacation. Last week's slaughter of stocks brought mixed reactions to the indicators. Some, such as the McClellan Oscillator at -35, plus the holiday and 1st-of-the-month kindness, would bode for a relief rally short term. Others, such as the VIX, which reached October's low spike (the all time high before the fall), has climbed back just below 20. Short interest on the NYSE hit a new record high of $60B (13.8% on the IBD chart) with Finance and Energy the most heavily shorted ETFs.
Corporate insiders were buyers of Finance, however, and Energy and Tech were the sellers' targets. Bullish per cent went to a Sell signal after last week's runoff, but even with a 6% filter it can get whipsawed.
CBOE equity put/call rose some, and OTC puts were bought before the holiday weekend.
Here are the numbers:

MktSentiment. 5/23/2008 Previous Week..5Yr.HI...... LOW

DJIA ………. 12479………..12986………..14093............7286
Nasdaq………. 2444…………2528…………2810.............1114
S&P500…….. 1375…………1425…………1561………..776
CBOE Eq. put/call …67…………….61……………..92-1/08…..........46-1/03

VIX ………. 19.5…………16.5…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 30…………..35…………..76(bullish)….28(bearish)
McClellan Osc………-35…………36……………91-5/04 br......(-81)-5/04bu
McClelSum………390……………426…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…47.3…………46……….…12/04br......35-6/06bu
Bear:………… 30.8…………29.9………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……46.3/34.3……45.2/29.7……..n/a n/a
MarketVane Bulls…54……………53…………. 74br..............24bu
IBD: Short Interest- 13.8nh……….13.4nh…………13.8………. 4.0
Public/NYSE Spec.-…10.4…………11.3…….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………31.8/40.9……36/45
Bullish%- …………55sell………62…….…88 -2/04br.....19bu
*Insider corporate sellers.17:1 …..20:1………..97…………..5
Sectors: Most Buyers: Finance (1/3 of all sectors)
Most Sellers: Energy, Technology

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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ALOHA:

THE WISDOM OF CROWDS:

The essence of Contrary Opinion is to go against the Conventional Wisdom, or majority - at least at the extremes, because of people's herdlike mentality and reliance on "experts" to influence them. But James Suroweicki, in his book the Wisdom of Crowds maintains that the experts also are victims of overconfidence in their opinions and are influenced by their peers. Studies show that congresses, juries, et.al. make decisions based on the loudest and strongest voice, whereas TV programs such as Millionaire rely on thousands of disparate opinions (Lifeline) to get more accurate answers. Which brings us to Intrade.com , the Irish betting company where, like open outcry markets, traders put money on their opinions. A few weeks ago they set high records on the odds of a Recession in '08, which was Bullish for the market in contrary fashion. Now, however, it is setting new lows betting that we may avoid one - this may indicate the market could trend lower before it rallies again to new highs.
Other extremes on the south side included a complacent VIX reading of 16.5, a recent low; the McClellan Oscillator and Summation Index are "nearing" usual high areas, as is the Bullish per cent index. Nasdaq to NYSE Volume was almost to a record high at 179, and money market cash flowed in at $23B versus a record outflow the week before at minus $78B.
Insider selling remains relatively high and short interest (IBD's ratio) is at a record high of 13.4.
On the plus side breadth is strong (although Volume remains weak), and sideline money is the 3rd greatest since the '87 and '03 rallies.

MktSentiment. 5/16/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12986………..12745………..14093............7286
Nasdaq………. 2528………….2445…………2810.............1114
S&P500…….. 1425………….1388…………1561………..776
CBOE Eq. put/call …61…………….64……………..92-1/08…..........46-1/03

VIX ………. 16.5…………..19.4…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 35……………28…………..76(bullish)….28(bearish)
McClellan Osc………36…………..22……………91-5/04 br......(-81)-5/04bu
McClelSum………426…………….304…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…46……………44.4……….…12/04br......35-6/06bu
Bear:………… 29.9…………32.3………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……45.2/29.7…….52.8/24.7……..n/a n/a
MarketVane Bulls…53……………55…………. 74br..............24bu
IBD: Short Interest- 13.4nh………13nh…………13.4………. 4.0
Public/NYSE Spec.-…11.3…………11.4…….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………36/45…… 36/45
Bullish%- …………62…………56…….…88 -2/04br.....19bu
*Insider corporate sellers.20:1…..20:1………..97…………..5
Sectors: Most Buyers: Finance
Most Sellers: Technology

