I was rather dubious when, in mid-January at the TSAA monthly meeting, Martin Pring bravely forecasted an upmove for the markets short term, but by mid-summer the DJIA would be about 14% BELOW the January 1 level of 10,428 - or around the 9,000 level.
Other technicians have also supported this view, such as Arch Crawford, Tom McClellan, Bill Gibson, John Roque, Volume Reversal's Mark Liebovit, and Peter Eliades -all with varying but similar scenarios.
Meanwhile all the Fundamental Analysts and Economists are calling for a minimum of 10% higher by the end of 2010 - which could very well happen.
Meanwhile, I remain defensive, relying on my DITM strategy (for more please see www.brentleonard.com), which has consistently returned the 100-year market average of around 10% with a safety net.
My view is based on the nesting of cycles, from the 18-year double cycle, the 10-year zero year, the very reliable 4-year Presidential cycle, the semi-annual "Sell in May" cycle - plus other technical signals such as the failed Santa Claus rally and the January Barometer.
Last week's extemes included the CBOE put/call ratio - jumping 20 points to 81, and the VIX jumping up 10. The McClellan Oscillator is oversold at minus 91, while breadth, based on Advance/Declines on the NYSE and Nasdaq were at least 1 to 10.
Here is the complete list:
| MktSentiment | Last Week | Prev. Week | 5 Yr HI | 5 Yr LOW |
| DJIA: | 10193 | 10620 | 14093 | 6626 |
| Nasdaq: | 2229 | 2346 | 2805 | 1114 |
| S&P 500: | 1087 | 1135 | 1561 | 683 |
| CBOE Eq. put/call: | 81 | 62 | 96-10/08 | 46-1/03 |
| VIX: | 40.1 | 31.2 | 90 | 8.8 |
| McClellan Osc: | -91 | -44 | 108 | -123 |
| McClellan Sum: | 53 | 542 | 1568 | -1514 |
| Newsletter Surveys | ||||
InvestorsIntel.Bull: | 43.8 | 47.2 | 63 | 22.21 |
InvestorsIntel.Bear: | 24.7 | 24.7 | 54.4 | 16 |
AAII Bull: | 41.3 | 36.6 | n/a | n/a |
AAII Bear: | 33.7 | 36.6 | n/a | n/a |
| Nova/Ursa Mutual Funds: | 0.98 | 1.19 | 2.2 | 0.56 |
| US Equity-1 week lag | n/a | -8.6B | ||
| Money Market Flows | -33B | 24B | ||
| ETF equity:Monthly Totals | Mar.805B | Feb.750B | ||
| Baltic Dry Index: | 3608 | 3608 | 11700 | 663 |
Bullish %: | 45 | 63 | 88 | 2 |
| Insider Corporate Sellers: | 22:1 | 15:1 | 108:1 | 2.4:1 |
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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