Bull Pen - Fall 2006

[Birchtree]

The downward trend in the market's P/E ratio is now under some pressure to break to the upside, which suggests that P/E multiple expansion is quite possible over the next 1-2 years. Earnings will be the driver. Earnings have been rising fastewr than the stock market, which has functioned to compress the aggregate P/E ratio of the SPX quite significantly. Maple on Snow.

 

[Birchtree]

From Carl:
http://www.decisionpoint.com/chartspotlitefiles/061208crash.html

 

[Birchtree]

A yield of 4.5% on a 10 year Treasury note may look like a bargain a year from now when it is sitting much closer to, or below, 4%.

Year to date, the Dow is up 14.8% while NASDAQ has gained 10.5%. Trading the DJIA using a buy/hold strategy has produced a gain of 1589 points (14.8%) while utilizing the Market Edge long/short approach would have generated a loss of 982 points (-9.2%).

12/8/06 RA-AD line = 164,733
3/13/1959 RA-AD record = 166,190

12/8/06: NYSE Composite Ratio Adjusted AD line needs less than 4800 new raw advances to break the all-time RA-AD line high set in 1959. I can't wait.

 

[Birchtree]

The NYSE breadth MCSUM is at a reading of +1127, the higher and higher we go, the longer and higher the price pattern will eventually go after the MCSUM exhausts itself. Pay particular attention to how little optimism has been regenerated. That is very good, and an indication that this bull market has a lot of growing to do before it reaches maturity. The wall of worry is still very intact. Earnings momentum will return as the main characteristic to drive stock prices.

 

[mayday]

I'm trying to figure out why they would pad #'s Slow it down?

They needed the dollar to rebound thats why they padded the numbers. Thats why the dollar shot up Friday and the I fund had a negative FV. of 14 cents

 

[mayday]

I fund looking good so far Aisa is all green Europe looking fair as long as the dollar does'nt do anything wacky.

 

[vic]

The dollar has to rebound or all those imports are going to be too expensive. Also those countries holding large sums of USD will loose too much.

 

[mayday]

The dollar has to rebound or all those imports are going to be too expensive. Also those countries holding large sums of USD will loose too much.

I just have to remember how they manipulated the employment #'s its effect on the dollar and what it did to the I fund. Dont forget. What a market mover.

 

[vic]

Mayday, remember nothing happens by chance or accident. everything is manipulated.

 

[350zCommTech]

I just have to remember how they manipulated the employment #'s its effect on the dollar and what it did to the I fund. Dont forget. What a market mover.

On Friday, it was a combination of the job numbers and Mr. Paulson's comments that shot-up the dollar. Actually, Mr. Paulson's comments had the most bang. Remember, "watch what they do and not what they say".

 

[Birchtree]

Fed officials, who have universally voiced concerns about inflation, are expected to keep short term interest rates steady at 5.25% at their policy meeting tomorrow. But bind markets have priced in a small chance of a rsate cut this week and one-quarter percentage point cuts over the next 12 months. Markets anticipate those cuts in part because they see parallels to 2000. A technology stock and investment bust began to unfold in the summer of that year, yet in November the Fed still said its principal concern was inflation, not economic growth. Seven weeks later, with stock prices tumbling and businesses canceling investment plans, the Fed made the first of 13 interest rate cuts. Watch what they are doing, not what they say - they are not your friends. Noel.

 

[Show-me]

Holy crap, no truer words. They recommend a stock and it rockets up the next day. Wish I was in their circle of friends.

Though CNBC briefly seemed professional in the wake of the 2000-2002 market plunge, airing short conversational spots where the anchors emphasized journalistic responsibility, that tenor has now been replaced by carnival-barking shows like “Mad Money,” complete with its lightning round, featuring a shrill whine of irresponsible speculative “plays” backed by death-metal guitar music, and “Fast Money” promoted by spots that promise, for example, “Tonight, the boys get down and dirty with a hot commodity...” I wish I was making this up.

 

[Birchtree]

The SPX tends to rally during expiration week. In fact, during the past 11 months, the SPX has suffered a weekly loss during the week of expiration only three times and the average return during this time period is a gain of 0.64 percent.

 

[Birchtree]

At 9075.72 we have a new all-time high in the NYSE Composite. Even on a soft Dow day we have good internal action. I'm simply waiting for the next advancing sequence. Love that Figgy Pudding.

 

[airlift]

Also, up volume was higher than down volume in the NYSE and in the Nasdaq.

 

[Birchtree]

2002 to current - S&P 600 small cap +73%
2002 to current - S&P 400 mid cap +59.6%
2002 to current - S&P 500 large cap +22.9%, that's one more reason for me to like the C fund. Our day will come.

 

[Birchtree]

Rumor has it that Mital Steel is sniffing around my Worthington Steel (WOR) which means I lose another one to a buy out - but at a premium though. I like bidding wars to develope. If it goes I'll use the money to buy a few more wall flowers.

 

[Birchtree]

The WSJ noted that - Investors to money market funds added $21.26 billion in the week ended Tuesday, bringing total net assets to a record $2.333 trillion. The previous record stood since Dec. 10, 2002. About 86% of the money came from institutional investors - $18.32 billion; individual investors contributed $2.94 billion.

U.S.November CPI unchanged vs 0.2% rise expected. Overall prices had fallen 0.5% in October after falling by the same amount in September. That's the first time CPI has not risen for three consecutive months since the last three months of 2001. Taken together, those three months translated to a 3.9% annualised decline in headline inflation.

Gee, the Fed might have to start worrying about deflation again. I wonder where all that cash will flow to when rates start to crumble? That's right - it becomes part of the wave 3 of 3 structure. Snort.

The weekly cumulative RA-AD line continues breaking record after record. The weekly RA-AD line diverges with price long before a serious price correction unfolds. Due to that characteristic, the probability is very low any major price decline is in the cards over the coming months. It's time to pay to play.

 

[Birchtree]

I paid to play today and I'll pay more tomorrow and perhaps the following day - Ferdy and I have some serious work to do. I want to be in up to my eye brows come January.

 

[FUTURESTRADER]

HELLOOOOOOO BAHers, 20% diversifiers, L2040ers, oh...and Desperados, enjoy your day, that is all

sorry, couldn't resist. One day does not a trend make.