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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THE WISDOM OF CROWDS:

"STABLE" ECONOMY:

When George Bush says we have a stable economy he must mean it belongs in the barn. Last week the market seemed more correlated (inversely) to record oil prices than fundamentals, yet most of the indicators went on vacation with me. The put/call ratio, VIX, market letters, even the short interest, stayed the same.
Mutual funds outflows of $6M along with ETF inflows of the same amount was a wash - yet moneymarket outflows were a record $78B. And IBD's short interest ratio hit another record of 13.0.
Here are the numbers:

MktSentiment. 5/9/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12745………..13058………..14093............7286
Nasdaq………. 2445…………..2477…………2810.............1114
S&P500…….. 1388………….1413…………1561………..776
CBOE Eq. put/call …64…………….66……………..92-1/08…..........46-1/03

VIX ………. 19.4………….18.2…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 28……………30…………..76(bullish)….28(bearish)
McClellan Osc………22…………..37……………91-5/04 br......(-81)-5/04bu
McClelSum………304…………….209…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…44.4………….40.9……….…12/04br......35-6/06bu
Bear:………… 32.3…………31.8………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……52.8/24.7…….53.3/26.3……..n/a n/a
MarketVane Bulls…55……………52…………. 74br..............24bu
IBD: Short Interest- 13nh……….12.58nh…………13.0………. 4.0
Public/NYSE Spec.-…12.1……….12.1……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………36/45…….38/28
Bullish%- …………56……….54……….…88 -2/04br.....19bu
*Insider corporate sellers.20:1…..25:1………..97…………..5
Sectors: Most Buyers: Finance, Technology
Most Sellers: Technology

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

"STABLE" ECONOMY:

BASKET CASE-GOLD:

A Catch-22 side effect of Gold and other commodity ETF baskets recently surfaced - when GLD, which is backed by 18M oz. , experienced a selloff of shares, they had to sell 1/8 of the total spot gold - almost 2M oz.- which brought down the price of gold, causing others to sell shares, etc. etc. We can expect such volatility in others, such as grains, oil, other metals.
Meanwhile, this extended Bear rally (?) is getting long in the tooth - 2 months of a-b-c up to resistance ( on less than convincing Volume), and John Roque of Natexis' has a target of 1415 SPX which it just hit and backed off.
With the breadth indicators - McClellan Oscillator and Bullish per cent - occupying middle ground, many Sentiment factors are also mid-range. One extreme is the Nasdaq to NYSE Volume (speculation) which is at new highs -182! Also at a record is Money Market outflows - must have been that last rate cut- at -$61B.
With the help of the uptick rule loss, short interest is at a record 12.58 on the IBD scale. Finally, legal Insider selling is back up to 25:1, with Consumer Services topping both the Buy and Sell sectors.
Here are the numbers:

MktSentiment. 5/2/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 13058………..12891………..14093............7286
Nasdaq………. 2477………….2422…………2810.............1114
S&P500…….. 1413………….1397…………1561………..776
CBOE Eq. put/call …66……………..67……………..92-1/08…..........46-1/03

VIX ………. 18.2…………19.6…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 30……………45…………..76(bullish)….31(bearish)
McClellan Osc………37…………..33……………91-5/04 br......(-81)-5/04bu
McClelSum………209…………….55…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…40.9…………39.1……….…12/04br......35-6/06bu
Bear:………… 31.8…………35.6………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……53.3/26.3……46.7/27.5……..n/a n/a
MarketVane Bulls…52……………51…………. 74br..............24bu
IBD: Short Interest- 12.58nh…….11.57nh……………12.58………. 4.0
Public/NYSE Spec.-…12.1……….12.1……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………38/28…….38/28
Bullish%- …………54……….52buy……….…88 -2/04br.....19bu
*Insider corporate sellers.25:1……17:1………..97…………..5
Sectors: Most Buyers: Consumer Svc
Most Sellers: Consumer Svc (1/3 of total)

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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BASKET CASE-GOLD:

BONUS COVERAGE:

