Home >
Report Archive > 2004
Visit
the DailyOverview page for the latest
reports
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2004 Report Archive
December intraday updates
In the Sweet Spot, But...
12/22/04 11:53pm EST
Available cash at NYSE clearing firms is
beginning to dwindle, but there is a lot in reserve, and a decline is
actually bullish for the long-term outlook. Also, the recent
decline in the VXN is typical of this time of year, though it often
precedes a market decline early in the new year.
Now, Or...A Few Weeks From Now
12/16/04 8:20pm EST
We can back out the effects of market
performance and interest rates on the Investor's Intelligence sentiment
survey to get a better read on whether we are seeing excessive
bullishness or not. Current analysis shows that this population is
too bullish given the inputs, though it is not to as great a degree as
the raw numbers would suggest.
The Window is Getting Smaller
12/14/04 7:45pm EST
The structure of the market since the March
2003 low is close in comparison to 1998, especially so if we include the
number of new highs on the NYSE, which are diverging from the new highs
in price. Also, we repeat what has become a consistent pattern
regarding the reaction of stocks and bonds on a day the Fed raises their
rate target.
Oversold Frustrations
12/09/04 8:50pm EST
Extreme volume spikes in SMH while it
formed an intraday reversal had a tendency to lead to nothing consistent
in the short-term, but 60 days later the index was lower nearly every
time. Also, a comparison of SMH volume to the underlying stocks
shows that investors are just now going back into the "safety" of SMH as
opposed to what we saw in late November.
Drops After a High
12/07/04 8:15pm EST
When the Nasdaq 100 has dipped more than
1.5% soon after making a new high, and bullish sentiment is already very
high, nearly always the index has gone on to further gains when looking
out more than a few days. Also, odd lot traders have been shorting
this rally to an excessive degree, typically a very bullish sign.
Friday's Trading Should Set Tone for Weeks
12/02/04 8:30pm EST
When Intel comes out with positive news
after the Nasdaq 100 has already made a new high, and INTC gaps up huge
the next day, it has had a good tendency to mark at least a short-term
top in the broader technology market.
December Dump? It Better Happen Fast.
11/29/04 9:00pm EST
In nominal dollar terms, commercial traders
are short the big three indexes to a nearly-record degree. Also,
options traders are buying more calls than puts to a large degree, a
remarkable shift in character from a few weeks ago. If we are
going to see a meaningful decline during December, history suggests it
will not happen during the last two weeks of the month.
Ratio Worries
11/18/04 7:35pm EST
The SPX/VIX ratio is a misleading sign of a
market top. Also, a divergence between NDX gains and negative
breadth has signaled some short-term weakness in the past, and a
long-term look at Nasdaq short interest is another mark in the bullish
column.
A Long-Term Look
11/16/04 9:15pm EST
The breakout in the S&P 500 from a
long-term range carries historically positive connotations. We
also look at cash balances at NASD regulated clearing firms and a
potentially bullish pattern in the positions held in S&P 500 futures
contracts.
No Rest
11/11/04 8:00pm EST
The TICK on the NYSE spent only 1% of its
time below zero today, which is sign of buying pressure exceeded only
once in the past three years. This type of pressure normally lasts
over the next few days, but does not seem to have longer-term
implications.
Speculation Still Rampant
11/09/04 7:30pm EST
Rydex asset moves between the Europe and
Japan funds provide the potential for a pairs trade between the two,
readily available via exhange-traded funds. However, they are not
yet at a point where it is a high-odds opportunity to do so. Also,
we look at our OEX Determination Index, which is signaling that those
traders are building up put positions.
Risk is Now Significantly Higher
11/03/04 8:20pm EST
In addition to Rydex trader fleeing the
money market, they are putting their money into the most speculative of
issues, as our Beta Chase Index records a new all-time high. Also,
odd lot purchases have spiked to a very high level over the past week,
something last seen only at prior market peaks this year.
A Note of Caution, But It Still Looks Good
10/28/04 7:50pm EST
Watching the amount of money in the Rydex
money market fund, relative to total assets in the other index funds,
has been a good exercise in seeing the extremes in trader sentiment this
year. Currently, the assets are very low, something which has been
consistently bearish for several years. However, we should see
some outright speculation in our other measures before counting out this
rally.
Reversal Should be Authentic
10/26/04 7:45pm EST
Rydex traders have seemingly abandoned
banking and financial services shares, a sign that has had a 100%
long-term success rate - on the upside - for the shares in the past.
Also, we look at the recent whipsaw pattern in the S&P that also
suggests higher prices going forward.
Continued Chop a Good Sign
10/21/04 9:10pm EST
The proportion of volume in Nasdaq shares
compared to NYSE shares over the past month have fallen to an extreme
level. Over the past seven years, such low levels of "speculative"
volume have been positive times for the broader market.
Getting Closer in Time and Price
10/19/04 9:20pm EST
The lowrisk.com sentiment survey came out
with its 3rd-lowest number of bullish respondents in its history.
The two times before that lead to some short-term losses, but good gains
after that. Also, the S&P and crude oil have traded in a fairly
predictable pattern over the past year - something that if it continues
should be bullish for stocks.
Now We're Getting Somewhere
10/14/04 8:00pm EST
Whenever the TICK on the NYSE has hit -1000
intraday, and the S&P goes on to lose another 1% or so the next session,
it has actually been an extremely bullish event, as the market often
bottom soon afterward. We see a similar pattern after VIX
reversals from low levels, and the put/call ratio being above 1.0 for
four out of five days.
Lack of Extremes
10/12/04 9:00pm EST
A study of gaps in the Nasdaq 100 shows
that the overriding market environment does not materially impact how
long it takes most gaps to fill. And when a gap down is covered
the same day, it has not lately been a bullish phenomenon. Also,
we look at a simple trading system for transportation stocks based on
the price action of crude oil.
Trading Range Within a Trading Range
10/10/04 9:30am EST
Oil's impact on stocks, particularly
transportation stocks, may be overstated. While there is certainly
a negative correlation between the two, it is not an end-all, be-all
tell for the group.
Skepticism is High on Further Gains
10/05/04 8:30pm EST
Taking a look at a different type of
put/call ratio, we see a pattern of traders becoming less and less
speculative on each market rally this year. That is a positive
sign of disbelief, and should limit losses going forward until that type
of behavior changes.
Not the Time to Chase Them Higher
10/03/04 9:30am EST
Judging by our shortest-term model for the
Nasdaq, we should see a little more strength early in the weak, but at
some point we suspect prices will fall back into Friday's range.
Also, a long-term look at put/call data should be quite encouraging to
those bullish on the market.
Giving Up on Semi Stocks
09/28/04 8:00pm EST
Traders have been showing near-complete
apathy towards semiconductor stocks lately, a positive sign that further
downside should be minimal. Even when the sector rallies, traders
have not been jumping on board, and they have been eschewing individual
stocks for SMH.
Correction Should be Tamest of the Year
09/23/04 8:00pm EST
This week's dramatic reversal of a new
monthly high looks ominous, but precedent suggests that it would be rare
to see further severe selling pressure. Also, total assets in the
Rydex leveraged bull funds are close to undercutting the level they were
at before the rally began - a sign of distrust that should limit further
losses.
Another Meeting, Another Reversal?
09/21/04 8:00pm EST
A longer-term sum of the NYSE TICK suggests
that buying pressure has been extremely persistent, to a record degree.
Past occurrences of very high readings were followed by market weakness
going forward, and we should expect the same this time around.
Also, we reiterate the market's propensity to reverse any gains seen on
a day the Fed meets.
Traders Looking (too) Confident
09/16/04 8:00pm EST
Odd lot traders, those who trade stock for
fewer than 100 shares at a time and who tend to be wrong at extremes,
have been buying aggressively over the past few weeks. The only
other times they have been this aggressive, the broader market has seen
weakness in the intermediate-term future.
Looking to Reach Overbought by Expiration
09/14/04 8:00pm EST
How the S&P performed in September had a
consistent influence on how October performed as well, especially if
September was positive. Also, we look at a different way of
viewing the Commitments of Traders data that has been effective even
while our other methods of looking at that data have not.
Rydex Traders vs. ETF Traders
09/12/04 10:00am EST
Rydex traders have not been "buying into"
the current rally as much as they did the previous two 5% rallies this
year. This kind of hesitation is a good sign. On the other
hand, volume in the SPY exchange-traded fund is lagging well behind
volume in the underlying shares, suggesting an unwelcome confidence in
traders willing to hold individual equities.
