For the 13th time (out of 13,in this decade) the CBOE Equity Put/Call ratio indicated the recent bottom in the stock market - small sampling in the technical world, but 100% has to be respected. As Barron's reported from Bespoke Group, in this two week rally, the largest gainers were: those most heavily shorted , the "fallen angels" which fell the furthest previously, and the ones that were rated worst by analysts! Despite this, Nasdaq short interest rose 4% last week.
Although this rally could run for awhile there are some short term toppy signs - the Nova/Ursa fund ratio jumped to .94 (up exactly 50% from the previous week); the McClellan Oscillator is at an overbought 72 with its concomitant Summation Index nearing 1,000; and the Bullish per cent of stocks on a Buy signal at 68 is near its high water mark of 74, although its multi-year high has been 88%.
A scarier number is the Thomson/Reuters 144 planned sales to buy ratio of Insiders: 41:1 after last week's 48:1. Anecdotally (more in future weeks) this has been a non-contrarian indicator over the past few years.
While the newsletter surveys are neutral, the VIX continues down to recent lows lulling traders into complacency.
Here are last week's numbers:
MktSentiment. 7/24/2009 Prev. Week.....5Yr.HI......LOW
DJIA ………. 9093………8743.………..14093............6626
Nasdaq………. 1965………1886…………2810.............1114
S&P500…….. 979…………940………….1561………..683
CBOE Eq. put/call …66…………..63……..…96-10/08….....46-1/03
VIX ………. 23.1………..24.3…….…….90…….….8.8
McClellan Osc………72…………..49…………..108……..(-100) McClelSum…………..855……….534………..…....1568-....-1514
Newsletter Surveys:
Inv.Intel -Bull:…..…36.7……….35.6………….…63 ……...22.2l
Bear:………… 35.6………35.6…………… 54.4.......16-
AAII-Bull/Bear ……37.6/42.4….28.7/47.1…….…..n/a
Nova/Ursa MF………0.94………0.56nl…………….2.2……..0.56
Baltic Dry Index ……3345………3542………….11700………663
Bullish%- …….…68…………55buy………….…88…….....2
*Insider corp sellers. 48:1………..13:1……………108:1…….2.4:1
Mutual Fund Inflows .. 1.5B…….(0.7B)…..
ETF InflowsL……… (1.3B)…..(0.4B)…….
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