The recent March low (second of '08s Double Bottom formation) had some absolute and relative extremes in Sentiment land. The CBOE Equity put/call ratio of 94 was prominent; the McClellan Oscillator and Summation Indices, oversold at -65 and -650, respectively, called for a rally. The SPX was 7% under its 200-day MA, Bullish per cent was on a Buy signal, and both Inv.Intell. and AAII Bull/Bear surveys were inverted, a rarity. For the full matrix of March and other market bottom levels, please e-mail: leonbrnt@aol.com. You may also request being added to the e-mail alert distribution list.
Minimum measurement of the double top could take us to the Sept. and Dec. highs on the SPX and DJIA. However, upside momentum is easing at month end, both in Volume and Sentiment's retracement to the middle.Both the surveys have regained the positive Bull dominance, CEO Insider selling abated from a high 27:1 down to 17:1, still recently high. The IBD short interest ratio went ot a new 5-year high, and Bullish percent whipsawed back to a Buy signal.
Here is the matrix:
MktSentiment. 4/25/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12891………..12849………..14093............7286
Nasdaq………. 2422………….2402…………2810.............1114
S&P500…….. 1397………….1390…………1561………..776
CBOE Eq. put/call …67…………….74……………..92-1/08…..........46-1/03

VIX ………. 19.6…………20.1…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 45…………..60…………..76(bullish)….31(bearish)
McClellan Osc………33………….53……………91-5/04 br......(-81)-5/04bu
McClelSum………55…………….-65…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…39.1……….37.8……….…12/04br......35-6/06bu
Bear:………… 35.6………..38.9………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……46.7/27.5…..30.4/48.7……..n/a n/a
MarketVane Bulls…51………….46…………. 74br..............24bu
IBD: Short Interest- 11.57nh……10.95……………11.57………. 4.0
Public/NYSE Spec.-…12.1……….12.7……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………38/28…….48/28
Bullish%- …………52buy……48sell……….…88 -2/04br.....19bu
*Insider corporate sellers.17:1…..27:1………..97…………..5
Sectors: Most Buyers: Finance (1/2 total)
Most Sellers: Energy

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

BONUS COVERAGE:

GET SHORTY:

Like many longterm Sentiment and Supply/Demand indicators, Short Interest cannot be closely correlated to price action, but it is obvious that if a record amount of it exists, it will add fuel to a rise in prices, with so many tyro money managers/hedge funds tuned to the same channel and shorting the markets. A recent Barron's reported the Russell 2000 ETF (IWM) had 150% of its shares shorted; the Retail Spider (XRT) had 670%, homebuilders (XHB) 177%, and Real Estate (IYR) 133%.
Overall markets are reporting SI semi-monthly now, which is very high. Whether that was a major cause of Friday's huge up day, or option expiration, is debatable, but there was no followthrough today (Monday).
Almost all the CNBC and print pundits opine that we are at "A" bottom, and the wisdom at the weekend's excellent AAPTA/TSAA Conference was also mixed. As Editor of the TSAA Quarterly Review, I will be synopsizing and reproducing documents from that event in the upcoming newsletter shortly. The speakers as a whole gave historical, lively, and humorous talks that were both professional and actionable.
As expected, last week's Resistance-breaking rally caused Sentiment to regress from Bearish in many cases, including the McClellan Oscillator which ended at +53, recently a topping area; the IBD short interest was at a new record high; the Bullish per cent went on a SELL signal, although it is still in the lower area of the PNF chart. Completing the mixed picture is the bullish inversion of both the AAII and Inv.Intell. surveys on bullish/bearish positions, yet corporate insider selling screamed to the upside at 27:1!
Here are the numbers:
MktSentiment. 4/18/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12849……….12325………..14093............7286
Nasdaq………. 2402…………2290…………2810.............1114
S&P500…….. 1390…………1332…………1561………..776
CBOE Eq. put/call …74……………84……………..92-1/08…..........46-1/03

VIX ………. 20.1………….23.4…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 60…………..72…………..76(bullish)….31(bearish)
McClellan Osc………53………….-6……………91-5/04 br......(-81)-5/04bu
McClelSum………-65……………-162…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…37.8……….37.4……….…12/04br......35-6/06bu
Bear:………… 38.9………38.5………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……30.4/48.7…..45.8/37.3……..n/a n/a
MarketVane Bulls…46………….50…………. 74br..............24bu
IBD: Short Interest- 10.95nh…..10.5……………10.95………. 4.0
Public/NYSE Spec.-…12.2………12.9……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………48/28…….30/40
Bullish%- …………48sell…….48……….…88 -2/04br.....19bu
*Insider corporate sellers.27:1……7:1………..97…………..5
Sectors: Most Buyers: Consumer Services
Most Sellers: Energy

