CYCLE "FOUR"CAST:

According to both JP Morgan data and Ned Davis Research, the Pre-election year of the 4-year election cycle is the best for stocks - in fact, it is better than the the other 3 years combined from 1940-2008! Going according to  plan, the 4th Q of the previous year (just past) was the best of all quarters, and the new quarter ahead should be the best of the 4 this year, followed by the 2nd Q. 
That said, short term conditions -despite Monday's great start - still look to caution based on previously mentioned Sentiment extremes: the AAII Bulls coming off a 63% reading (Bears off 16%); the SPX stretched above its 200-day moving avg.; a low 2% dividend yield and a 16 VIX recent reading. Longer term, margin debt continues to increase to $270B.
For the first time since last Spring, equity mutual funds showed INFLOWS.
  Here are the numbers:

DJIA:	11577	11573	14093	6626
Nasdaq:	2652	2665	2805	1114
S&P 500:	1257	1256	1561	683
CBOE Eq. put/call:	58	53	96-10/08	46-1/03
VIX:	17.8	16.5	90	8.8
McClellan Osc:	14	15	108	(123)
McClellan Sum:	538	463	1568	(1514)
Newsletter Surveys
InvestorsIntel.Bull:	55.6	58.8	63	22.21
InvestorsIntel.Bear:	20.0	20.6	54.4	16
AAII Bull:	51.6	63.3	n/a	n/a
AAII Bear:	20.1	16.4	n/a	n/a
US Equity-1 week lag	n/a	.3B
Money Market Flows	22.4B	(9.3B)
Baltic Dry Index:	1999	1999	11700	663
Bullish %:	854	84	88	2
Insider Corporate Sellers:	14:1	28:1	108:1	2.4:1

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CYCLE "FOUR"CAST: