IBD 294.78 -.75 DJT 5098.82 +3.69 DJU 405.40 +1.97 VIX 15.45
US Gov rates: 6 mo .195% 2 yr .6341% 10 yr 3.35 +.02 30yr 4.45 +.02
Gold 1387.40 -1.40 Silver 29.38 -.01 Copper 4.27 -.01 Platinum 1730.90 +7.90
Oil 90.48 +.66 RBOB 2.41 -Nat Gas 4.15 +.09
Aussie 1.0034 +.0045 EURO 1.3047 +.0003 Pound 1.5300 -.0075
USD Index 81.06 - DBC 27.01 +.13
Days to option expiration 20 Day 2 of December Expiration 12-17
Long Term Opinions:
Bonds: Major long term top forming. .... Current trend down
Stocks: Secondary bear market rally ending...... Current trend up stalled
Gold: Primary top forming crash expected..... Current trend up stalled
Oil : Secondary bear market rally ending..... Current trend up stalled
Commodities: Bear market rally ending..... Current trend up
Real Estate: Bottoming ..... Current trend down
Stocks: Secondary bear market rally ending...... Current trend up stalled
Gold: Primary top forming crash expected..... Current trend up stalled
Oil : Secondary bear market rally ending..... Current trend up stalled
Commodities: Bear market rally ending..... Current trend up
Real Estate: Bottoming ..... Current trend down
US Dollar: Major long term bottom forming .....Current trend up
US Economy: Double dip coming .....Current trend neutralEmerging Markets: Bear market rally ending..... Current trend up
World economy: Current trend slowing
World political environment: Tension, aggravated
Where's Waldo: Waldo is buying Gold, Bonds and Emerging Markets.
Economy:
Case/Schiller home price index fell .8% in Sept Prices +.6% from 1 year ago
12-2 jobless claims rose 26000 to 436000 presented as a positive
November same store sales rose 5.3% vs a year ago presented as a positive for a nice Xmas for retailers
12-3 Non-farm payrolls rose 39000 in November a 10 month low. Jobless rate at 9.8%
Goods producers trimmed 15000 jobs Builders cut 5000 workers. Retailers cut 28000, government cut 14000. Service firms added 65000
Underemployment rate was 17%
ISM service sector rose .7% to 55
Analysts stuck to their view that the economy is recovering at a modest pace.
Proposed by Obama: 2 Yr extension of Bush tax cuts, Div and payroll tax remain at 15%, 13 month extension of unemployment benefits, 2% cut in payroll taxes for 1 year, 1 yr cut in SS taxes, estates taxes 35% with 5 million exemption. Estimated cost: 450 to 600 bil over 2 years
12-10 Trade deficit fell 13.2% in Oct to 38.7 bil
12-13 Retail Sales +.8% in Nov x Autos +1.2%
Autos fell .8% Building Materials fell .1%
Producer Prices +.8% core +.35 Gasoline +4.7%
Business inventories +.7% to 1.42 trillion highest since Feb 2009
12-20 New home sales edge up to a very low 300,000, existing home sales 4.65 mil rate
Case Schuller (20 city index) Sept housing index show home prices fell .8% a new low
Noteable:
China PMI at a 7 month high
Iran and N. Korea defiant on Nukes
China to be aggressive on monetary controls
Treasury to sell all of its shares (2.4 billion) in CITI at public offering
Goldman Sacs forecasts 25% gain for stocks next year.,1650 for Gold, advises shorting the dollar
China increased bank reserves for 3rd time in a month to 18.5%
China trade deficit with US fell 8.3%
China inflation expected to be 5.1%
Nasdaq rose for 8th day in a row to new highs
12- 17 Tax cuts extended. Tea party defeats appropriation spending bill.
12-20 State deficits and decling Federal money to hurt economy
South Korea artillery driis ..no respone from the north
Stock Market Trends
Mikey Short term up 12-6 11362
Mikey Intermediate Trend: Up 09/03/10 10477
Mikey Long term trend: UP 10/13/10 11052
IBD : 12-21 Market in confirmed uptrend 11478
Short Term Trading Indicators
Mikey OB/OS index (80 OB 20 OS) .98 (market very OB )
Put/Call Ratio(.6 OB 1.2 OS).46
10 day average .57
Ratio Put Premiums/Call Premium (extremes .60/ 1.54) .55
Put Premium 10 day average 57
Sentiment Total Score: Put/call + premium ratio = 1.01
10 day Sentiment Total Score: Put/call + premium ratio =1.14
Williams %R 12 day --3.13, Weekly --.89
% Advisory Service Bulls 58.8 Bears 20.6 Bull/Bear ratio 2.85
Mikey Thrust indicator: Daily 10 Weekly 10 (1 low, 10 max) 18,-0
DJIA MACD 102.40 Rising / Positive cross 12-3
NYSE New Highs 223 New Lows 18
NASDAQ New Highs 208 New Lows 26
NYSE Advance-Decline +675 NASDAQ Advance-Decline +137
Mikey A/D line.(from 9/17/10). NYSE +13614 NASDAQ +7582
NYSE % above 200 day ave: 75%
Support: 1130 SPX, 10720 DJIA Breakout 9/20
Resistance: 1220 SPX; 11200 DJIA
IBD 100 index Breakout 9/2 242.87
Comments:
12-3 MACD Positive cross
IBD market in confirmed uptrend
12-6 Power numbers turn positive
Mikey short term up
12-7 Extermely low sentiment numbers...very overbought
Possible Metals reversal
Conclusions: Upside Price trend resumes
12-14 AD line and NH/NL do not confirm DJI new high
New lows hit a 1 month high
30 year bonds return to April lows (amid Fed buying??????)
12-15 IBD Market under pressure
12-17 Gold MACD second negative cross RSI 46..bounced off of 50 day
New highs, AD line non confirm new high in DJIA
Options expire
12-20 Nasdaq rallies to new high for 3rd straight day.
IBD market in confirmed uptrend
New highs in DJIA, S&P, NASDAQ.on low volume, confirmed by A/D line non confirm by NH
12-21 New high in all indexes on low volume, confirmed by A/D line not confirmed by NH
Gold bouncing just above 50 day average
12-23 Sentiment indicators one sided. extremely overbought. Puts are extremly cheap
Mikey O/B O/S is at 98. 10 ave Put/call .57 10 day ave Put/call premuim .87
Moving Averages
5 day 11512 Rising/Price above
20 day 11356 Rising/ Price above
50 day 11248 Rising/Price above
200 day 10710 Rising/Price above
20 week 10944 Rising/Price above
50 week 10642 Rising/Price above
90 week 10057 Rising/Price above
200 week 10918 Falling/Price above
World Markets, Commodities, Currencies
DJIA 89 Emer Mkts 64 China 44, Brazil 43 Europe 67 Russia 80
Japan 58, Korea 80, India 63, Australia 63 Germany 36, Spain 45, UK 77
Oil 68, Nat Gas 34, Gasoline 64,
Gold 56, Copper 74, Silver 55, Platinum 72
USD 57, Aussie 64, Euro 54, Brit Pd 38, Yuan 40, Yen 56
Grains 60, DBC 73
Jesse Livermore, legendary trader of the early Twentieth century, had a rule: The stock market is designed to fool most of the people, most of the time. We may be in fool territory.
According to the most widely followed sentiment measure on Wall Street, the number of stock market bulls out there is eerily approaching the highest level since October 2007, the month the stock market hit an all-time high and the worst financial credit crisis since The Great Depression ensued.
The number of bulls rose to 58.8 percent this week, the highest since the 62 percent reading three years ago, according to the long running survey of financial newsletter writers conducted by research firm Investors Intelligence.
The velocity of the conversion from bull to bear is impressive, notes Investor Intelligence, as bulls numbered just 29 percent at the end of August.
“I know of not one bear for 2011,” said Peter Boockvar, chief equity strategist for Miller Tabak. “With the European problems still very much alive, a mini earthquake in the U.S. bond market over the past few weeks, and the likelihood of higher interest rates in Asia and Latin America too, the bulls better be a bit more careful here.”
Those that have turned bullish since August have been rewarded. The S&P 500 is up 23 percent from its 2010 low posted in July as a second round of quantitative easing by the Federal Reserve, improving employment figures, and a tax compromise in Washington fueled further gains.
But now, with so many bulls out there, which bears are left to convert into buyers and take the market even higher, contrarian investors said.
The "USA Today" ran an interview this week with five Wall Street strategists, including Blackrock’s Bob Doll, Goldman Sach’s Abby Joseph Cohen and Bank of America Merrill Lynch’s David Bianco. The headline screamed — Experts Agree: Get Over Your Fear and Get Back Into Stocks.
“I have to admit that as a contrarian, I love articles like this,” wrote David Rosenberg, chief economist & strategist for Canada’s Gluskin Sheff, in a note this week. “The article concludes that ‘each panelist predicted double-digit gains in 2011.’ Now that is what I would refer to as groupthink!”
Rosenberg made a name for himself for his bearishness ahead of the credit crisis despite the fact that he was employed by a firm at the very heart of the problem, Merrill Lynch. This year at Gluskin Sheff, he’s come under fire for remaining bearish during this second half rally in stocks, saying that we’ve yet to pay the price for the housing market collapse and the subsequent bailouts.
That brings us to the one problem with going against the herd to soon. The herd can be right for a long time, traders said.
“This is where it gets slightly complicated because I always wanted to trade along the line of least resistance, so I was generally moving along with the crowd, the herd, most of the time,” said Livermore, according to a 2001 biography entitled, ‘Jesse Livermore, World’s Greatest Stock Trader’. “It was when the change in trend started to appear, the change in market direction, that was the most difficult change to catch and act upon. So I was always ready to separate myself from the popular thinking, the group thinking.
The readings I am getting all all one sided now. Indicators are flashing da strong danger signal. at the end of 2010. .
Mikey
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