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

GET SHORTY:

SIDEWAYS:

When a drug deal goes bad they call it "going sideways"; when a market does it, it's not so bad. It's a good environment for selling puts or covered calls, dividend stocks, etc. The S&P 500 (SPX) is exactly where it was on Jan.17 this year. Vince Farrell said it best on CNBC - "It's a good time to Rent stocks, not Buy them" . Still, top Insider Buying is with Finance stocks, as bad as that sector seems - total is only 7:1 (see below).
Many sentiment indicators are regressing to the mean lately, although the CBOE put/call is still high at 84, and the IBD short interest is at a record high.
Barron's was kind enough to plug the local TA conference this week in their Preview section - that is , the AAPTA, TSAA one featuring Larry McMillan, Linda Raschke, Paul Desmond of Lowry's, economic advisor Donald DeLutis, et.al., occurring this Friday and Saturday - see TSAASF.org for details, or if you are distant, as many readers from Channel Islands, Argentina, Spain, Israel, etc. are, you can check the URL later for a recap.
Here are the numbers:

MktSentiment. 4/11/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12325………12609………..14093............7286
Nasdaq………. 2290…………2370…………2810.............1114
S&P500…….. 1332…………1370…………1561………..776
CBOE Eq. put/call …84…………..95……………..92-1/08…..........46-1/03

VIX ………. 23.4…………22.4…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 72……………73…………..76(bullish)….31(bearish)
McClellan Osc………-6…………..54……………91-5/04 br......(-81)-5/04bu
McClelSum………-162…………..-285…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…37.4……….36.4……….…12/04br......35-6/06bu
Bear:………… 38.5……….37.5………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……45.8/37.3……36.7/39.4……..n/a n/a
MarketVane Bulls…50………….50…………. 74br..............24bu
IBD: Short Interest- 10.5……….8.74……………10.5………. 4.0
Public/NYSE Spec.-…12.9………12.6……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………30/40…….50/25
Bullish%- …………48………..52……….…88 -2/04br.....19bu
*Insider corporate sellers.7:1……..15:1………..97…………..5
Sectors: Most Buyers: Finance (1/4)
Most Sellers: Energy

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

SIDEWAYS:

BULL ROAR:

Sentiment, liquidity - both home and abroad- shortcovering and many technicals (breadth) have turned around a Bear market, at least for now. Some Resistance does loom overhead (12,700-740 on the DJIA, 1405-30 on the SPX). Whenever bad news (such as WaMu, today) is ignored by the market, the bulls win.
Some of the Sentiment standout extremes last week include: NY Advance/Declines were positive for the first time in months, and Money Markets had outflows, also for the first time since the end of '07. The A/D pushed the McClellan Oscillator above 50, at 54, which along with the aforementioned Resistance, might slow down the upsurge.
Although the AAII Bull/Bear survey is still inverted, the Inv.Intell. and Market Vane are way complacent. Legal insider selling shot up to 15:1, albeit still low, with Healthcare leading the buyers and Energy leading the Sellers bigtime. Finally, speculative OTC Volume vs. NYSE is 163%, getting a bit toppy.
Here are the numbers:

MktSentiment. 4/04/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12609……..12216………..14093..............7286
Nasdaq………. 2370……….2261…………2810.............1114
S&P500…….. 1370……….1315…………1561………..776
CBOE Eq. put/call …95………….76……………..92-1/08…..........46-1/03

VIX ………. 22.4………..25.7…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 73………….70……………76(bullish)….31(bearish)
McClellan Osc………54………….0……………91-5/04 br......(81)-5/04bu
McClelSum………-285…………-511…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…56.5……….36.7……….…12/04br......35-6/06bu
Bear:………… 25.0……….41.1………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……36.7/39.4…..41.6/33.6……..n/a n/a
MarketVane Bulls…50………….48…………. 74br..............24bu
IBD: Short Interest- 8.74………. 9.73……………10.3………. 4.0
Public/NYSE Spec.-…12.6………15.5……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………50/25…….50/25
Bullish%- …………52……….40……….…88 -2/04br.....19bu
*Insider corporate sellers.15:1……9:1………..97…………..5
Sectors: Most Buyers: Healthcare
Most Sellers: Energy (1/3 of total)