A New Low in the VXO
09/07/04 8:30pm EST
How the S&P performs the week after Labor
Day has had a fairly consistent record at predicting moves the rest of
the month, particularly if the week closes negatively. Also, we
look at the implied volatility measure VXO, and how unusual it is to see
it scraping along at its lows while the market is not at its highs -
particularly entering one of the most volatile months.
Intel's Role as a Bellwether
09/02/04 9:30pm EST
Intel looks like it's on its way to a large
gap down open tomorrow. When that has happened in the past, it has
had a negative affect on the broader market that day as well as into the
future. But with so many cross-currents currently in place, we may
only get a better feeling of future direction once traders return next
week.
Funds Continue to Deploy Cash
08/31/04 7:30pm EST
When short-term interest rates are low,
mutual funds have an incentive to put their cash to work, thus we
normally see them hold low levels of cash reserves. Recently,
however, even while rates have climbed, cash levels have stayed steady.
While the cash deficit is not yet extreme, the market has still
underperformed when a deficit existed. Also, a brief look at
September seasonality.
Short-term Decline Should be Just That
08/26/04 7:25pm EST
By looking at whether traders are buying
into new long positions or covering existing shorts, we can get an idea
of the strength of a future trend, particularly if we look at how the
market has performed leading up to this time. Also, the Investor's
Intelligence sentiment survey has shown a drastic decline in bullish
opinion over the past 8 weeks, a very good buy signal in recent history.
Rally is Gaining Acceptance
08/24/04 9:50pm EST
Odd lot traders have been approaching the
market in a similar fashion to other peaks so far this year, suggesting
a short-term rest is more likely than significantly higher prices.
Confirming that is a divergence between the VXN and its underlying
index, the NDX.
More Confirmation of a Low
08/22/04 12:30pm EST
Sentiment in the long bond market is as
negative now as it was in March. This suggests that yields should
have a tough time remaining this low or especially pushing lower.
Also, volume so far this month is actually running above average for
this time of year, confounding arguments that it is abnormally low.
Waiting for the Entry
08/17/04 8:30pm EST
OEX traders now have more call option
contracts outstanding than put options, the first time since March 2003.
Also, the ratio of open puts to open calls has declined extremely fast
in the past six months, something that has been an excellent buy signal
over the past 10 years. Also, we saw an intraday thrust from the
TRIN that has only been seen coming out of the lows in March and May of
this year.
Watching This Week Closely
08/15/04 11:45pm EST
We have finally seen a spike higher in our
R.O.B.O. put/call ratio, a welcome sign of small-trader pessimism.
For the first time since the spring of 2003, these traders spent more
than 22% of their volume on purchasing puts to open, a sign of panic
that should lead to a good low.
Nearly Every Day, Another Piece Falls Into Place
08/12/04 9:45pm EST
Speculative trading in over-the-counter
stocks has declined 63% since the beginning of the year. While it
has not yet fallen to a degree that suggests these traders have given up
on the most speculative of all trading, it is getting close to that
point. Also, we take another quick look at the breadth figures in
the S&P versus the NYSE as a whole and determine that there is little
difference, at least for our purposes.
Looking for One More Push
08/10/04 9:10pm EST
Total assets in the Rydex bear funds is
close to setting an all-time record. Previous peaks in these funds
have coincided well with market lows over the past two years.
Also, a look at a past Fed decision day suggests that today's strength
will be quickly reversed, perhaps leading to a new leg down (or at least
a short-term decline).
Point of Recognition
08/08/04 10:45am EST
Friday saw a record put/call reading from
the CBOE. Looking at other extremely high put volume readings,
most of them coincided with a clear technical breakdown. On
average, the market formed a major low within a few weeks, and the day
of the high put/call ratio was rarely the day of THE bottom.
The Most Difficult Inflection Point All Year
08/05/04 8:45pm EST
Our Down Pressure gauge on the Nasdaq 100
reached one of its highest readings in years today. A very
short-term indicator, this type of action typically means than any early
weakness (such as a gap down open) is usually reversed, at least for
very short-term traders. Also, a decline in the put/call ratio on
a large down day is not necessarily a bearish sign over a bit of a
longer-term time frame.
Decline Should Set Stage for Longs
08/03/04 8:15pm EST
The lowrisk.com sentiment survey is showing
that its respondents are at one of their most bearish points in seven
years. Other times the survey has shown such bearishness have been
almost universally excellent buying opportunities. Also, we update
a sector spread play identified using Rydex asset analysis.
Convention(al) Thinking
07/29/04 8:30pm EST
Looking at market activity around opposing
parties' political conventions, not much of a pattern emerges. The
market is most often quite positive going forward, but it's difficult to
assign cause to the conventions. Also, a look at 20 years of crude
oil and stock prices - the correlation isn't as negative as most would
believe.
Lots of Odd-Lotters (Well, Sorta)
07/27/04 9:00pm EST
Odd lot traders, those who place a trade
for fewer than 100 shares, have been aggressively shorting, betting on a
continuing market decline. We show that the history of these
traders doing this kind of shorting has lead to a positive market every
time. So far this year, this group of traders has had a nearly
spotless contrary record at calling market turns.
"Range-think" Still Pervasive
07/22/04 7:30pm EST
The dreaded cross of the 50-day moving
average below the 200-day average is made out to be much more maligned
than it should be. Depending on the index, it has not necessarily
been a bad sign historically. Also, a relatively new option gauge
from the ISE has shown a bit of pessimism from traders, but not quite
what has been seen at past lows.
Not Much That's New...Still No Confluence
07/20/04 9:00pm EST
The recent new 52-week high in many
utilities has actually been a pretty good bullish bellwether for the
broader market. Conversely, new lows in those types of stocks have
lead to poorer-than-average performance in non-related stocks.
Also, our short-term measures have become extremely overbought, a
troubling sign for the very near-term.
Trading Range Sucking In More Believers
07/15/04 8:00pm EST
Bullish opinion in the Investor's
Intelligence survey has not abated much despite mild declines in the
market. While this seems troublesome, it is not entirely unusual -
in fact, it is just about average. Still, the absolute level of
bullishness remains extremely high (not good). Also, we revisit
unusual TRIN readings, once again at the fore.
More Time Needed Before High-Odds "Go"
07/13/04 8:00pm EST
The Dow has gone 103 days with hitting a
new yearly high or low. While lengthy, there have been many
streaks which have gone longer. Precedent suggests we could have
several more months before such an extreme is reached. Also, a
look at tomorrow's unusually positive seasonality, and the dip in
bullishness in the lowrisk.com survey.
Some Good Signs, But Still No Confluence
07/08/04 8:20pm EST
OEX traders, who are adequate market
timers, have begun to concentrate more on calls once again. Also,
the Rydex Beta Chase Index, which tipped us off to excessive speculation
near the highs, is back to more normal readings.
Approach to Lower End of Range Should Set Up Longs
07/06/04 8:30pm EST
There has been a very distinct correlation
between program trading and the weekly range in the S&P 5000 index, and
there appear to be no signs of that letting up. Also, we're once
again seeing some unusual readings in the TRIN, which have had
historically interesting results.
Sentiment, Price and Volume all Point to Continued Range
07/01/04 9:00pm EST
Our Rydex Beta Chase Index is showing an
incredible preference for risk-taking from this group of wrong-way
traders, which is never a good sign. Also, we look at the impact
on volume of program trading, and note that ETF volume has dried up,
also not a positive sign. Lastly, we look at past reactions to
Federal Reserve rate decisions.
Continuing to be Wary of Breakouts
06/28/04 9:15pm EST
Looking at the total dollar value of
commitments among large and small traders in all of the major index
futures contracts, we can get a better idea of their market outlooks.
The past year has been relatively difficult to decipher, but recently
positions became more bearish than they have been in some time.
Lower Prices, More Optimism
06/24/04 8:20pm EST
Respondents to the lowrisk.com sentiment
survey are more bullish now than they were when prices were higher,
after having never really become bearish at the May low. Also, a
look at how the market has performed in the past after implied
volatility reached a new yearly low, with and without a confirming
yearly high in the S&P 500.
A Mixing Bowl of Readings
06/22/04 8:00pm EST
The past performance of the S&P 500 after
extremely high SPX put/call ratios is positive, but it is at least
partially due to a huge increase in put open interest. Also, a
refresher table showing market performance after various tiers of
bullish opinion.
Seasonal Pattern is Not Helpful (for bulls)
06/17/04 10:15pm EST
An analysis of the Seasonality Index that
is posted daily to the site shows that bulls may have it tougher than
usual for the next couple of months. Also, we should keep our eyes
on call open interest in OEX options, as it is showing a potentially
bearish development.
