Market Talk / Jan. 8 - 14

[The_Technician]

Buying high here????

If you want to see the importance of the 11,000 mark, look at the 10 year chart. Look how many times 11,000 came into play, 1999 to 2001.
http://bigcharts.marketwatch.com/intchart/frames/frames.asp?symb=DJIA , use 1 decade time frame.
Interesting the number of people who are now moving out of G or taking more out of G to put into the market. The S fund has been positive 5 days in a row, what are the odds of 6. If this isn't the real thing, talk about buying near the very top. Tom's survey so far - 60% Bullish, 19% Bearish. Is this the movement of the herd? Gold at $550.50, highest in 25 years. Oil back up to $63.50. I hope this is the real thing.

So, would you say that everything is being bought at a high price....???
The stock funds are maxed out.....not a good time to get in in my view....unless of course it just keeps on going and going and going....but with oil as high as it is, combined with interest rates, and so forth....only the fools buy high.....

 

[Show-me]

Nikkei down.

Nikkei is down tonight. Are ya getting scared.

 

[Birchtree]

Hot is the word.

Last week's four day rally marked the first time since 1988 that the S&P 500 rose in the first four days of the year consecutively - now we have five days of gains.

The big question: Will the groups that have been hitting records continue leading the way, or will the big U.S. stocks that dominate the S&P 500 and the Dow Industrials come back into their own? Many money managers have been saying for the past year that, as the economy grows less rapidly now, larger, more stable U.S. companies with big international market share may begin to outpace smaller companies and foreign companies. That analysis has been wrong so far, as s strong world economy has benefited foreign companies and smaller, faster-growing U.S. companies. I suspect that will transition to change. As a relative play, contrarians may say the rest of the world is overdone, and the U.S. has some catching up to do. Wonder Woman don't you agree? The big boys are still on the sidelines watching and getting ready to buy more highly weighted stocks that are components of the S&P 500.

That was a good read from Bill Cara - I'm just a nonbeliever in the bear case.

Remember, the fewer bulls the better.

 

[Skip]

Tech
Of course you could look at it as a breakout to the UP side.
11000 has been a ceiling many times...
Lets see if it holds for support ?
only time will tell. The market has been holding onto the gains very well so far...
Nice 5 days this year... we could get a pull back Tuesday...
But you expect that with this run from Oct's lows... small pull backs are very hard to trade in the tsp accounts... We had a pull back of over 200 points 11/28 to dec 30th . It would of been hard to trade it as it was choppy... Now its up for 300 points in 5 days...
but its only up from 10935 since 11/25/05 for 76 points..
76 points since nov 25 ? Look at it as a building base...
Traders will play with it until the small investors"greenies"
jump in and when all you see on the headlines is how great the market is then they will dump it.
11195 they will dump it.. JMHO

Skip

 

[Birchtree]

S&P 500 record high is 1527.46 achieved in 2000

The S&P 500's value is calculated based on the size of its components, so that stocks with large market values move the index the most. Large caps will kick. But if you counted all 500 stocks equally, regardless of size, the index would have hit a new record long ago - and wouldn't be 16% below its record, as the S&P 500 actually is. I'll just have to remain patient and dollar cost average into the foreseeable gains.

 

[Wizard]

Remember, the fewer bulls the better.

58% Bulls
22% Bears

What indicator do you use?

 

[mlk_man]

If anything I would expect a softer dollar over the next 30 days... You will have ups and downs.... 84 is a good stoping point or resting place in the near term.... Im not the best on the dollar flow... but we used to have a sweet girl on here that was....missing you

Skip

I'm assuming you're talking about Sarah? The "sweet" part threw me off. I believe her and Rolo rode off into the wild blue yonder on that white stallion called "I fund". ......If you talk to her, ask her to stop using ideas from this site at her new place will ya?

Remember, looks can be deceiving..................and manipulated......

M_M

 

[Quips]

next correction

It is extremely difficult to predict the next major -- 10% -- correction, but we know it is lurking out there somewhere.

Some on this board cashed out of equities after Christmas fearing a repeat of January 05. That didn't happen. Sentiment looks good for a positive return for this month.

However, we all know major corrections are out there. A 10% correction/sell off on the S&P would drop it to around 1170.

Most are counting on the Fed to increase rates one more time this month, but the unknown is Bernanke and what he will do after taking on the reins.