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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BULL ROAR:

BUY/BYE:

The vast preponderance of sentiment points to Bullish FOR the market (Bearish ON the market) - Bob Brinker, one of the brighter lights in the room, says his 60-day put/call ratio says BUY; Richard Arms has a new predictor - a market Volatility MA -which is showing a 5-year high (since 2003's bottom); Barron's opines that the commodity market is 30% overblown due to speculators, investment and index funds , while commercial hedgers -the so-called smart money- is going the other way. If money comes out of commodities, and also low-paying Treasuries (now that the Fed is "guaranteeing" other debt), added to the $4T in money market funds, this market could scream to the upside at some point, especially with record short interest in both listed and OTC exchanges.
So far Volume is not showing this huge potential, and the public is racing for the Money Market Funds ($36B last week), which is also bullish. Of the other sentiment indicators, Insider Sales by CEOs, et.al., is still low, at 9:1; the U. of Michigan Confidence number was at a 16-year low of 69%; both IBD and Bullish per cent are on BUY signals; public shorting vs. specialists is high, and the Inv.Intell. survey is still inverted, although the AAII reverted back to a Bull plurality.
I have added a couple of new indicators, which I am testing - bi-weekly short interest on the exchanges, and the weekly Volume on the SDS, which is the double-strength shorting of the S&P500 (replacing the old Rydex Ursa/Nova stat which went away).

MktSentiment. 3/28/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12216………12361………..14093..............7286
Nasdaq………. 2261……….2258…………2810.............1114
S&P500…….. 1315……….1329…………1561………..776
CBOE Eq. put/call …76………….94……………..92-1/08…..........46-1/03

VIX ………. 25.7………..26.6…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 70………….76……………76(bullish)….31(bearish)
McClellan Osc………0………….-7……………91-5/04 br......(81)-5/04bu
McClelSum………-511…………-627…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…36.7………30.9………..62.9-12/04br......35-6/06bu
Bear:………… 41.1………44.7………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……41.6/33.6……25.2/54.3……..n/a n/a
MarketVane Bulls…48………….46…………. 74br..............24bu
IBD: Short Interest- 9.73……….9.35……………10.3………. 4.0
Public/NYSE Spec.-…15.5………8.74……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………50/25…….50/25
Bullish%- …………40……….32buy……….…88 -2/04br.....19bu
*Insider corporate sellers.9:1……6:1………..97…………..5
Sectors: Most Buyers: Healthcare (1/2 of total sector buys)
Most Sellers: Technology

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

BUY/BYE:

% LIKE IKE:

It has been half a century since the shortest Treasury Bill was 1/2% - one of many notable extremes from a shortened week. Contrary to my quoting the Trader's Almanac that when Easter falls in March, both parenthetical days of surrounding the weekend tend to be down. To have back to back up days totalling the most points since the '03 bottom flies in the face of that small sampling anecdote.
Cases can be made for the market bottom being in or for just a shortcovering oversold bump after the Fed's accommodation. Short term it is hard to ignore the bearish sentiment and solid upside momentum of the last few days. Although I stopped following the hourly ISEE call/put ratio, I noticed today it was screaming a near-200 Sell signal, yet the market ignored it today. New lows to new highs last week were 13:1 and 23:1 for the NYSE and Nasdaq, and the McClellan Summation Index is very low exhibiting a weak Advance/Decline period. Tom McClellan will no doubt be addressing this topic at next month's TSAA Seminar (see tsaasf.org for details).
Making a strong Bullish case are the newsletter surveys, the record CBOE put/call ratio, record short interest on the NYSE. Money markets, even with low-going-lower rates are 50% greater than the bottom of '03 -$3.4T. The Bullish per cent went from a Sell to a Buy signal in 2 weeks.
ETFs had huge inflows last week, yet domestic mutual funds are showing 10 months of outflows, more than after 1987. Here are the numbers:
MktSentiment. 3/21/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 12361………11951………..14093..............7286
Nasdaq………. 2258………..2212…………2810.............1114
S&P500…….. 1329……….1288…………1561………..776
CBOE Eq. put/call …94………….94……………..92-1/08…..........46-1/03

