Market Talk / Jan. 28 - Feb. 3

[Show-me]

The job numbers have been inaccurate for months now. Even CNBC talking heads have noted this.

 

[Show-me]

Will we see profit taking in the afternoon? I say yes.

 

[vectorman]

The job numbers have been inaccurate for months now. Even CNBC talking heads have noted this.

Your right, this big revision situation started just a few months ago, even Mark Haines on CNBC commented on how can anyone trust the numbers coming out if there may be a big revision out the following month. :suspicious: Also watch the DJTA today and the next few days, its at a critical level for the Dow theory to be confirmed. If it happens, a big injection of money will start working its way into the market...right Birchtree.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?symb=DJTA

 

[James48843]

DJTA up big today to 5,023.17

 

[vectorman]

DJTA up big today to 5,023.17

What's important is not how it starts, but how it ends. Check out DJTA chart middle May and first week of July in 06.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?symb=DJTA

 

[Birchtree]

The DJTA was light by 0.13 points yesterday - just like the bugger to fail. If it does fail that will give us a triple top which ain't good - but Ferdinand and I have confidence to proceed upward. It's hard for price to move lower the higher the MCSUM is. We are in potential melt up territory.

 

[vectorman]

The DJTA was light by 0.13 points yesterday - just like the bugger to fail. If it does fail that will give us a triple top which ain't good - but Ferdinand and I have confidence to proceed upward. It's hard for price to move lower the higher the MCSUM is. We are in potential melt up territory.

It seems that if anyone wanted to manipulate the market, now would be a good time. Just buy into the DJTA and push it up to hold it above its previous record so that everyone will think the Dow Theory has been confirmed. Then bammm let the new money flow in. I know easier said than done, but just a thought.

 

[James48843]

DJTA now hovering around to 5,002


What is interesting to me is seeing the S&P 500 slightly stronger this morning than the small caps. I think that shows again that the markets may just be hitting the tops here.

It will be interesting to see where we are a week from now.

I'll probably be moving some more out of stocks and into "G" today. Currently I'm sitting 60% in "G", and perhaps will move another 20% in that direction. We'll just wait another hour and see where we are at the noon deadline.

 

[Birchtree]

Over the last couple days we've had a nice push higher on the SPX breadth MCO, taking out all of the near term high points needed for the price action to move to new recovery highs. A take out of the mid November spike in the SPX breadth MCO and this will give us the all clear that all-time highs in the SPX will be challenged on this current price advance. The previous all-time high on the SPX back in 2000 was 1528.22. Remem ber, the MCO is an accelerometer - it actually measures the amount of energy (money) that is coming into or out of the marketplace. Let'em buy everything.

Dennis - permabull #1

 

[fedgolfer]

... potentially good news for those looking to rebuy in the next few days... VIX hit 10, could head north.

 

[Birchtree]

The DJUA was needing 4 points for a new all-time high yesterday. Now it only needs .73 points more. The number needed is 462.19. We could be looking at a triple Primary trend buy signal for the Dow Theory. Just don't put it on Time Magazine.

 

[fedgolfer]

Birch, last night on Fast Money, Bolling advised DVY. A good buy and hold even if one is suspecting a correction... good dividend reinvestment. But VEIPX has even better weightings in their top 10 holding than DVY... which my wife has in her sep-ira... larger chunks in BA, XOM, etc., so I guess a portion of me is b&h a least for the next few months. Keep up the pump.

 

[Birchtree]

I can only covet the wish that I owned them both. Nice chart patterns.

 

[James48843]

Amazing way to end the day:

C fund + 0.17%
S fund +0.26%
I fund -looks like it might be up a penny or two,
F fund up two pennies -- +(0.12%)

All I can say is I just can't get over how strong this market continues to be.

 

[Show-me]

Will we see profit taking in the afternoon? I say yes.

Swing..........and a miss. S fund has run up nicely the last six days, odds are quickly rising against a seventh day. Looks like it could use a rest back to the 20 dma.

All I can say is I just can't get over how strong this market continues to be.

Ditto!

 

[Spaf]

Swing..........and a miss. S fund has run up nicely the last six days, odds are quickly rising against a seventh day. Looks like it could use a rest back to the 20 dma.

There was some profit taking....foul!
S-fund is over-bought!
For the up trend to be re-established a higher-low has to form.
February is one of the weaker months (STA).
You gotta figure your risk vs reward.

 

[James48843]

The TSP Survey done in November has been published, and the results are pretty interesting.

The report is 55 pages long, and contains a lot of interesting data.

Read the report here:
http://www.frtib.gov/FOIA/2006-TSP-Survey-Results.pdf

 

[robo]

Are you a Vixer?



VIX and More
"Your one stop VIX-centric view of the universe..."





Friday, February 2, 2007
The VIX and 3% SPX Drops

What happens to the VIX when the SPX drops 3% in one day? Does the VIX provide any advance warning of a selloff or merely serve as a contrary indicator after the fact?

Since 1990, there have been 25 instances in which the SPX has fallen 3% or more in one day. In analyzing those movements, it is important to remember that volatility has a strong tendency to cluster; as a result, a majority of the data points I looked at happened to fall within the same month and many were during the same week as another 3% drop. This should not be surprising, as almost all of the SPX plunges from the last decade have been triggered by the Asian financial crisis (including the spillover into Russia and Brazil) and the unwinding of the dot com bubble.

The following graphic depicts a composite view of changes in the closing price of the VIX on the 25 occasions from 1990 to the present in which the SPX has dropped 3%:

http://vixandmore.blogspot.com/

 

[robo]

Mike Burk thinks up again next week. Sign up for his free weekly report.


Conclusion
The market is overbought, but, seasonality is positive and none of the breadth indicators is suggesting a reversal.

I expect the major indices to be higher on Friday February 9 than they were on Friday February 2.

This report is free to anyone who wants it, so please tell your friends.
They can sign up at:
http://alphaim.net/signup.html

If it is not for you, reply with REMOVE in the subject line.

Thank you,
Mike Burk
YTD W2/L0/T3

 

[robo]

Big break out last week from small caps. If money is willing to chase the small caps and the 800 level holds we could be in for a big move up. I wouldn't look for any kind of big correction anytime soon friends if these support levels hold. The key is, if they hold. Risk/Reward! If you like to buy strength a new all time high should do it for you. I might make a short-term trade on weakness, but I will not add longer-term investment money at these prices.

Some Comments from FibTimer. I know Birchtree agrees with him.

Market Rally Ahead!
February 2, 2007

The stock market is signaling that a huge move is about to occur. Over the past five trading days the small caps have been extremely strong and the Russell 2000 Index (RUT) finally broke out to a new rally high on Thursday. The S&P 500 Index (SPX) has been strong since early summer 2006 with nary a correction for seven months. Little noticed three months ago, the SPX closed above a huge resistance level, the Fib 78.6% retracement of the entire 2000-2002 bear market decline at 1385, thus forecasting a run for its old 2000 highs at 1527.

The NYSE advance decline line is at new highs. The Nasdaq Composite (COMPQ) is the only index to lag but has been showing signs of life over the past week. Traders believe the Nasdaq and especially tech stocks are due for a decline, and they are selling into every advance. Disbelief is the last requirement for a new rally. If the Nasdaq Composite closes above 2503 in coming days, look for a new break out rally across the board for the stock market.

Posted on February 01, 2007 in Market Timing Commentary | Permalink | Comments (0) | TrackBack (0)


New Highs For MidCap SPDR Trust (AMEX: MDY)
February 1, 2006

Shares of exchange-traded fund MidCap SPDR Trust (AMEX: MDY) broke out to new rally highs Wednesday on heavy volume. Shares of MidCap SPDRs try to correspond to the S&P MidCap 400 Index and include such companies as Cognizant tech (NASDAQ: CTSH), Peabody Energy (NYSE: BTU) and Precision Castparts (NYSE: PCP).

Wednesday’s breakout should be followed by higher highs. Traders can expect $155.04 to be reached in coming days, and if that level is surpassed, MidCap SPDRs could reach $161.96 in coming weeks before a significant correction occurs.

Fibtimer.com (http://www.fibtimer.com) also holds a position in the MidCap SPDRs in its ETF Timing Portfolio.

Posted on January 31, 2007 in Trading Picks and Pans | Permalink | Comments (0) | TrackBack (0)

Is Strength In Ishares Russell 2000 (AMEX: IWM) Predicting A Rally?
January 31, 2006

Shares of exchange-traded fund Ishares Russell 2000 (AMEX: IWM) are showing strength even while the rest of the stock market is moving mostly sideways. The Russell 2000 Index (RUT) and Ishares Russell 2000 have been weak for months, trailing the S&P 500 Index (SPX) and even the Nasdaq Composite Index (COMPQ) which itself was lagging.

But the last several days have seen Ishares Russell 2000 push higher and they are now just a fraction from new 2007 highs as well as new rally highs at $79.38. Watch for a solid close above this level. A breakout in small caps could be the lightning rod for starting the next leg up in the stock market.

Current top holdings in Ishares Russell 2000 are, Plains Exploration & Production Company (NYSE: PXP), Joy Global Inc (NASDAQ: JOYG) and Crown Holdings (NYSE: CCK). Fibtimer.com (http://www.fibtimer.com) also holds a position in Ishares Russell 2000 in its ETF Timer Portfolio.