BOO WHO

Not the scariest October in record, in fact one of the most expected corrections in recent years - sans Fed activity. Usually the Hallowe'en Effect creates a buying opportunity for stocks, but not last year, nor 2010.

Sentiment extremes quieted down last week, with the breadth (advance/decline) continuing UP and the Insider selling DOWN. In fact the 10% stockholders are Buying recently. The McClellan Oscillator went to a +68 - way overbought, hence the small selloff at today's open. MMF flows are making as violent swings as the markets.

Here are the numbers:

Date>		10/24/2014	10/17/2014
Indices:	DJIA	16805	16380
	NAZ	4483	4258
	SPX	1964	1886
WklyVolume (Bshs).	naz/ny	9.3/3.9	12.7/5.2
Specul.Ratio hi=bullish		2.38	2.44
Sentiment:	put/call-CBOE	63	75
VIX>50-alltmlow=8.8		16.1	22
Advance/Dec-NYSE..		2135/572	2000/1250
Weekly Net:		1563	750
Cumulative:		161787	160224
Weekly	NYSE hi/low	214/101	89/813
New Hi's/Low's	Nasdaq h/l	137/152	81/650
McClellan	Oscillator	68	10
McClellanSum	.+750/-1000	-353	-625
Newsletter	Inv.Intel -Bull:tues	35.3	37.8
Surveys	Bear:-5yrs	18.2	17.3
	AAII  -Bull :wed.	49.7	42.7
	Bear	22.5	33.7
COT:SPX w/w	large/small (net)k	(1k)/(7k)	0k/20k
COT:gold  comm.hedg	long-short.000	(105k)	(75k)
CEOinsider	selling	12:1	13:1
off.&bd b/s.vs.	10% holder b/s	210:25	160:20BUY
3-box rev	Bullish%-	48	41
US equity -ICI	Fund Flows	WeekDelay	(5.0B)
MMF flows	Change in $B	12.9B	(22B)
MargDebt- top (300M)	monthly
ETF:mthlyEqty/	Int'l/Bond-$B
2-yr Tsy Yield: Inflation		0.39%	0.38%

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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BOO WHO

ZUGZWANG

In Chess jargon the German word Zugzwang means "Forced Move", wherein the opponent has to make only one choice, and it is usually not a good one! As the investing world moves forward, fewer and fewer choices are available to prudent investors, and economists and Fundamental Analysts seem to be in unanimous agreement (usually a bad contrary sign) that the U.S. stock market will rise in the next three months to 2 years or more.

The Technical picture, based here on Sentiment Indicators is not so one-sided, although there are some eye-popping moves from last week - more explanation at:    http://www.examiner.com/stock-market-in-san-francisco/brent-leonard

Exchange Volume was at a 2014 high (Selling Climax?); the CBOE put/call ratio as well. The Commitment of Traders "smart money" - large traders, was dead even (buy/short), while the small ones were net long 20k.Finally, Insider Trading dropped to 13:1 sellers, but the surprise number was the 10% stock holders almost unanimously buying more stock!

Here are the numbers:

Date>		10/17/2014	10/10/2014
Indices:	DJIA	16380	16544
	NAZ	4258	4276
	SPX	1886	1906
WklyVolume (Bshs).	naz/ny	12.7/5.2	11.3/4.2
Specul.Ratio hi=bullish		2.44	2.69
Sentiment:	put/call-CBOE	75	72
VIX>50-alltmlow=8.8		22	21.2
Advance/Dec-NYSE..		2000/1250	801/2453
Weekly Net:		-750	-1652
Cumulative:		158724	160251
Weekly	NYSE hi/low	89/813	103/565
New Hi's/Low's	Nasdaq h/l	81/650	80/549
McClellan	Oscillator	10	-61
McClellanSum	.+750/-1000	-625	-475
Newsletter	Inv.Intel -Bull:tues	37.8	45.5
Surveys	Bear:-5yrs	17.3	14.1
	AAII  -Bull :wed.	42.7	39.9
	Bear	33.7	31
COT:SPX w/w	large/small (net)k	0k/20k	(7k)/24k
COT:gold  comm.hedg	long-short.000	(75k)	(63k)
CEOinsider	selling	13:1	40:1
off.&bd b/s.vs.	10% holder b/s	160:20BUY	175:40
3-box rev	Bullish%-	41	61
US equity -ICI	Fund Flows	WeekDelay	(.5B)
MMF flows	Change in $B	(22B)	17.0B
MargDebt- top (300M)	monthly
ETF:mthlyEqty/	Int'l/Bond-$B
2-yr Tsy Yield: Inflation		0.38%	0.43%

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

WILD WEEK

I knew if I went on vacation to San Diego for a week the market would go crazy - especially during this critical Sept.-Oct. span. Luckily, even with a few Sentiment and breadth extremes, my current investment strategies - DITM and especially Leaps are not directly affected. I shall be giving a talk on these this Saturday at the SF Option Group monthly meetup at Ft. Mason - 9 a.m. BLDG C (Rm.235) for local readers.

