Over the past few months I have noted in this blog that several indicators have gone to extremes, without any apparent resulting reaction; I have also noted that the normal Fall corrections - lousy September, October crashettes, etc.- have also been absent.
One possible explanation has surfaced, from a Smart Money article by the esteemed TrimTabs writer of institutional money flows-Charles Biderman of Santa Rosa: Over the past year, $600B has gone into the market, creating (in a 10:1 leverage ratio) $6T in new stock market cap since March. This source of this amount that is unaccounted for can most likely be attributed to the U.S. Government purchasing stock index futures, not as speculation, but as a support when futures indicate weakness - thereby preventing a shock to the financial system. Like supporting the Treasury market it is legal, but irregular. The question is, as with the Stimulus, is what happens when the steroid injections cease?
This week, as the markets reach new recent highs, breadth is enormous, with the NYSE new highs at 858 vs. 6 new lows!
Insider selling again increased to 58:1, and both the Bullish per cent and Nova/Ursa are at high levels - Bearish for the market.
| MktSentiment | Last Week | Prev. Week | 5 Yr HI | 5 Yr LOW |
| DJIA: | 10618 | 10428 | 14093 | 6626 |
| Nasdaq: | 2317 | 2269 | 2805 | 1114 |
| S&P 500: | 1145 | 1115 | 1561 | 683 |
| CBOE Eq. put/call: | 52 | 61 | 96-10/08 | 46-1/03 |
| VIX: | 18.1 | 21.7 | 90 | 8.8 |
| McClellan Osc: | 33 | -1 | 108 | -100 |
| McClellan Sum: | 1008 | 863 | 1568 | -1514 |
| Newsletter Surveys | ||||
InvestorsIntel.Bull: | 48.3 | 51.1 | 63 | 22.21 |
InvestorsIntel.Bear: | 16.9 | 15.6 | 54.4 | 16 |
AAII Bull: | 49.2 | 49.2 | n/a | n/a |
AAII Bear: | 23.0 | 23.0 | n/a | n/a |
| Nova/Ursa Mutual Funds: | 0.75 | 0.62 | 2.2 | 0.56 |
| Mutual Fund Flows:1 wk delay | n/a | 3B | ||
| Money Market Flows | 14B | 22B | ||
| ETF equity:Monthly Totals | Nov 738B | Oct 591B | ||
| Baltic Dry Index: | 3149 | 3005 | 11700 | 663 |
Bullish %: | 82 | 79 | 88 | 2 |
| Insider Corporate Sellers: | 58:1 | 51:1 | 108:1 | 2.4:1 |
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