Short-term Edge Remains Elusive
06/15/04 8:30pm EST
Today's huge rally in the long bond, while
impressive, does not necessarily bode anything in particular for
equities, at least according to history. Also, OEX traders have
been gearing up their concentration in put option contracts, which is
not usually a positive sign.
Back Near Top of the Range
06/13/04 9:45am EST
An analysis of asset shifts by Rydex
traders shows a clear dislike of leisure and basic materials stocks, but
lots of love for consumer products, even though most have not broken out
of their ranges. Similar to a setup shown in May, it may lead to a
possible spread trade between the sectors.
Still More Confirmation
06/07/04 8:30pm EST
A detailed analysis of all option volume
from the major exchanges shows that the recent historically high
put/call ratio are not an anomaly due to some exotic strategy - traders
have simply been preferring put strategies over call strategies, and
that has bullish implications. Also, a look back at market
performance surrounding past market closings for Presidential
ceremonies.
Focusing in on Oscillators
06/03/04 9:00pm EST
The exceedingly high number of neutral
respondents from several of the sentiment surveys suggest that we may be
most likely headed for a large trading range environment where
oscillating-type indicators may work better than trend-following
breakout strategies.
Short-term Looking Dubious, if No Relief Buying
05/30/04 11:50am EST
The increasing influence of program trading
has likely at least temporarily destroyed the effectiveness of the
Specialist Short Ratio as a sentiment gauge. Also, the recent
enthusiasm displayed by Rydex traders is a sign that the prospects for
upside in the short-term are limited.
THAT is What We Needed
05/26/04 8:30pm EST
The McClellan Oscillator has gone from its
2nd-most oversold in 64 years to its most overbought, which has nearly
always preceded long-term rallies. However, on an adjusted basis
we are far from the most overbought. Also, a look at option market
activity and typical market behavior around Memorial Day.
Some Mildly Positive Signs, and One Bad One
05/24/04 7:50pm EST
Our ROBO put/call ratio has ticked up to
the highest level in many months, but remains below the panic level seen
at the bear-market lows. Also, we look at available cash sitting
in NYSE-designation clearing firms, and how the market has usually
responded when going from grossly oversold to overbought.
Expiration Calm
05/20/04 6:20pm EST
Exceedingly low volatile days preceding
option expirations in the past have lead to a positive expiration day 9
out of 11 times, with an average range of 10 points. This suggests
we may have a little headwind to the upside for Friday's expiration.
Flees to ETF Liquidity in Times of Uncertainty
05/18/04 7:20pm EST
Similar to what we saw with SPY/S&P 500,
excess volume flowing into QQQ over and above its component stocks tends
to coincide well with market lows, while low volume often accompanies
market peaks. Also, the OEX Determination Index shows OEX traders
are becoming fairly aggressive in obtaining long-side exposure.
Extremes After an Historic Run
05/16/04 10:15am EST
In its 100+ year history, after periods of
extreme price persistency, like we saw in 2003, the Dow did not roll
back over into a new bear market. Instead, it suffered a mild
correction, then went on to further gains. Also, a look at the
effect of interest rates on breadth figures, and the meaning of ETF
volume being significantly different from that of the underlying stocks.
A Different Look at Volatility
05/12/04 7:45pm EST
The volatility we've seen in the
advance/decline breadth measurement has been equaled only a few other
times in history - every one showing a higher market 90 days later.
We are also seeing historic readings in the CBOE put/call ratio.
After similar instances, the market did not bottom immediately, but it
did soon thereafter.
A Quick, Unscheduled Note
05/10/04 7:32pm EST
We have seen many records or near-records
the past few days, and this comment highlights some of them, such as the
McClellan Oscillator and our TICK readings.
Breadth Inspection
05/09/04 11:00am EST
New lows on the NYSE as a percentage of
total stocks traded is at an historic extreme. Every other
instance in the past 20 years has resulted in a major market low.
Also, we look at days when declining issues were 12 times advancing
issues, with similar conclusions to the new lows study.
Sector Rotation at Rydex
05/05/04 8:45pm EST
Asset rotation among the various Rydex
funds may give us a clue as to which broad sectors are most/least likely
to outperform.
Big-Money Bulls
05/03/04 8:30pm EST
Barron's magazine is showing a very
low number of bullish respondents in its semi-annual poll, which is not
necessarily a good sign. Also, we look at market performance after
the Nasdaq first crosses below its 200-day average, and market reactions
after Fed meetings.
New Lows as a Warning Sign
04/29/04 7:45pm EST
New lows on the NYSE have exceeded new
highs on a 10-day moving average basis. While it sounds ominous,
historically this has been a good contrary indicator, meaning it more
often lead to gains than losses. Also, we look at the STEM.MR
model for the Nasdaq, which hit a new record high.
Omen, or "Oh, Man!"?
04/27/04 10:45pm EST
The Hindenburg Omen does not consistently predict dire
circumstances for the market. Also, we look at our short-term STEM
model and past occurrences of perfectly neutral indicator scores.
A Link from Metals to Bonds to Stocks
04/25/04 10:20am EST
There is a relatively consistent link
between the precious metals and bond markets, and between the bond
market and stocks. We look at how futures traders are positioned
in the metals, and how it may affect the other markets. Also, an
update on our bond market sentiment indicator score.
The Survey Says...Neutral!
04/20/04 9:30pm EST
Recent readings from the lowrisk and
Investor's Intelligence surveys show an excessive number of neutral
responses, which in the past lead to choppy market conditions going
forward. Also, a deeply oversold cumulative TICK indicator
suggests the market should rally here, or it is a sign we are due for a
deeper correction.
Doing What It Needs To
04/18/04 9:50am EST
So far the broader market is doing what it
needs to in order to keep the uptrend intact. Also, a look at the
week after tax day since its origin in 1914, and a review of each of our
sentiment indicators for the bond market.
Inflection Point
04/14/04 8:00pm EST
The severe selling pressure over the past
couple of days historically has lead to a negative market in the
intermediate-term if the following day was negative, but a positive
market if the day after was positive. Coupled with readings from
some of our other measures, the next few days may prove important.
Real Estate Woes?
04/12/04 8:55pm EST
The action in Real Estate Investment Trusts
over the past few days, down over 10% from new all-time highs, has been
seen three other times since 1971. All lead to lower markets, and
two of them lead to imminent waterfall declines. Also, a look at
mutual fund inflows.
Low Behavior
04/04/04 8:00pm EST
The readings we saw from many of our
studies in March, and the subsequent market action, suggests that the
odds are very high we have seen an intermediate-term low. Also
discussed is the impact on banks of rising rates, the theory of
"accumulation" days and Easter proclivities.
A Surprise Should Set the Tone
04/01/04 7:45pm EST
A surprise in the jobs report should set the
tone in the short-term, though beware that the market has usually traded
in the opposite direction of the surprise after 20 days. There are
reasons to be bullish here, but please don't include the put/call ratios
among them.
TRIN Switch Looks Good in the Long-Term
03/30/04 8:45pm EST
The recent switch in extremes in a 5-day average of
the NYSE TRIN is historically rare and quite positive in the long-term.
Also, a Presidential election year phenomenon.
Breadth Says Up, Sentiment Says Down
03/28/04 9:30am EST
Our breadth research suggests the highest odds are
with the upside over the intermediate-term, but our pure sentiment
measures still show a lack of fear from those who should most be showing
it.
Getting There
03/24/04 11:33pm EST
Looking at several metrics, we see that traders in the
Rydex Electronics fund, which follows semi stocks, are about as
pessimistic now than at any time in the past few years.
Longs Called Into Question
03/22/04 8:45pm EST
Signs of excessive selling pressure are there
(witness the historic TRIN readings), yet small options traders continue
to show no fear.
Volatility
03/18/04 9:00pm EST
We have seen nearly unprecedented movement in
the VXO volatility index over the past week. Historically, such
extreme flip-flops have been a positive for the market after some
initial confusion.
Puts 1, Calls 0
03/16/04 8:45pm EST
There is a precedent for recent TRIN readings
near the high after a major bull move. While it is tenuous to draw
too much from such examples, this lone precedent suggests that any
additional downside would be a buying opportunity. That coincides
with recent options market activity.
Drops, Pops, Streaks and Flips
03/14/04 10:30am EST
Extreme flip-flops in breadth and volatility
measurements - while not precluding some short-term weakness - have lead
to higher prices over the intermediate-term with very high levels of
consistency.
Downside Should be Minimal
03/10/04 9:05pm EST
Our two short-term "composite" measures - the
indicator score and STEM.MR model - are giving readings typically seen
only near market low points.
Performance After Payrolls
03/04/04 8:35pm EST
Large disappointments in the payroll report
have recently lead to short-term declines, but after 20 days the market
was higher a majority of the time.
How Now, Dow?
03/02/04 10:00pm EST
The Dow has now logged 191 consecutive days
at least 5% above its 200-day average. History suggests that this
type of trend persistency tends to keep going, and is consistently a
bullish factor up to a year later.
Distribution Days and Fund Flows
02/29/04 9:40am EST
The market has not done anything technically
wrong according to this definition of "bad" days. Also, mutual funds
had near-record inflows in January - according to one measure at least.
"End-month, New-month" Pattern
02/25/04 8:30pm EST
The next five days historically have been
very positive for the market, equating to a 37% annual return. Also,
assets following semi stocks are at a level that has coincided with
rallies over the past year.
Cash Isn't King
02/23/04 8:15pm EST
Mutual fund cash levels are low, but so is
the yield on cash equivalents. Adjusted for interest rates, current
cash levels are about where you should expect them to be.
TRIN Reading Suggests a Bounce
02/19/04 8:20pm EST
The day after option expiration tends to have
a negative bias, but the selling we have seen suggests any additional
downside may be limited.
Still Waiting for a Longer-term Edge
02/17/04 9:00pm EST
Today's equity p/c ratio signaled that we may
see more of a bounce, but it is likely compromised by expiration.
As Much Edge as a Soccer Ball
02/12/04 8:20pm EST
Rydex traders have shifted their assets to a
point where they are as bullish as they were when the S&P was 100 points
higher and the NDX was 1000 points higher.
Long-Term Positives
02/10/04 8:30pm EST
Despite the many negative indications from
some of our sentiment work, there are some positives such as margin debt
and specialist shorting activity.
VIX Predicts
Cloudy Skies
02/08/04 10:45am EST
Using regression analysis, changes in the VIX over the
past 90 days has a good record at forecasting S&P changes 90 days in the
future. Currently, the forecast is suggesting significant upside is
unlikely.
Beginning to
Look Long for a Trade
02/04/04 9:00pm EST
We're extremely oversold in the short-term, and this
is one reason we are now concentrating on the long side, particularly in
Nasdaq issues.
Still Looking
for a Range
02/02/04 8:53pm EST
February has not shown much of a bias historically,
and the year of a Presidential election is typically choppy for the first
five months or so.
Reversals,
Streaks & Excesses
01/29/04 7:20pm EST
We recently ended a streak of the NYSE not having a
lopsided selling day in over two months. Historically, the end of
the streak has actually been a positive event.
Looking to Play
the Range
01/27/04 8:00pm EST
When properly adjusted for consistent and notable
seasonal influences, short interest in Nasdaq shares is higher than
average.
Betting Against
the Big Guns
01/25/04 8:30am EST
Large commercial traders in the full S&P 500 futures
contract are now net long. Historically, that has been a very
positive indication for future market performance.
A Rose is Not
Necessarily A Rose
01/21/04 10:20pm EST
Consecutive days without a 1% down day is a little
misleading. Still, even after adjusting for volatility and
sentiment, history says we may not be through with our current streak.
It's Now or,
Well...Later
01/18/04 11:46am EST
A confluence of factors coming together suggest that
the most likely time for a decline to begin is early next week.
Merger Mania
Redux?
01/14/04 9:00pm EST
The history of big mergers shows that after a short
honeymoon period, the broader market has generally declined afterwards.
Ready, AIM...
01/12/04 9:00pm EST
The AIM model of advisor and investor opinion is
giving its most overbought reading in 17 years.
Volume Spike
01/08/04 10:00pm EST
Huge spikes in volume on the NYSE and Nasdaq, such as
we've just seen, normally come near the end of major moves.
January
Corrections
01/06/04 9:05pm EST
Since 1985, the NDX has undergone at least a 5%
correction 83% of the time, usually beginning in the first half of the
month.
"Score" One for
the Bears
01/04/04 11:00am EST
Our intermediate-term indicator score is at its lowest
point in 4 years, suggesting additional short-term upside should be viewed
with suspicion.
top of page