The overdue correction brought a few extreme readings in the last two posts - the previous week's unavailable (n/a) are updated today:
NYSE Volume increased as expected; also the CBOE put/call ratio and VIX did as well. Breadth (advance/declines) were negative for the fourth week - mutual fund outflows reached 6 straight weeks. The McClellan Oscillator was below -50, which again failed to see a buy signal today, and the Summation is at a recent low - hopefully support. Incidentally, Tom McClellan will be presenting at the TSAA annual seminar this month - please see my Examiner.com column if interested in attending:   http://www.examiner.com/stock-market-in-san-francisco/brent-leonard.

Finally, the 2-year Treasury yield dropped dramatically- all numbers are below:

Date>		10/10/2014	10/2/14*
Indices:	DJIA	16544	17010
	NAZ	4276	4481
	SPX	1906	1968
WklyVolume (Bshs).	naz/ny	11.3/4.2	10.0/4.1
Specul.Ratio hi=bullish		2.69	2.44
Sentiment:	put/call-CBOE	72	65
VIX>50-alltmlow=8.8		21.2	14.6
Advance/Dec-NYSE..		801/2453	1235/2012
Weekly Net:		-1652	-777
Cumulative:		160251	161126
Weekly	NYSE hi/low	103/565	92/445
New Hi's/Low's	Nasdaq h/l	80/549	105/410
McClellan	Oscillator	-61	-53
McClellanSum	.+750/-1000	-475	-272
Newsletter	Inv.Intel -Bull:tues	45.5	47.5
Surveys	Bear:-5yrs	14.1	15.1
	AAII  -Bull :wed.	39.9	35.4
	Bear	31	30.9
COT:SPX w/w	large/small (net)k	(7k)/24k	n/a
COT:gold  comm.hedg	long-short.000	(63k)
CEOinsider	selling	40:1	52:1
off.&bd b/s.vs.	10% holder b/s	175:40	175:40
3-box rev	Bullish%-	61	65
US equity -ICI	Fund Flows	WeekDelay	(4.1B)
MMF flows	Change in $B	17.0B	22.8B
MargDebt- top (300M)	monthly		463B
ETF:mthlyEqty/	Int'l/Bond-$B		1141/454/281
2-yr Tsy Yield: Inflation		0.43%	0.57%

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 WEEK

San Diego

Before I fly out on United's Ebola Gay to San Diego here is the week's Sentiment update a/o Friday midday:
Although the usual signal from the McClellan Oscillator did not work on Monday, it did kick in after the minus 50 (53) signal from Thursday - hence Friday's upsurge. The Bull / Bear surveys remained the same - the I I comes out on Tuesdays and the AAII on Wednesdays. Many n/as from the week in progress; individual insider selling remains strangely constant, with the Sector figures doubling - 25: to 52:1 sellers over buyers.
Finally the August numbers came in for margin debt (actually reported last week) just below record highs at 463B; ETF totals all rose to new highs - equity, Int'l and Bonds - despite Gross's departure.
Here are the numbers:

Date>		10/2/14*	9/26/2014
Indices:	DJIA	17010	17113
	NAZ	4481	4512
	SPX	1968	1982
WklyVolume (Bshs).	naz/ny	n/a	9.0/3.5
Specul.Ratio hi=bullish		n/a	2.57
Sentiment:	put/call-CBOE		69
VIX>50-alltmlow=8.8			14.9
Advance/Dec-NYSE..		n/a	646/2592
Weekly Net:		n/a	-1946
Cumulative:		n/a	161903
Weekly	NYSE hi/low	n/a	88/315
New Hi's/Low's	Nasdaq h/l	n/a	95/322
McClellan	Oscillator	-53	-43
McClellanSum	.+750/-1000	-272	-55
Newsletter	Inv.Intel -Bull:tues	47.5	48
Surveys	Bear:-5yrs	15.1	15.3
	AAII  -Bull :wed.	35.4	41.8
	Bear	30.9	28.2
COT:SPX w/w	large/small (net)k	n/a	(1k)/35k
COT:gold  comm.hedg	long-short.000		(64k)
CEOinsider	selling	52:1	25:1
off.&bd b/s.vs.	10% holder b/s	175:40	175/35
3-box rev	Bullish%-	65	70
US equity -ICI	Fund Flows	WeekDelay	(1.5B)
MMF flows	Change in $B	22.8B	15B
MargDebt- top (300M)	monthly	463B	463B
ETF:mthlyEqty/	Int'l/Bond-$B	1141/454/281	1141/454/281
2-yr Tsy Yield: Inflation		0.57%	0.58%nh

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

San Diego