My guess is that he will NOT raise rates again and provide a pleasant surprise for those still invested in equities ... and gold investors -- lol.

Hey, if that happens we can look forward to a very nice first quarter.

 

[The_Technician]

Tech
Of course you could look at it as a breakout to the UP side.
11000 has been a ceiling many times...
Lets see if it holds for support ?
only time will tell. The market has been holding onto the gains very well so far...
Nice 5 days this year... we could get a pull back Tuesday...
But you expect that with this run from Oct's lows... small pull backs are very hard to trade in the tsp accounts... We had a pull back of over 200 points 11/28 to dec 30th . It would of been hard to trade it as it was choppy... Now its up for 300 points in 5 days...
but its only up from 10935 since 11/25/05 for 76 points..
76 points since nov 25 ? Look at it as a building base...
Traders will play with it until the small investors"greenies"
jump in and when all you see on the headlines is how great the market is then they will dump it.
11195 they will dump it.. JMHO

Skip

I took a good looksee at the data and it appears that the bottom line is due to correct in about 4 days from today 14th....thats if it will correct....seeing that the top line is maxed out for all the funds, I'd say some sort of correction will happen and that 10% is not out of the question, but remains debatable.....lets finish off this week and lets see where she goes.....its a boat without a compass.....but take a look at the dollar value for some direction.....dollar strengthens, funds will go down.....oil price will drop too.....which thinking about it, its about time for a downstroke in oil.....what do you think????

 

[robo]

Technician,

I agree the Market is ripe for a decline, but I don't think 10% is in the cards.
Unless we get some geopolitical event, like Israel bombing Iran, Bird Flu and a few others. The boys have made some money and will want to take some profits soon. The Shark pointed out in his comments he has already started taking some profits. The market needs a rest to go higher. We could easily see some more upside here, but the risk reward is getting skewed. Still on a buy signal on small caps from 1-4-06 at the open. Watching the I fund for a buying op. Some of the International Markets are due a pullback and will pull down the I Fund... If your a buy and hold, don't worry be happy. The market is showing normal patterns, but if you play the trends we are starting to get overbought again. This has been another nice little run.

 

[robo]

Some Comments from a TA about DOW 11,000.

Friday's new high for the Dow Industrials above the formidable barrier that 10940 has presented since March, 2005, confirmed the Dow Transportation high and produced a Dow Theory buy signal. As a result, it was a relatively easy matter for the Industrials to penetrate and close above 11000, for the first time since June 2001. The next important landmark is 11337.92, reached that May, and then there is the all-time high at 11722.98 reached January 14, 2000. That high was reached on a 140 point one-day rally, and was followed immediately with a 700 point decline over the next five days. Since then, the closest we have gotten to the high was in May, 2001, at 11337.92. Of course that analysis applies only to the Dow -- an arbitrarily selected and price-weighted group of only 30 stocks. The pattern for the broader and market-weighted S&P 500 Index was quite different, and presents a set of significant technical milestones all its own.

In the face of yesterday's strength, it is difficult to imagine that much of a consolidation lies ahead, and it is conceivable that a consolidation will be just a brief interlude before the attainment of further highs -- but eventually the piper must be paid. This means that there has to be a period during which the now 21 positive indicators will digest their gains and reload for the next thrust higher. I will not add to my 75% long position in the Discretionary Technical Portfolio until there is a consolidation, but I may consider adding an international ETF rather than a domestic one, after their current pullback has run its course.

 

[Cortez]

It is extremely difficult to predict the next major -- 10% -- correction, but we know it is lurking out there somewhere.

Some on this board cashed out of equities after Christmas fearing a repeat of January 05. That didn't happen. Sentiment looks good for a positive return for this month.

However, we all know major corrections are out there. A 10% correction/sell off on the S&P would drop it to around 1170.

Most are counting on the Fed to increase rates one more time this month, but the unknown is Bernanke and what he will do after taking on the reins.

My guess is that he will NOT raise rates again and provide a pleasant surprise for those still invested in equities ... and gold investors -- lol.

Hey, if that happens we can look forward to a very nice first quarter.

My opinion is that Bernanke will raise rates one time after taking over in order to command respect and fear from market participants. He can't be seen as a Dove from Day 1.

 

[The_Technician]

market shudder????

Maybe some sort of alert may be early but, the Dollar is getting stronger, I fund getting kicked, and there is a spike in the F fund volume.....

 

[The_Technician]

I RAN or is it IRAN

Technician,

I agree the Market is ripe for a decline, but I don't think 10% is in the cards.
Unless we get some geopolitical event, like Israel bombing Iran, Bird Flu and a few others. The boys have made some money and will want to take some profits soon. The Shark pointed out in his comments he has already started taking some profits. The market needs a rest to go higher. We could easily see some more upside here, but the risk reward is getting skewed. Still on a buy signal on small caps from 1-4-06 at the open. Watching the I fund for a buying op. Some of the International Markets are due a pullback and will pull down the I Fund... If your a buy and hold, don't worry be happy. The market is showing normal patterns, but if you play the trends we are starting to get overbought again. This has been another nice little run.

Would Iran do...???

Large negative impulses on the three stock funds.....large positive on the F .....so far......

 

[Wizard]

Would Iran do...???

Iran selling their crude for Euros - March 20th.
Return of the 30 year treasury auction - February.
Jan 15th credit card payments have to include principle.
Feb 1st $70B of interest only arms reset.
Sticker shock on gas bills for your house.
Fed is selling $64B in treasury debt this week. - a record

The start of the year rally is a massive headfake.

 

[Wizard]

Last week's four day rally marked the first time since 1988 that the S&P 500 rose in the first four days of the year consecutively - now we have five days of gains.

The DOW, the NASDAQ and the S&P 500 have all gone up together for 5 days in a row. The last time that these 3 indexes all went up for 5 days together was October 1987 before the crash.

 

[James48843]

Moving more out of stocks and into G

Last week I said I was moving from 100% stocks, and putting 30% into G to take some profits and lock them in. The IFT confirmation of trade message came through last night.

I currently sit at 30% G, 20% S, 20% C and 30% I. - with a move at yesterday's close with less into C,S,and I, and fleeing into G for 30% for comfort and safety.

After a weekend to digest the weekend's news, and a quick look at this morning's action, I am shuffling off a little more into G. The report someone made last week showing the strenth of the "S" fund makes me want to put a little bit more there, and reduce the exposure to I that I have at the moment.

So today I am going 60% G, and then 20% S, 10% I and 10% C, and we'll see what that does for a few days. I just hope that I am early enough today to get it executed today. I think the next couple days will be flat to down slightly. Time will tell if I am right. Having a nice 4% plus move the first ten days of Janaury is nice to hold on to.

Looking good, taking a breather, and getting ready for another move up later in the month.

JP

 

[Wizard]

10:00am 01/10/06 U.S. NOV. WHOLESALE SALES DOWN 0.7%, FIRST DROP SINCE FEB

10:15am 01/10/06 SNOW PROMISES 'STRINGENT' SPENDING FOR 2007 BUDGET

10:15am 01/10/06 SNOW: U.S. ABLE TO ATTRACT ALL THE CAPITAL IT NEEDS

10:15am 01/10/06 SNOW: CHINA MOVE ON RESERVES WON'T HURT U.S. ECONOMY

 

[vectorman]

The DOW, the NASDAQ and the S&P 500 have all gone up together for 5 days in a row. The last time that these 3 indexes all went up for 5 days together was October 1987 before the crash.

Here's link to Dow chart Jan 1987-Jan 1991, gold and silver index added in. Gold now is at a 25 year high. Hmmmm interesting...
http://bigcharts.marketwatch.com/intchart/frames/frames.asp?symb=DJIA

With this new format, I don't know if this link is working correctly. If not, then at Bigcharts.com click on quotes,djia, I for indicator, time, custom, enter for year 87 and 91, click on compare index, add gold and silver, then click on draw chart.

 

[Birchtree]

10% correction - bring it on - got dividends

Since the mid-1950s, price declines of greater than 10% do not begin at cumulative AD line recovery highs. Yesterday the NYSE common stock cumulative AD line set an all-time new high +425 net advances confirming the NYSE composite AD line all time high achieved last week. The common stock AD line new high confirmation resets the clock for the extension of the bull market from the 2003 price lows.

Robo - you got any pretty graphs?

Quips - this massive head fake feels so good - many targets taken out.

James - sorry to see you go so light - each his own money.

Cortez - We'll meet again at the bottom - just be patient and wait for me.

Dennis - perma bull #2