VIX ………. 26.6………..31.2…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 76………….74……………76(bullish)….31(bearish)
McClellan Osc………-7…………-56……………91-5/04 br......(81)-5/04bu
McClelSum………-627…………-477…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…30.9……….31………..62.9-12/04br......35-6/06bu
Bear:………… 44.7………43.3………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……25.2/54.3…..20.4/59.2……..n/a n/a
MarketVane Bulls…46………….43…………. 74br..............24bu
IBD: Short Interest- 9.35…………9.7……………10.3………. 4.0
Public/NYSE Spec.-…8.74………10……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………50/25……26/53
Bullish%- …………32buy…..27……….…88 -2/04br.....19bu
*Insider corporate sellers.6:1…..5:1………..97…………..5
Sectors: Most Buyers: Finance (1/3 of total)
Most Sellers: Finance

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

% LIKE IKE:

BENHAWK DOWN:

Helicopter Ben is firing all his ammo this week, using huge rate cuts, cash and Treasuries. "BEARron's" has never been so outright declamatory of imminent market failure (reminiscent of Paul McRae Montgomery's contrary magazine cover indicator), and the sentiment indicators are screaming for a rally. This inevitable leverage unwinding is creating the biggest redistribution of wealth since the 1930s - something that the socialists and Islamofascists never dreamed of.
Every U.S.-traded commodity is at record highs, many at double-00 levels (Oil, gold, Yen) which could be a stop, look and listen area.
This week is packed with ugliness, with LEH,GS earnings out, the rate cut, premature option expiry (Thursday), and even March Madness basketball pools. Jeff Hirsch notes in his Traders' Almanac that when Easter comes in March (also the same week as St. Patrick's Day) , both the day before AND the day after that weekend are usually down for the markets (small sampling can be useful as warnings).
Although the preponderance of historical evidence calls for a huge rally in the Fall, we could have "A" bottom in the next few days, as short interest is huge. The previous 400+ pt. day before last week was at "THE" bottom on March 13, 2003.
Money Market Funds, now at $3.4T are below the CPI Inflation rate (3.2% and going lower, vs. 4% respectively) and waiting to redeploy.
Finally, Ned Davis Research cites the average of 10 past Recessions have market peaks 7 months before it is declared, with the market nadir 6 months into it, with the Recession lasting an average of 10 months. That would put Sept./Oct. of 2008 as the low.
The Bullishly "Screaming" indicators consist of - a CBOE put/call ratio of unheard of 94; VIX at 32; McClellan Oscillator at -56; an unheard of "inverted" Inv.Intell. Bull/Bear survey ratio of 31/43; and the Bullish Per Cent is down at 27%.

MktSentiment. 3/14/2008 Last Week..... .5Yr.HI...... LOW

DJIA ………. 11951………11893………..14093..............7286
Nasdaq………. 2212………..2212…………2810.............1114
S&P500…….. 1288………..1293…………1561………..776
CBOE Eq. put/call …94………….90……………..92-1/08…..........46-1/03

VIX ………. 31.2…………27.5…….…….44.. 9/02 bu........10.0-7/05 br
Intrade.com-
Recession% 74………….73……………75(bullish)….31(bearish)
McClellan Osc………-56………..-65……………91-5/04 br......(81)-5/04bu
McClelSum………-477…………-217…………..1568-6/03.......-917

Newsletter Surveys:
Inv.Intel -Bull:…..…31…………41.9………..62.9-12/04br......35-6/06bu
Bear:………… 43.3………36.6………… 38.2-3/03.......16-6/03

AAII-Bull/Bear ……20.4/59.2…..22/51.7……..n/a n/a
MarketVane Bulls…43…………..42…………. 74br..............24bu
IBD: Short Interest- …9.7………10.1……………10.3………. 4.0
Public/NYSE Spec.-…10…………12.7……….21bl…………..1.0br
Birinyi Blogger
Bull/Bear Poll ………26/53……..38/43
Bullish%- …………27……….28sell……….…88 -2/04br.....19bu
*Insider corporate sellers.5:1……….13:1………..97…………..5
Sectors: Most Buyers: Finance
Most Sellers: Energy

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

BENHAWK DOWN: