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For Monday, April 28, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.03/0.72
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Options Tip Market Decline

The market is now more likely to be on the verge of a waterfall decline substantially below last year's lows than at any point since last October.

As we mentioned in the last update, the tremendous betting on the downside in the NASDAQ-100 options arena was a great indicator of the decline getting warmed up in the wings Thursday. Ostensibly, the selloff was due to the SARS virus or the GDP Report, but we know what it was really due to. We discuss this and quite a few other topics in this weekend's Detailed Comments Page . . . . http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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For Friday, April 25, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.20/0.45
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Critical Turning Point At Hand

Thursday saw a standoff between the bulls and the bears. Our dollar-weighted option sentiment figures showed the extent of the battle as the QQQ players switched to the bearish side. After being heavily into calls for the last week — and correct on further rally — QQQ put volume soared to three times that of OEX put volume Thursday and more than twice that of QQQ call volume. It was certainly an unprecedented display of betting on the put side of the equation.

This may or may not be a sign of a top in place in the market. That's because we have a relatively limited history for the QQQ options series. But, even so, that limited history says that when dollar volume in the QQQ soars well above that of the OEX dollar volume — and twice as much money was transacted in QQQ calls and puts compared to OEX calls and puts Thursday — it has marked an important turning point: a trading low, high or acceleration point. The OEX traders are consistently wrong at turns, but the QQQ traders are consistently right at turns (we think that's because they are front-running their own program trading). For most of Thursday, the OEX crowd bought calls on the dip, a strongly bearish indicator, but not an outright sell signal. An outright sell signal on OEX would have twice as much money going into calls as puts. By the close they still leaned toward the call side, but didn't register an official sell signal. Thus, the OEX indicator has not yet spoken with a sell signal on this rally.

The price pattern seems to argue that a sideways pattern here could setup one more rally to new highs. Money Flow continues to be stronger in the broad market compared to the blue chips, a very bullish indicator, making it impossible to rule out the possibility of a breakout on the upside. And, the blue chip S&P 500 Index may need to put in a higher high while diverging bearishly on its 20-Day Bollinger Band before turning down (it pulled back from its Wednesday foray into the 50-Day Band — often, a market will attempt to move back into that 50-Day Band and fail, signaling a final top). The NASDAQ-100 may have completed a double top by the close Thursday, however. We expect this, our lead dog index, to turn as much as 2-3 days ahead of the S&Ps, so its action Friday could be a key indicator telegraphing whether this is the end of the rally or just a pause before a breakout to the upside.

If this March-April rally is another corrective Elliott abc rally within the long 9-month contracting triangle, we would need one more wave higher (not necessarily to a higher high, though) to complete the pattern and usher in a waterfall decline to a possible new price low for the bear market. The risk-reward equation thus argues that being long stocks is a dangerous position at the moment. If there ever were a time to keep the powder dry, this is it. Volatility is very low. Periods of low volatility are just the eye of the hurricane, as they precede large increases in volatility.

As you know, time cycles and the Bradley Calendar argue for a trend change, nominally a low, right now, and a sharp rally into June-July. But, given the overbought condition in the market, that trend change is just as likely to be to the downside as to the upside. We should see the market tip its hand very shortly.

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For Thursday, April 24, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.11/1.43
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Heavy call buying in the QQQ options last week and earlier this week tipped that we would see further strength in the market. And that heavy call dollar-volume continues in that area as we moved over the midweek hump and slid toward the end of the week Wednesday. The OEX traders have not yet gotten overly-bullish — a ratio of dollar-weighted call to put volume of 2:1 or better — so no sentimental sell signal has been given.

We have a cyclic and Bradley turning point due either Thursday or Friday, although one must always remember than projected turning points have to be confirmed by coincident indicators at all times. The turning point could be a point of acceleration as well as a high or low. And, one of the best coincident indicators is sentiment, which needs to get frothy with emotion to confirm a turn.

We also have to keep an open mind about the turn: those two indicators are calling for a bottom and although the market has not shown great technical strength, a breakout from the trading range could send the market soaring on short covering. At this point we're keeping an open mind and cash at the ready (we cashed in our profits on the spread position Wednesday as the signal line was briefly broken intraday).

In fact, we think the NASDAQ-100 should be leading the way higher if this is indeed a breakout to the upside. That it has been relatively weak is another reason to be cautious. As the market is in now in the neighborhood of all intermediate tops of the last 9 months at the present time, patience in taking a position is likely to be rewarded.

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For Wednesday, April 23, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.70/0.72
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Hooking the Bears

The market did a little head fake down Tuesday morning, enticing the bears to buy a few puts and then took off to the upside, with the S&P 500 ending right at 911.38. With a top due later this week (Thursday or Friday is our best estimate), the bulls obviously had a little fun in store for the short sellers for now.

But, while the OEX crowd turned bullish — and bought call options heavily for the rest of the day — the QQQ crowd was heavily biased to the put side. By the close, volume in QQQ put options was 137% of volume on OEX puts. Usually, this large a volume of QQQ puts is a sign of hedge fund positioning for a coming decline.

The NASDAQ-100 did not take the lead on the rally, which is a tell-tale sign that a market top is nigh. Our favored spread — long the June NASDAQ-100 emini and short the June S&P 500 emini — barely budged all day as our signal line grew ever closer to a sell.

However, despite initial weakness, the Semiconductor Index (SOX), which leads even our lead-dog NASDAQ-100 Index (NDX), has not yet faltered and a drop in its relative performance will likely be the telltale sign of a top in the making.

Money is flowing out of the NASDAQ-100 Index stocks and into the S&P 500 stocks. If this continues, we'll be taking profits on our preferred spread, but not initiating a new position until we see the reverse spread showing stronger signs. We would prefer to see the NASDAQ continue to lead because that is an argument in favor of a bull market starting in the next month or so (although from lower levels). If NASDAQ continues to falter, it may be a sign of a much stronger declining phase building pressure — as in a plunge to the bottom of the 9-month trading range, or below.

Key technical indicators continue to deteriorate here. Watching this market on the technical gauges makes it feel like being in the cockpit of an large airplane whose engines are running full bore, but with those gauges flashing red warnings that the plane is reaching a stall condition. The price pattern of the rally is a classic a-b-c, corrective rally, and that isn't bullish for a breakout of this trading range.

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For Tuesday, April 22, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.11/1.81
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The market digested last week's gains Monday and appears more likely to have a bit of upside potential remaining into the turning point due this week. The Semiconductor Sector remained relatively strong and it tends to lead the rest of the market. Our favored spread now — long NASDAQ-100 and short S&P 500 — treaded water most of the day as our signal line started closing the gap (see the SpreadWatch chart links for details). The spread contract value and its signal line were still separated by over $500 after the close Monday, so the potential for the trend higher to continue remains alive in that indicator. It is possible for the market to decline while the spread continues to gain value — that's exactly the pattern we saw in September as the market plunged toward its mid-October lows.

To clarify a point we made about the small speculators: the large speculators are substantially short (as of last Tuesday's close, according to the Commitment of Traders Report), while small speculators are overwhelmingly long. The small speculators are not only wrong at turns, they are mostly wrong anytime, while the opposite is the case for large speculators. The commercials, who are now modestly long the market in the big S&P 500 contract tend to be months early in their positioning. For instance, they moved to a net short position in 1999 about six months before the bull market peaked. So, those folks who are turning bullish based upon the more bullish positions shown by the commercials must have a great deal of patience.

OEX speculators also tend to be wrong at turns. Monday's profit-taking turned them slightly bearish — although, by the close, they had regained a bit of confidence and bought calls. This is a sign that the rally probably has more to go this week. If the top were in place, these players would likely have bought more calls on the initial dip. Confirming that view, the QQQ speculators are very bullish now as they are probably positioning for one more program trading rally.

Seasonal strength could carry the market higher this week into the turning point due Thursday or Friday. As well, the US Dollar Index is due for a rally into a Time Ratio High due, ideally, on Wednesday. Strength in the US Dollar tends to coincide with strength in equities.

Overall, intermediate term technical indicators remain extremely toppy and the risk of a sharp fall here is great for equity investors. Time cycles and the Bradley say a turning point is due this week, but that turning point is looking more and more likely to be a top rather than a bottom.

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Format for printing. [Go back]

For Monday, April 21, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.52/1.24
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Good News/Bad News

The good news is that the monthly market manipulation by options sellers is over now. The bad news, for the bulls at least, is that they'll be back next month.

The manipulators rallied the market to expire the maximum number of put and call options as worthless as they possibly could. The maximum pain point for QQQ option buyers was $26 and they overshot that goal by 82¢.

Now that options expiration is over, this puffed-up market is free to resume its natural trend. As long as the S&P 500 Index continues to obey the dictates of that falling resistance line (now at 901.16 on the daily chart), it's reasonable to assume risk on the downside is — at a minimum — 771.19 by the end of June. That's where the lower channel line comes into play.

However, a move above resistance could lead to a short-covering panic near term, with a target on the upside of 1117.03, the upper channel line.

The battle lines are tightly drawn as far as bulls and bears are concerned. But, directionality is pretty much irrelevant at this point. That's because we've been making money without caring whether the market zooms, crashes or simply muddles through as you will find by reading our Detailed Comments Page . . . . http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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For Friday, April 18, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.52/1.24
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Good Thursday

The stock market closed out the week on an upnote as options expired. Normally, options expire on the third Friday of each month. This month, however, the third Friday falls on Good Friday, a market holiday, so Thursday was the last trading day for April options.

That sea change in the market's relative strength we've been looking forward to has occured. We're talking about a shift out of the blue chips and into the NASDAQ. If you're following our SpreadWatch chart, updated intraday on the website, you know that the NASDAQ-100's relative performance has been zooming higher than the S&P 500's for the last two days. Since we've been looking for this to happen as a prelude to a rally in the market, this is a longer term bullish development, but doesn't preclude the possibility of a steep selloff in the market going into that next bull run for the broad market.

It does, however, present an excellent profit opportunity while we wait for that bull run to get going. We'll discuss this and other topics in this weekend's update for subscribers on Saturday.

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Format for printing. [Go back]

For Thursday, April 17, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.50/0.91
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Tale of Two Markets

The NASDAQ rose slightly Wednesday, but the broad market tumbled, as investors reacted to better than expected earnings from the tech sector.

The rally got started on Tuesday evening as the NASDAQ-100 emini futures soared and the S&P 500 emini futures tagged along for the ride. If you watched the intraday chart of the spread between those two (plotted as the difference between the S&Ps and the NASDAQ), it dropped sharply lower on good news for the tech sector. As we've been saying, we do expect the NASDAQ to outperform the blue chips ahead of the actual market low. That may have started late Tuesday. However, remember that the NASDAQ outperformed the S&Ps for a full four weeks ahead of the October low — and both indices tracked lower during that entire four weeks, so this is not a sign that the market is about to zoom higher.

In fact, there are many reasons to expect weakness — a thrust decline to lows below the October lows is entirely possible — in the coming days. Refer to the Weekly Charts section of the website and take a look at the "MID S&P MidCap Index" chart for the clearest Elliott Wave count that supports a thrust decline to lower lows. However, if the NASDAQ-100 can continue to outperform and the June spread can navigate across its 20-day moving average successfully, we would be looking to buy the spread which favors the NASDAQ (here we're referring to the daily spread chart which shows the value of the June NASDAQ-100 emini contract minus the June S&P 500 emini contract in the Daily Spreads Charts section of the website as "NQ June 2003 NASDAQ 100 e-mini - ES June 2003 S&P 500 e-mini Spread").

We also want to watch the intraday spread chart, which is shown on the main webpage just above the Relative Strength table as "SpreadWatch: June 2003 ES-NQ: 1578.00" — 1578.00 is the link to the intraday chart and is the 10-minute delayed value of the spread. Our experimental trading signal line, shown in red, should not be intersected by the white price line — since this chart shows the inverse spread, we want to see that white line trending lower.

The option manipulators did a great job of moving prices right where they needed them on Wednesday. The maximum pain theory target — the price at which the pain of option buyers will be maximized — says that they need to close the April QQQ options at $26. The close Wednesday was $26.21 (close enough for option work). Nice job, guys! If you ever blow out as traders, you have a great future in parking lots.

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Format for printing. [Go back]

For Wednesday, April 16, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.70/1.19
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Almost a Sell Signal

Our intraday OEX sentiment gauge almost triggered an outright sell signal on the close Tuesday as traders poured 70% more money into upside bets as compared to downside ones. We consider a ratio of 2.00 or higher (i.e., a point where twice as much money is going into bullish bets) as a sell signal on this indicator (we never use just one indicator, so a sell signal on one doesn't necessarily coincide with sell signals on others — it's the confluence of sell signals that triggers a trade).

At the same time, the VIX indicator reached its lowest levels since June 2002. This indicator measures the fear factor in OEX options. The very low reading of 25.95 indicates a tremendous level of complacency in the market — and suggests the possibility of a market poised to leap off a cliff, rather than soar above it.

However, the NASDAQ-100 continues to outperform the S&P 500 Index very slightly, causing the spread we took so much short term profit in last week to give back some ground. After the close, the spread rallied as it has in recent days, but overall has made no net progress this week. This suggests to us a stalling out of the trend. There may be one more push up when the market sells off into the cycle low (assuming there will be a cycle low next week, as the schedule calls for). However, since this spread tends to lead turns in the market, it's getting late to be playing this direction (long SPX - short NDX). If we are going to see the market ``fall off a cliff'' soon, we should see the NASDAQ-100 start to take the lead from the S&P 500 Index. That will be a leading indicator that a bottom is near.

On the other hand, if the SPX-NDX spread pushes back above the upper blue band in the daily chart (i.e., into the orange outer band), it would indicate that a very strong decline in the overall market may be at hand, since that would only occur when money would flow out of the NASDAQ and into the relative safety of the blue chips. We should not have too much longer to wait to see which it will be.

The US Dollar Index is still a wild card in the equation. Recent weakness in the dollar has kept foreigners from buying US stocks. The short term decline has clearly not ended yet and, on the very short term intraday chart, you can see that a triangular trading range has developed. Since these kinds of patterns are continuation patterns, the preceding downtrend should reassert itself soon. That can't help US stocks in the short run.

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Format for printing. [Go back]

For Tuesday, April 15, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.01/3.03
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The OEX pit was, once again Monday, sitting on the fence with an equal number of bulls and bears. Not so in the QQQs (NASDAQ). They bought calls near the close Monday in heavy numbers, suggesting that they may be planning a run back to last week's highs. Yes, options expire on Thursday, a day early due to the holiday. And the manipulators are back in force.

Volume was very low Monday, suggesting the option players may be having an easier time manipulating the market with the low interest from both bulls and bears. Or, perhaps, everyone was off doing their income tax returns?

The very low volume was matched by a very low VIX reading as it dipped just below the level it reached at January's low — which just happened to coincide with January's top price level on the indices.

All this suggests that this market remains dangerous for both bulls and bears. If the levitators keep prices up artificially this week, next week should be quite volatile on the downside.

Our decision to take profits in the SPX-NDX spread we had last week turned out to be good as that spread seems to have entered a go-nowhere trading range, much like the market indices themselves. If you've been watching the intraday chart of the spread, you may have noticed that red trendline is now an indicator line. We're working out the details of a trading system, so just ignore the squiggles of the chart for now. We do think that a move over the 20-day moving average in the daily spread chart would be a sign that the spread had entered a bullish phase (here, we're speaking of the reverse spread where NDX is held long and SPX held short). A bullish NDX-SPX spread would also be a leading indicator that the broad market is nearing a bullish phase as well. Remember, however, that this indicator can lead the broad market by several weeks.

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Format for printing. [Go back]

For Monday, April 14, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.00/1.45
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: A Tale of Two Kinds of Indicators

We cashed in our profits in the spread trade Friday for a nice profit and are awaiting another entry point next week. A move over the 20-day moving average in the June 2003 NASDAQ-100 - S&P 500 emini spread would trigger a buy signal for us.

We, from time to time, emphasize a very important distinction when it comes to the two kinds of indicators we use to analyze the market:

  1. Forecasting Indicators project highs, lows and trending moves in the future.

  2. Coincident Indicators tell us what the market is doing now, not in the future.

When the coincident indicators align with the forecasting indicators, higher confidence levels in investment positions result. But, when those indicators disagree, a great deal of caution is called for.

What are the indicators saying right now — and do they agree or disagree? That's exactly what we discuss in this weekend's Detailed Comments Page . . . . http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://www.marketclues.net/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Friday, April 11, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.00/0.71
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://www.marketclues.net/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

The market stopped going down Thursday, although it appears to be more a brief intermission and not a reversal to the upside. The stock market has been mired in a trading range for the past 9 months and appears to have no directional bias anymore. Perhaps it's just earnings season, but the market looks pretty trendless to us. It may just be nervous exhaustion, but the low volatility readings and lack of discernable economic growth is probably setting up an exposive run to the upside — once the market does find a direction.

We have a Time Ratio Low due soon, along with a time cycle low and the Bradley Calendar low. It will be particularly bullish if the market can hold above recent low prices and would argue that a very substantial rally is building pressure for release late this month and lasting into early boreal Summer. We will discuss details for this expected low cluster in this weekend's detailed comments.

Our recommended spread trade — long the S&P 500 and short the NASDAQ-100 — dipped down to just kiss the red support line Thursday, but maintained a slight upward bias into the day session close. We intend to take profits off the table on a break of that support line and will be looking to enter the opposite spread trade should the 20-day moving average be broken.

In this weekend's update, we will start looking at stocks which are holding up stronger than the market. In the very last stages of a bear trend, the new leaders can be found by examining those stocks which decline less than the market. So, we'll be looking to buy those new leaders in the near future. We want to be patient about buying, however, because those new leaders often will sell off hard in the final ``give-up'' stage of the decline.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Thursday, April 10, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.84/3.54
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://www.marketclues.net/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
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Stocks: Fear of Falling

The statue of Saddam Hussein came tumbling down Wednesday — along with stocks as the market refocused on the still-tumbling economy. Wild trading near the opening sent the market gyrating wildly, but the direction of our spread trade trended higher all day.

We should probably explain just how to calculate the value of a spread since we were asked that question in an email today. We'll use the June S&P 500 emini (symbol ES will stand for the current quote on that contract) and the June NASDAQ-100 emini (symbol NQ) in this example.

This spread consists of two legs: the long side (ES) and the short side (NQ) in the current position. A minimal position consists of one ES contract and two NQ contracts for this combination of contracts (the exchange determines this). To calculate the current value of the spread, you have to convert the current quote into a contract value in dollars.

Contract value = number_of_contracts × current_quote × dollars_per_point.

For ES, dollars_per_point is $50. For NQ, dollars_per_point is $20. Now, we're ready to calculate the value of the spread:

Let's say the current quote for ES is 866.75 and the current quote for NQ is 1026.

The long leg of the spread = 1 × 866.75 × $50 = $43337.50.

The short leg = 2 × 1026 × $20 = $41040.

The final step in the calculation is to subtract the short side from the long side = $43337.50 - 41040 = $2297.50.

The spread value continues to trend up, indicating the overall market direction is down. Again, we're looking to take profits when the spread value drops below the red support line shown in the quarter-hourly chart (click on the spread value shown on the main webpage to display the intraday spread chart and that support line). We are also looking for a reversal across the 20-day moving average on the daily chart to signal that the market is bottoming and turning up. That will be our signal to initiate a long NQ - short ES position for the next rally in the stock market.

We will also be looking to buy stocks which maintain a relatively strong price in the face of this downdraft. We'll be looking at buy candidates a bit later on.

Note: the DSL line seems to be stable and we're leaving the links in this email pointing to it. However, the alternate link shown above (clues.dhs.org) can, as always, be used as a fallback.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Wednesday, April 9, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.20/2.42
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: Idling

The market went virtually nowhere Tuesday as the previous days' failed rally saw no follow-thru to the downside. Sentiment continued to be too bullish as option buyers saw the dip as a buying opportunity — not a good sign for the bulls.

The pattern could be a diagonal triangle, a five-wave Elliott structure such as we've been looking for in this rally, but the very weakest one of all possible five-wave rallies. If that's the case, we could have another relative new high this week before the whole pattern collapses back on itself and retests its base around the mid-March lows of SPX 789 and Dow 7400.

News has been moving the market. True, but not in any trendable way. The latest news on the war sent futures up before the cash market opened Tuesday morning, but, perhaps because of the failed rally Monday, buyers just weren't hooked. ``Once burned, twice shy,'' as they say. Our recommended spread maintained a positive bias, but a tightened stop to take profits along the red support line in the intraday (quarter-hourly) spread chart seems like a good idea. And, we do have nice profits on this trade. The SPX has been considerably stronger than the NDX and that has made us money on the spread. We wouldn't switch to the opposite spread unless we get a good move across the moving average in the daily chart. Even if the whole market sells off, we could get a signal to switch to the reverse spread (long NDX, short SPX), which would be strong sign of a bottom forming. In fact, a collapse out of the pattern down to retest the mid-March lows would be a great setup for a strong rally into boreal summer, something both the Bradley Calendar and our time cycle predictor are calling for. Time cycle projections are updated from time to time in the Special Report section of the main web page.

Format for printing. [Go back]

For Tuesday, April 8, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.73/0.61
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: Waterfall Decline

The US Dollar Index topped exactly where we expected it to Monday morning and provided the grease for the skids the stock market hit. A waterfall decline started right after the pop fly short covering rally ended. Sentiment hit overly-bullish on the intraday OEX gauge to tell us it was a top and not a breakout move in the early going.

Our recommended spread trade is performing well: five Elliott waves up, followed by three waves down, then up again. By the end of the day, it was off a few bucks from Friday, but on an upward trend again. Use a trailing stop loss order to take profits in this trade. We'll be looking for a break of the middle Bollinger trading band — see the ma label on the daily spread chart for this trade available under the Daily Spreads Charts Menu as "ES June 2003 S&P; 500 e-mini - NQ June 2003 NASDAQ 100 e-mini Spread" — as a signal to get long the opposite spread, the June NASDAQ-100/S&P 500 emini spread, in anticipation of the next stock market bottom. That will be our signal that the market is revving up for a great stock market rally into boreal summertime. Getting into a spread ahead of the bottom should be mildly profitable (but, never any guarantee of profits) and allow us to "ride the choppy seas" while navigating the next stock market low.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Monday, April 7, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.40/0.87
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: Intermission Over

The brief intermission rally within the downtrend rejuvenated bullish feelings last week, but is probably over in the NASDAQ and virtually over in the blue chips.

The two-day rally saw the NASDAQ-100 outperform the S&P 500, but that strength dissipated on Friday as the relative strength chart on the website shows. Typically, NDX will outperform SPX in the last stages of a market decline. For instance, in the four weeks before the October 2002 price lows, NDX went down less than SPX. Virtually all sustainable rallies over the past decade have been preceded by strength in NDX relative to SPX. When a rally suddenly appears like last week's with no tipoff from NDX, you have to be very suspicious of its staying power.

With the sudden weakness in NDX Friday, it appears that the rally in NASDAQ is over. The SPX may not be far behind, although a brief spike early Monday morning (possibly limited to European market hours) may occur on last gasp strength in the US Dollar Index.

We discuss this and other topics in this weekend's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Friday, April 4, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.09/1.27
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

AOL Users: You Haven't Got Mail!
Due to AOL's new policy of not accepting email from certain senders, we are changing the way we send out all email with today's update. We are sending this note from a different location in hopes of confusing them.

Stocks: Consolidation Day

The market gyrated around unchanged for most of the day Thursday as no substantial follow-through was evident from Wednesday's surge. However, there was a pickup in money flowing into NASDAQ. If that pattern continues, we may be seeing a sea change similar to the one which occured in September four weeks before the actual market price bottom in October. Although the market itself is likely to top out Friday (the top could potentially stretch into early next week) and head down into late April, a pattern of NASDAQ outperformance on the slide would be longer term bullish.

So far, the rally has been very disappointing for a wave c. The prior wave a lasted eight trading days and covered a lot more price ground. Perhaps one of the factors which has held the market back has been the US Dollar Index, which rallied Wednesday, but sputtered on Thursday. In terms of Elliott Waves, the stock market appears to have completed a five-wave up pattern near the close Thursday. That's the minimum pattern we would expect to see in a wave c and thus the entire rally may have finished on Thursday before the close.

In any case, the market continues on edge based upon news from the front as the coalition prepares for house-to-house combat in the streets of Baghdad.

An interesting pattern in the TRIN indicator (Arms' Index), first noticed by Steve Dixon and posted on the GMSTechStreet.com Discussion Forum, has been that when it closes below 0.40 and stayed below 0.85 intraday the entire day, the market has been on the verge of sharp selloffs. This has happened 8 times prior to Wednesday and each time the market has sold off substantially in the next few days. It happened on Wednesday as well for the 9th time. Prior occurences, with subsequent S&P 500 point moves, were:

Steve calls this indicator SoopaLowTrin. It occurs when there is a buying panic where fund managers are scrambling to chase a rally, but there is no followthru buying thereafter, creating a buying vacuum.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Thursday, April 3, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.95/1.48
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks:

Remember that wave c rally that we had been waiting for? It's here now.

This appears to be the other shoe dropping — the first was the wave a rally from mid-March that ended with options expiration on March 21. The slide from the 21st to Monday was a wave b. This wave c should unfold in five waves up and it appears we are close to completing wave 3 up as of the close Wednesday. Time Ratio projections in the NASDAQ-100 suggest a wave c high could occur on Friday, followed by a resumption of the downtrend into late April.

As you are aware, our time cycle model, our Omega Predictor, correctly called the March 21 high ahead of that event, while the Bradley Calendar had March 28th for a high. We had been wondering whether this Bradley turn would actually be a double top, with the March 28th date the centerpost between the two highs. That appears to be the best explanation at this point. If that is indeed a centerpost between the two highs of a double top, Friday would be the ideal time for a wave c high.

In most cases, market rallies are tipped by outperformance by the NASDAQ-100 as compared to the S&P 500. In the current rally, this was not the case as the NASDAQ-100 was relatively weak going into Wednesday morning. This is another indication that the rally is a flash in the pan, short covering affair that should terminate the upmove shortly.

Our recommended spread trade gave back some of its gains as the NASDAQ took the lead, but it did not trigger a reversal signal since the spread held well above its middle Bollinger Band. That middle band, representing the 20-day moving average, is labelled on the daily spread chart of the June ES-NQ (in the Daily Spreads Charts section of the website). In fact, that middle Bollinger Band will normally serve as support on a pullback.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Wednesday, April 2, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.71/0.63
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Minor Bounce in Downtrend

Tuesday saw the market bounce from an oversold condition, helping to define the upper channel boundary in the intraday S&P 500 Index chart (see website for link). However, it wasn't a real, old-fashioned Turnaround Tuesday®. Just a minor bounce in the trend channel.

In case you haven't read Bob Prechter's discussion of the tick indicator, excepted from his Elliott Wave Theorist, we recommend it. It's linked from our main webpage in the free Elliott Wave International section (you have to be a member of Club EWI, but that's a free signup). The jist of Bob's finding is that here is a technical indicator which can be used to measure the ``Slope of Hope'' — that's the mudslide the bear market is following. In a bull market, it would be climbing a ``Wall of Worry'' and the tick indicator can also measure that. Very interesting reading.

Our recommended spread trade continues to gain ground. We recommended buying the S&P 500 Index or SPX and selling short the NASDAQ-100 or NDX. We use the June emini contracts to track this spread and that spread has a minimum margin requirement of $1750 (the spread is also updated on our main webpage just above the Relative Strength table in the Intraday Charts and Indicators section and also in a panel on the Trading Page). If you took advantage of Tuesday's countertrend rally to sell your SPX side, you're now short the NASDAQ-100 and in tune with the trend. Be sure to trail a stop order to cover your short as we move forward — an outright position is much more volatile than a spread. If you're still ensconced in the spread position, it helps limits your risk.

On Monday, the spread gained 22%. With the rally Tuesday, it actually gained another 28% (percentage gains based upon minimum margin requirement). We now suggest using a trailing stop order on the spread to reverse into a long NDX / short SPX spread (the middle Bollinger Band, shown on the daily spread chart can be used for this — when the spread drops below the middle band, it signals a reversal). The reason we want to reverse into the opposite position is that the downtrend will likely be coming close to an end when the NASDAQ-100 starts outperforming the S&P 500. A stop order to reverse the position (that is, an order to sell the S&P 500 short and buy the NASDAQ-100 long) will not only sweep those profits into the win column, it will get you positioned for the bottom that's out there later this month. Back in September 2002, the long NASDAQ-100 / short S&P 500 spread actually turned up four weeks ahead of the October low and proved to be not only a great leading indicator of an intermediate bottom, but also a very profitable position in its own right.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Tuesday, April 1, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.48/0.48
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Slip-Sliding

The stock market continued to slide down Manipulation Hill — the one made by those stock market derivatives manipulators to line their pockets leading into March options expiration. Time cycles point down on a trend basis for the next three weeks, although we should see at least one substantial countertrend rally before this slide in the mud finishes.

Normally, the last day of the first quarter is a strong up day for the broad market. Although the Value Line Index — best barometer of the broad market — did recover substantially from the early selloff, it couldn't hold and sold off to close near the low of the day.

Our recommended current trade, a long SPX and short NDX spread, gained over 20% on minimum margin Monday in the emini June spread. Although we didn't get a rally to sell our long SPX leg into, we're not complaining.

The market appears to be setting up a good base for the launch of the biggest bear market rally of the entire inglorious slide of the last three years. Money Flow remains relative high despite the retracement we're seeing. Accumulation of shares is taking place on price weakness and that's something that's been sorely missing from the market for a long time now. We'll be looking at stocks and sectors which hold up better in the selloff to lead the next big rally. That rally should start before the month of April is over.

But, this decline isn't over yet: Monday's bounce was an a-b-c affair, which means that in Elliott terms it was a corrective bounce within a continuing downtrend.

Corn

Corn vaulted higher Monday, but is close to near term resistance. We would like to see a basing period here rather than what looks to all intents and purposes like one more swift and short bear market rally. A retest of last week's lows would fill the bill.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Monday, March 31, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.79/0.21
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Note to AOL addressees: AOL has — without any justification whatsoever — decided to refuse to deliver email sent to you from our site. This kind of boneheaded decision illustrates why AOL stock has dropped 88% in the last 3 years.

Stocks: The Dump Following The Pump

Commercial stock market interests pushed the market down last week as the one-week bear market rally fizzled out. Retail investors had jumped the gun again, turning bullish far too early in this long term bear market. Of course, that's exactly what the commercial manipulators had planned when they started this campaign two weeks ago: pump prices up and then dump stocks to the retail crowd. It's the commercials who recognized that stocks were enormously overvalued and started short selling them even before the ultimate top. They have continued to sell stocks short, amassing huge profits all the way down, ever since.

The Commitment of Traders Report is our window on the actions of these commercial interests. The government requires them to disclose their positions for the world to see. On Friday afternoon, the latest report — which reflects positions held as of the close Tuesday — showed commercials were still net short the market, although they have been doing a bit of covering in the last couple of weeks. In the S&P 500, they are net short 188,439 emini contracts, while in the NASDAQ-100, they are net short 83,428 emini contracts. Some subscribers have emailed us claiming that the commercials had moved to net long the stock market, but they had failed to take into consideration positions in the emini contracts — commercials have been shifting into the eminis because of great liquidity in that market and the fact that they trade 23½ hours per day from Sunday afternoon until Friday afternoon.

After more than three years of unrelenting bear trend, even the most stubborn bull should be throwing in the towel by now, but they're not and they're paying the price. Until the crowd finally turns bearish, the underlying trend will remain down in the stock market — and the proper investment position continues to be short stocks.

The end of the bear market will not be marked by fear and loathing — it will be signaled when the majority of investors have sworn completely off the stock market. Of course, there are going to be countertrend rallies from time to time which keep the bullish juices flowing. These will serve one main purpose for the commercial interests: to distribute stock to the masses.

The Bradley Calendar (Larry Pesavento's rendition shown below) has been able to forecast every turning point in the stock market for the past year. As you can see, it's calling for a top now, a low on April 25, with a very big rally to come thereafter into July.

We discuss this coming rally, among other topics, in this week's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org:777/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Friday, March 28, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.98/1.57
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

Thursday started out on the downside, but heavy call buying in the QQQs (as seen on our intraday table — see Intraday OEX/QQQ History link on the main page) foreshadowed program trading which pushed the market back up the hill.

We have a preferred Elliott count right now of a wave b which should finish with a wave c rally into end-of-month and end-of-quarter Window Dressing, ending ideally today (Friday), but with Monday being the last day of the month — and traditionally a 70% chance of finishing up — as long as war news doesn't swamp the monthly seasonal, we could see the market levitated into early next week.

Once the stock market tops out here, we expect weakness for most of April. When stocks sell down, the bond market should make some sort of a recovery from its recent weakness. We remind you that TLT and IEF are exchange-traded shares which do well when the bond market does well and are a good reverse stock market play.

For those traders looking for alternatives to the war-driven financial markets, we direct your attention to the Corn market, which is coming into a cycle low next week and appears to be ripening up for a pretty good rally from a deeply-oversold condition. More this weekend.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Thursday, March 27, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.76/2.36
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

The market flatlined Wednesday, but the NASDAQ-100 maintained a slight relative strength advantage as compared to the blue chip SPX (S&P 500 Index) and DJ (Dow Jones Industrials), a sign that there is a chance that one more rally is possible in the market before it rolls over to the downside into the next trading low due in April.

The sideways pattern on Wednesday could be a contracting triangle, a pattern which is considered a continuation pattern preceding the final move in the direction of the trend. If it is a contracting triangle, the market should gyrate within a narrow band, then thrust higher to a peak, then reverse and head down with a vengeance.

End of quarter Window Dressing is a very real possibility this month due to the fact that the market is showing a slight gain for the year. Fund managers who are less than fully invested and whose funds are showing losses will be under pressure to jack prices of securities they hold up for the end of quarter snapshot. Thus, expect more price manipulation in the next few days.

Counterbalancing — and probably dominating — such Window Dressing will be War Undressing as the Battle for Baghdad starting next week is likely to undo all the manipulators' carefully laid derivative-based plans for jacking prices higher.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Wednesday, March 26, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.15/0.10 (4pm)
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: What To Look For Now

Since the recent rally may have been wave a within an a-b-c rally (an upward correction within the bear market), we need to consider this scenario. Tuesday's Turnaround action seems to be consistent with that view. Last Friday would then represent a momentum high, with an actual price high late this week which corresponds to the Bradley high due then.

Evidence which supports this scenario:

  1. The NASDAQ-100 (NDX) and Semiconductor Indices showed strength Tuesday. This typically precedes a rally in the blue chips.
  2. The retracement from Friday's high was relatively shallow despite being very quick.
  3. Hedge funds are selling QQQ put options in huge quantities, indicating they are bullish on the NASDAQ-100. They have done this before and it has led to rallies. They did so again on Tuesday morning as our sentiment measure on the QQQ zoomed higher on the put side, which is what we've seen before when hedge funds were selling puts (a bet that NDX is going higher).
  4. Oscillators reached an extreme level of overbought on the last rally. Typically, a higher high in price is needed to register a lower high in the oscillators to generate a condition of bearish divergence.

Due to this potential scenario, we continue to suggest that if you have to be in the market, you do so in a spread position (simultaneously long the S&P 500 Index and short the NASDAQ-100 Index), or in cash. If we do get a price high late this week and it reveals itself to be a top (as indicated by our various technical indicators), that would mark a sea change which would allow the long side of the spread to be jettisoned in favor of an outright short position.

As in the top last week, weakness in NDX relative to the SPX should warn of the approaching top if this scenario is unfolding.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Tuesday, March 25, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.61/0.67
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Pump and Dump Leads to Hangover

After the big options-driven party of the last week, driven by the greed of derivatives market manipulators who used the excuse of the outbreak of war to mount a Pump-and-Dump operation on retail investors, the market suffered a substantial hangover Monday, just as we expected it would.

The NASDAQ-100 retraced almost 3/8ths of its recent run-up, while the S&P 500 Index was relatively stronger and retraced only about a third. With the NDX weaker than the SPX, our ES-NQ spread widened to $1175 by the close Monday after moving very briefly below zero early last week. This signals that there is still an undertone of weakness to this market. Moves in the NASDAQ-100 typically will precede turns in the broad market by at least a couple of days, so we are likely to see further weakness in the market, perhaps after a bounce here. A good buy signal should be given when the spread between the two indices reverses into one favoring the NASDAQ-100 Index. This spread is also charted on the main page (NDX:SPX) in the Intraday Charts section — when NDX is weak, the price bars move down. As you can on that chart, the NASDAQ-100 showed weakness throughout most of last week, a clear warning that the rally was doomed to fail.

Like a hangover in a person, the market needs to recover from the binging it went on during the runup to options expiration. One sign that the market has completed its recovery will be the kind of negative sentiment we saw a couple of weeks ago just before the binge began. Until then, we suspect the market will swing wildly intraday with little net progress either direction until the recovery process is completed. But, there is also a possibility that the market could drop or rally sharply on news, so we suggest it's a good time for either spreading to reduce risk, or simply keeping the powder dry.

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Format for printing. [Go back]

For Monday, March 24, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 2.18/2.05
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Pump and Dump Rally Finished

Don't confuse the great profits we've made on short term trades on the long side over the last couple of weeks with the beginning of a true bull market. This ``perfect'' bear market rally probably finished Friday as bullish juices were fully reinvigorated to coincide with quadruple-witching derivatives expiration. Just like last October, the market manipulators were pushing all their derivative levers to pump stock prices higher. Our last short term buy signal from our trend stochastic indicator — see the Trading Page — remains in effect as of the close Friday for the S&P 500, but there are already sell signals in effect for the NASDAQ-100, QQQ, and Dow.

There were a number of reasons why the manipulators needed to rally the market, but foremost among them has to be the desire to make it appear that the fear of war was holding the economy back. Now that the war is on, they are eager to energize investor confidence so that the Wealth Effect of rising stock prices convinces them that their financial future is bright. And that they need to spend, spend, spend — both on stocks and consumer items.

But, the war wasn't holding the market back, the economy is still sick and by pumping prices higher so quickly, they have set the market up for another tumble back down the hill. We discuss prospects for the stock market and related markets in this week's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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Format for printing. [Go back]

For Friday, March 21, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.85/2.91
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

War took center stage Thursday along with the first stage of quadruple-witching derivatives expiration.

Our quote feed was down from the early morning hours, so our intraday data was spotty and our end of day processing will extend into Friday. We apologize for the delay, but the charts will not be updated for a considerable period of time.

It took quite of bit of cash to get the market this high — i.e., to make sure all those puts sold in the last month for March expiration would end up worthless. Now, normally, when this artificial inflation of stock prices naturally ends with expiration Friday, the hangover will send prices tumbling down the hill on the other side (next week). The question is just where the mud will stop sliding down the hill, given the background of war. The next Bradley turn, a nominal high, is due in one week, but our time cycle model has a peak due today (Friday). After next week, both indicators point down into turning point lows later in April.

It's thus not necessary to chase this rally and, if it turns out to be the real thing, there should be ample buying opportunities over the next month. Once the euphoria of victory is gone, the cold, hard realities of diminished earnings are likely to send the market lower.

And, after all, this is still a secular bear market. Expect surprises to be on the downside.

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Format for printing. [Go back]

For Thursday, March 20, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.82/1.62(4pm)
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Crowd Gets Bullish

Sentiment has always been a great guide to the market. It's now broadcasting a very clear message: this bear market rally of the last week is definitely not the beginning of a new bull market. Why? So many investors have turned bullish over the past week that a major turn up cannot have taken place. The latest bit of bad news for the bulls comes from Investor's Intelligence, whose sentiment surveys have consistently reported more bulls than bears over the entire 3+ years of bear market. We aren't likely to see an end to the bear market until the percentage of bearish investors rises above 60%. Only on rare occasions have the percentage of bears even slightly exceeded the percentage of bulls.

The bad news this week came in a huge jump in the number of bullish investors from 39.8% to 46.6% — a clear warning signal to anyone willing to listen. In fact, this whole rally is very likely a large scale pop-and-drop manipulation on the part of brokerages who have underwater positions in equities. To unload this ``toxic waste'' inventory, they push share prices up the hill using derivatives which require about one percent or less margin. The stock market is the only business we know of where consumers rush to buy when retailers raise prices. Once they've suckered the masses into getting back into the mood to buy, they unload their shares to the rubes. And, that's exactly what they're doing right now under the guise of a ``War Rally'' — how convenient for them!

One tool we have for detecting this manipulation is our option sentiment figures. When they want to push prices higher or lower, the percentage of activity in the QQQ options becomes a significant percentage of OEX options activity (the latter representing almost pure speculation). During the last week, we saw high levels of ``levitation'' in the QQQ options. On Wednesday, dollar volume dropped off to low levels in the QQQs, indicating that the manipulators were out of the options market now. That's a sign that they've finished priming the pump and are well into the distributional phase for this operation. Once the distributional phase is finished, the short selling will begin to drive prices lower.

Another sign that this current rally is running out of gas is that NASDAQ is losing strength relative to the blue chips. This tends to happen about two trading days before a significant top in the stock market.

And, time cycles and the Bradley Calendar point toward a top very soon. Our Omega Predictor is forecasting a top ideally Friday, with a downtrend in effect for April. The Bradley has a top projection for Friday the 28th ±4 trading days.

It appears it may be quite premature to turn bullish at the present time. After this pop-and-drop operation is finished, the disappointment created by it may actually generate a real buy signal — from much lower levels in the indices, that is.

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Format for printing. [Go back]

For Wednesday, March 19, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.60/2.93
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The market's mighty bounce ran into stiff resistance Tuesday as profit-taking dominated trading. The narrow range appears to be a wave 4 within the rally and can be seen in the QQQ quarter-hourly chart, within the final minutes of trading seeing a breakout in wave 5. This implies very limited upside potential from here. Once that minor wave 5 is complete, the market will be highly vulnerable to a retracement of the rally. The most likely support is in the 25.38 price area, shown as wave 2 in chart. Since that's also the Maximum Pain area for options holders, it's the most likely landing price for the NASDAQ-100 tracking stock QQQ on options expiration Friday this week. Note that the Money Flow Line peaked early on Monday morning and all subsequent trading in the QQQ can be considered distributional. The preceding accumulation period lasted 2½ days — if the distributional topping period is equal in time, it should end about midday Wednesday.

If the rally of the last few days is the initial leg up in another intermediate advance, it should be retraced substantially, especially considering the cycle lows due over the next few weeks. The Bradley Calendar has another turn due around the end of month, along with ones in early April, so we don't expect the market to be in a trending mode until we get past the middle of April. After that point in time it's clear sailing for this indicator. Remember, though, that's no guarantee of an actual uptrend in the market — it could be a strong downtrend. However, most other technical indicators point to the April-July period as being a period of generally rising prices.

The post options expiration period tends to see the excesses created by the manipulators reversed, so next week could very well provide a lower low than last week's into the turning point due on the 28th.

The Fed stood pat on short term interest rates Tuesday and failed to move their bias toward easing. We think this is the absolutely best course of action at the present time. That's because the negative perception of weakness implied by either a rate cut or a policy change to ease would do more harm than good psychologically at the present time. The ``no-change'' stance now allows the Fed to push longer term interest rates lower by buying 3-5-year Treasury debt, which will pump more money into the system, some of it is undoubtedly going to end up in other areas (including the stock market). Note that the Fed cannot just rev up the ``printing presses'' to create money. To get the money into circulation, there has to be demand for money. Just lowering the overnight interest rates is no guarantee than anyone will actually be interested in borrowing and the added liquidity may simply sit unused in banks (which it has for the most part).

Thus, the Fed's goal of pumping up the money supply has to be implemented by putting money into circulation by other means, namely purchases of longer term government bonds. When the Fed purchases those bonds on the open market, they inject money into the system and do pump up the money supply. The sellers of those bonds then have a choice of reinvesting those funds in other vehicles, including the stock market. And, as we all know, a rising stock market floats most boats. It may be several months before the Fed's actions kick in strongly. That notion dovetails with our estimate of a major stock bear market bottom late in the year.

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Format for printing. [Go back]

For Tuesday, March 18, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.67/1.58
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Celebrating Gulf War II

Stock market investors celebrated the quick victory in Gulf War II Monday by sending stock prices rocketing higher.

Wait . . . hold the presses! Now, we're being told that the war hasn't started yet. The crowd must be so anxious to buy that they're jumping the gun and buying on the rumor. Does this mean they are planning to sell the fact? Yep, it's very likely.

Traders are loving this market, especially those using our Trading Page signals. After last week's big jump in the Dow, which netted almost 400 points profit, the short term system gave another buy signal Monday morning and was ahead another hundred or so by the close. One way to use these signals is for short term spreading against a longer term position. For instance, if you're short the S&P 500 Index in a longer term bearish position, you can initiate a spread trade and buy the NASDAQ-100 on a shorter term buy signal from the trend stochastic. In the case of the current market's action, that spread trade not only protected your longer term position, it turned a nice profit on its own as the NASDAQ raced ahead of the S&P 500.

We have been investigating additional spreading opportunities and you can view the results on our Daily Spreads Page, linked from our main page. We have added Dow Jones/Value Line and S&P 400 MidCap/S&P 500 spreads today. For more information on spreads, including the number of futures contracts required for exchange margin requirements, you can visit the Chicago Mercantile Exchange or Chicago Board of Trade websites and navigate to their spread information pages. Or, use our Search Links Page form on the main webpage. Enter spreads as a search argument.

As for Tuesday, it's likely to be a typical Turnaround Tuesday® because the rally has moved the market into nosebleed territory again — and above the Max Pain levels at which option players as a whole lose the most money. Our expectation is for prices to drift lower to neutralize speculators' equity positions for the rest of the week.

Just a quick note for the long term: if this rally is the kickoff to a wave E rally in a very large contracting triangle starting at last July's low, it isn't bullish longer term. In fact, it may mean that after the next major high (due June or July), the market would plunge into Christmas 2004 and probably would see the Dow around 3500. We only give this possibility a 1-in-4 chance of being realized, but it's definitely a gloomy scenario to consider. On the bright side, it implies the market could rally into the 9000s on the Dow before turning down again.

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Monday, March 17, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.08/1.99
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Pros Put It To the Schmoes

Last week, the Pros on Wall Street really put it to the Schmoes — just as they do almost every month in the week ahead of options expirations. The Schmoes (small speculators) had happily been buying put options — bets the market would continue to fall — right into last week's low. We said that the ocean of puts provided a protective barrier against the market continuing to fall. Indeed it did!

When the Pros decided they had enough Shmoes on the hook, they reeled them in by raising stock prices. With their puts plummeting faster than they had risen, the Schmoes not only sold their puts (as evidenced by the heavy dollar volume in put options), they turned bullish on the ``rally'' and decided to buy stocks! That's why they're Schmoes and not Pros. It won't be too long before they'll be begging the Pros to sell them their puts once again. Only this time it will be the April series.

Last week, we were looking for a trading range and that's exactly what we got. The S&P 500 rose 4.38 points — +½% — the Dow three times as much, the NASDAQ-100 almost 5%. But, the broad market actually lost ground on the week as the Pros concentrated their buying power in the easily-manipulated, headline NASDAQ-100 stocks.

Now that the Pros have decimated the put options of the Schmoes, what do they have planned for an encore? The answer will be found in this week's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Friday, March 14, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.80/1.52
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The Bradley Calendar turn seems to be lifting the gloomy mood on Wall Street, causing Wednesday's short-covering rally to extend into Thursday. Of course, as Mark Fowler mentioned last week, a two-day rally tends to occur 4-8 trading days before options expiration as the pros ``put'' it to the schmoes they sold those puts to. Wednesday marked the seventh trading day before this month's options expiration. This cat-and-mouse game usually ends up as you'd expect: the mice get trapped and are forced to sell their rapidly-depreciating puts. After the small speculators have been thoroughly taken to the cleaners, the pros are likely to do what comes naturally: take the market down again and sell them those puts again — at inflated prices, of course.

One sign that's what was happening Thursday was provided by our intraday options figures: heavy call buying in the QQQs relative to the OEXs is an indication that the pros are using them to manipulate the market higher. You can follow those intraday figures on the website using the ``Intraday OEX/QQQ History'' link. On Thursday, QQQ call options saw $1.52 worth of buying pressure for each dollar of puts. But, more importantly, QQQs registered 69% of OEX call volume, very heavy volume for this option where volume typically runs around 10-15% of OEX call volume.

In case you're wondering, we're still short the market as we have been for over a month. We'll send out email if we change our position (that is, we'll send email if you've added yourself to the Notification List — see the link entitled, ``On Update: Notify Me By Email'' on the Special Reports header bar on the website main page to add yourself to the list).

Breadth was poor despite the rally. On the NYSE, 2376 issues advanced and 917 issues declined, for an advance-decline ratio of 2.59. That's very poor for a Dow up 270 points. Even among the high-flying small stocks of the NASDAQ, only 2215 stocks advanced versus 937 which declined, for an advance-decline ratio of 2.36. Again, that is a very poor ratio considering the NASDAQ-100 jumped over 59 points (6.1%). This rally is clearly a bear market oversold bounce that is likely to be completely retraced before long.

As far as the broad market was concerned, the rally did very little to help: the S&P 600 (SmallCap) Index rose only 2.89%, the Value Line only 3.25% and the NYSE Composite only 3.08%. Without participation by the broad list of stocks, this rally cannot last long.

The rally seems to have just about run its course as the NASDAQ approaches a short term resistance line on the intraday chart. But, look for weakness in the NASDAQ to precede weakness in the blue chips.

The bond market provided a ready source of funds to buy stocks (and QQQ call options) on Wednesday as it tumbled sharply on profit-taking. Many institutions are overweighted in bonds compared to what their asset allocation models say they should be, so they will be selling into any rallies in the bond market. This pile-up of cash is likely to (eventually) end up in the stock market over the next few months.

This rally is a good lesson in how to use Bollinger Bands. If you examine the daily charts of the various indices, you will notice that the decline into Wednesday sent prices plunging into the outer set of bands (the outer bands are shown in orange, representing the 50-day trend, while the inner light blue bands represent the 20-day trend). One rule of Bollinger Bands says that when a market breaks through a band — in this case, the inner blue band, it can bounce back into the bands in a countertrend move, but is very likely to come down to retest that band again later on. If, on the retest of that blue band the market fails to punch through it again, it indicates the trend is slowing and possibly reversing. So, we will look for the market to come back down and fail to punch below the blue band. That will mark a lower risk buying opportunity to cover shorts and go long the market for the expected 35-40% rally coming up in April-July.

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Format for printing. [Go back]

For Thursday, March 13, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.46/0.45 (3:40pm)
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Support Only 700 Points Lower

The crunch in stocks continued on Wednesday, with the weakest performance coming from the European markets. The FTSE-100 in London closed just above the lower, 50-day Bollinger Band. The last time the FTSE was this weak (on 21 Jan), it broke through that lower band and continued lower, making a low 10% lower six trading days later. However, the thrust decline has almost reached its minimum target. The possibility that it could chop sideways here in a wave 4 is high and a Time Ratio Low due 24 March could provide the final wave 5 bottoming timeframe. Note that the minimum target is near — with the Dow target 700 points lower, it's hard to think the FTSE will be able to hold these levels.

The Dow managed an oversold bounce in the afternoon, but the downtrend remains very strong. Sentiment improved a bit, but still isn't at levels we'd like to see for a bottom just yet.

There is a confluence of key support polytrendlines below the Dow which may come into play in the near future (see daily chart of ^DJI linked above). We say may because the market could be forming a low right now — we're right in the middle of the Bradley Calendar turn due Thursday ±4 trading days and the 9-month cycle due also right now. But, it's a good idea to look at where solid support lies ahead of time in case the market goes into freefall, which can happen at these significant cycle lows.

The yellow support line connects the key lows of 1987, 1990 and 1994. It currently lies just below 6800 and is rising at about 0.02% per trading day.

The violet support trendline is currently around 6751 and is rising slightly faster at 0.22% per trading day. That violet line was once a very key resistance line to the market. It was formed by connecting the pre-1987-crash high of August 1987 with the January 1994 high. The reason this line is so key is that once the market broke out above it, the Great Bubble of the 'Nineties was underway. It should provide support on the retest from above (a resistance line which is broken becomes support on a retest from above). It has taken over seven years for this retest of the breakout, but it appears we are close to it now.

The final polytrendline we want to discuss today is the green one. It was formed by connecting key lows in 1996, 1998 and 2002. It thus represents the underlying Bubble trend — and subsequent collapse. It currently is at 6811 and falling at the rate of 0.055% per day. It will cross under the yellow trendline on the 18th and under the violet trendline on the 28th. Those line intersections will occur in the 6750-6800 price zone, so we should look for that area to provide support. Needless to say, but we'll say it anyway, is that if the market fails to find support in that strong area where three support lines intersect, there is only air below. The implication is that the most massive crash in history would occur if the market breaks that support zone. The next chart support area is around 3600.

On the other hand, if the market holds those support lines — and we do think it will — the rally to follow will be coming off multi-year support levels, which is very bullish. In fact, we estimate the rally would see the Dow rise at least 35% in the next four months. Not too shabby for a bear market rally, in fact.

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Format for printing. [Go back]

For Wednesday, March 12, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.71/0.50 (4pm)
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

Stocks paused briefly in a tepid Tuesday turnaround, saw their shadow and headed underground again. There's a great lack of fear in this market which is needed for an intermediate low of any significance.

However, there's a lot of protection against downside risk that has been purchased. Earlier, we mentioned that twice as much money had gone into OEX puts in February and March than had gone into calls. At the suggestion of a reader that the QQQ options might be a more significant measure, we totalled up those options and found that 11 times as much money has gone into puts as calls! That's a huge amount of downside protection. However, in the month of March by itself, only 1.3 times as much money has gone into puts as calls. They were obviously very bearish in February, but not as much in March.

In the OEX, about the same ratio of dollars (1.38) went into bets on the downside as bets on the upside in March. We like to see that ratio around 2 to mark a good bottom. On Tuesday, it was in line with the month as a whole, arguing that everyone is looking for a bottom and isn't worried about the dip.

However, Paul Desmond of Lowry's Reports was quoted on CNBC as saying that Monday's 90% down day (90+% down volume and 90+% down prices) is typical of a bottoming pattern. But, he also pointed out that 70% of market bottoms will see at least six 90% down days. We can now look forward to 5 more down days like Monday — perhaps.

Although we have a Bradley turning point due Thursday, ±4 trading days, and a 9-month cycle due next week ±10 trading days, the final stages of an intermediate low in the market can do considerable price damage. For instance, the last two weeks of the previous 9-month cycle low saw the Dow drop 1800 points. And, the landing before that saw a 2000-point decline. If the low is two weeks out, that would put the Dow down to around 5500-5700 by the end of March. Thinking about buying? Don't. Not yet, anyway. Think short.

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Format for printing. [Go back]

For Tuesday, March 11, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.57/0.51
Popular Indices: http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://www.marketclues.net/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://www.marketclues.net/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://www.marketclues.net/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

The market slid to the bottom of its recent range (and dropped slightly below it on some measures) on Monday. We're looking for a 9-month cycle low in the near future and the breakdown in the strong stocks, such as Dell, is a sign that that low is approaching. But, it's not here just yet, so being short the market is still the way to bet.

But, despite the slide, options sentiment reflected a somewhat sanguine outlook for most of the day. There was no real panic, no rush for portfolio protection, suggesting that such protection (in the way of put options) had already been purchased and is in place protecting portfolios on the downside.

One interesting phenomenon of this decline is that most world stock markets have already dropped well below last year's lows. But, the US markets, despite a persistent decline in the US dollar which should be a negative for the stock market, are holding above those lows. This suggests that there is more strength under this market than many bears give it credit for.

Did you know that the real definition of inflation is, ``an abnormal increase in available currency and credit beyond the proportion of available goods, resulting in a sharp and continuing rise in price levels'' (American Heritage Dictionary)? In other words, it's not the rise in prices everyone assumes it is, but an abnormal rise in available currency and credit. The government has subtly redefined inflation as an increase in the Consumer Price Index. Why? To mask the abnormal rise in money supply — and the debasement of that fiat money.

Interestingly, the rise in the money supply in the Great Stock Bubble was ``only'' 258% in a time when the Dow rose about 1000%. Normally, a deflated measure of the Dow uses the CPI as a deflator, but if the money supply itself is used as a deflator, guess where the Dow would have to be to get back to the 1982 low? About 2800. Interestingly, the NASDAQ-100 has in fact been deflated by a percentage decline in that general neighborhood, down about 79% from its Bubble peak exactly three years ago Monday. We suspect that the Dow will play catch-down at some point over the next decade.

The bond rally is running out of steam. Despite the big decline in stocks Monday, bond prices barely moved to a new high. And, the US Dollar Index actually held support within last week's range. These are signs of a bottom ahead in stocks and the US$ and a top ahead in the bond market. And, it's all coming in a week with a Bradley Calendar turning point due Thursday ±4 trading days.

We are going to tighten up our buy stops on short positions and will be looking to buy the S&P 500 Index soon. The rally should be sharp and quick, as a bear market rally should be. In fact, rallies in bear markets are actually quit a bit more profitable in the short run than rallies in bull markets. But, we don't have a buy signal just yet. Should be soon, though.

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Format for printing. [Go back]

For Monday, March 10, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.61/0.85
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Stocks turned up after a horrid Employment Report Friday morning. Is this surprising strength in the face of bad news the all-clear signal that a new bull market has already begun? We are at the beginning of a major Bradley Calendar turning point and it's just possible that the low occured Friday morning. However, forecasting indicators like the Bradley must have confirmation from coincident indicators. We discuss this and other topics in this weekend's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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Format for printing. [Go back]

For Friday, March 7, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.72/0.46
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Although there are definite signs of a bottom forming, it's not here yet. The Money Flow figures are beginning to show that some money is coming in on dips, but that can be a long process with false starts before the ultimate price low.

The nervous stock market traded within a narrow range on Thursday. Such consolidations near the bottom of the larger range are typically followed by further dips to new lows.

The NASDAQ remains stronger than the blue chips just as they have been since September. In fact, the NASDAQ-100 is attempting to breakout above the red trendline in its daily chart. That red polytrendline was formed during the last stages of the Great Stock Bubble of the 'Nineties by the significant lows of 1998, 1999 and 2000. It was decisively broken in October 2000 as NDX headed for an 80% decline off its all-time high reached in March of that year. A significant support line which is broken on the downside becomes strong resistance when the market approaches it from underneath — and that's what we're seeing right now. NDX first tested it from underneath just a couple of weeks ago (21 Feb) and initially backed down. However, the second probe about a week ago was able to punch above it for two trading days before the market dropped back. It's clear that that long term cycle envelope is still presenting tough resistance, but the ability of the market to hang tough and keep testing, along with the obvious relative strength being shown in the NASDAQ compared to the blue chips, is significant and suggests that when NDX is able to break free from the influence of that cycle, it could have a clear shot at much higher levels.

Short term considerations could see much lower prices over the next week or two. But, that would very likely represent the best buying opportunity of this century — so far, at least — for intermediate to long term investors. Great opportunity lies ahead for those with patience.

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Format for printing. [Go back]

For Thursday, March 6, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.59/0.63
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]om")
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Stocks:

The market put in an oversold bounce on Wednesday, but option players took the opportunity to buy more puts than calls. The QQQ action was relatively heavy on both sides (puts and calls) and, to us, seems to indicate most players are going long volatility. What that means is they are buying both kinds of options in the hope that the market gets more volatile, time premiums expand and they can sell their options for a profit. The ideal scenario would have the market either soar or plunge (preferably, both in sequence) to drive volatility up.

As much as we hate to admit we agree with them, that's exactly what we think is going to happen as we near the 9-month cycle low due very soon. It could happen as early as next week with the coincident Bradley turning point due anywhere from this Friday to the Wednesday of options expiration week.

Mark Fowler, a professional trader, put forth an alternate scenario Wednesday afternoon: ``(A bidirectional move) would fit an option expiration pattern that seems to happen every month: a straight up move lasting 2-4 days, covering 50 S&P points and starting between 8 and 4 days prior to the Friday expiration day. I assume it is the pros taking money from the schomoes who buy way out of the money puts for "cheap" prices only to see them go to zero almost every time. Hoping the Aprils are the series that pay off when we dive to a low the last week in March or first week of April.''

We think the overridding event here is the Iraq War. The pros aren't likely going to be able to stand in the way of — or manipulate the market — in the face of something that big. In any case, the pros seem to be setting up for an increase in volatility.

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Format for printing. [Go back]

For Wednesday, March 5, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.81/1.23
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: The Waterfall Picks Up Speed

The market dipped again Tuesday and there was a notable lack of buyers lining up to buy stocks. They're on strike and likely to be on the sidelines until some minor issues, such as the fate of the country of Iraq and its inhabitants and ruler, reach a resolution.

The 9-month cycle should continue to pressure the market lower until next week or the week afterward — barring an early resolution to the Iraqi situation. The FTSE daily chart has an overhead resistance line shown on it that appears to be the envelope for that cycle. Until we can get a breakout through that line, we'll have to assume the cycle has not landed yet. The next Bradley Calendar turning point falls within the time period on either side of the Ides of March, making it a very important turning point.

There's a bit of uncertainty about the exact time for the landing of that 9-month cycle. It would have ideally landed in June of last year, but the market continued to a lower low in July. The question of whether it bottomed on schedule or landed late by a month remains. If it has been shifted by a month, we could very well see the mid-March low only represent a way station on the path down.

The NASDAQ-100 continued to hold up better than the blue chips on Tuesday. That pushed the NDX/SPX spread up to near a new high. This is good and bad. It's good because it means the high tech sector continues to outperform the blue chips — which is long term bullish. But, it's bad because we had been looking for the NASDAQ-100 to drop back and bottom ahead of the blue chips to give us a good buy signal for the coming bull market. Since the NASDAQ has been so much stronger than the rest of the market, it's possible this outperformance will continue even as the Dow and S&P 500 fall below their recent lows. That would be extremely bullish on the outlook for the bull run to follow this next low. And, that can't be all bad.

Finally, the Australian market is exhibiting bullish divergence as it attempts to find a bottom. That chart is indicating we're close to a low, but not there yet.

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Format for printing. [Go back]

For Tuesday, March 4, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.42/2.26
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Reversal of Fortune

The market rallied early, but reversed down within the prior range on Monday. After several days of a weak rally (weak because Money Flow didn't confirm the rise), a sharp selloff was to be expected. Any market which can't attract buyers at higher prices is destined to give up the rise.

We're now moving into the end of the Bradley Calendar turn window and the fact that the market has shown weak technicals throughout the window tells us it's a topping zone. The next turn is due mid-month (the Ides of March) which will likely be a significant low point, possibly the end of the first leg down of this secular bear market. At the ripe old age of 36 months off the March 2000 high, this bear market leg will slightly exceed the 1929 Crash in terms of time.

Both OEX and QQQ options traders favored calls on Monday, but the volume in QQQ calls was relatively light compared to OEX call volume. In prior sessions with QQQ dollar-volume near equal to OEX dollar-volume, the relationship has often appeared predictive, with the assumption that hedge funds were front-running program trades in the underlying stocks by buying huge quantities of call options. Light volume days, however, seem to be associated with more speculative traders, so we conclude the hedgies were on the sidelines on Monday, taking no big directional positions in the options. It's bearish that the OEXers were favoring calls in the face of a declining market.

The NDX/SPX spread was relatively volatile Monday as it peaked early at -1610, then dropped sharply to -2150, still within recent sessions' range, but confirming the reversal in the tech stocks. Since the techs have been in a relative strength rally since September, a correction there is overdue — and should provide a good buying opportunity for the coming rally — likely at some point in the next two weeks. Note that the March futures will expire on the 3rd Friday of March and the standard rollover date will be the 13th, 1½ weeks from now. The next contracts expire in June 2003. Those contracts should, in fact, be used for new positions this month to avoid paying extra commissions.

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Format for printing. [Go back]

For Monday, March 3, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.82/1.00
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Intraday Option Dollar Volume Page Available
Due to requests from several of you (thanks for the feedback), we have added a page which lists the intraday OEX and QQQ option dollar volume statistics. You will find that link just below the existing sentiment links on the main page. Note that if you have activated the spreadsheet option, the page will contain data in csv format for ease of importation into a spreadsheet; otherwise, in normal mode, the data will appear in HTML tabular format.

Stocks:

Hedge fund activities moved the market up and down on Friday. In the early going, they pushed the NASDAQ higher, but later in the day, pushed the market down again. Otherwise, there was little if any discernible trend as the market waited for the Iraq War to be resolved one way or another.

Friday was a transitional day as the market sets up for a very volatile March. We have a stock market low due in mid-March from time cycles, and bullish long term signs continue to point to higher prices ahead. That rally, however, could come from considerably lower levels, of course. Read more in our Detailed Comments Page . . . . http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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Format for printing. [Go back]

For Friday, February 28, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.85/2.65
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: An Hedgy Market

Hedge funds played games with stocks Thursday in a trendless market. These daytraders are moving the market up and down intraday with virtually no participation from longer term investors. One sign of this activity is in the QQQ options, where hedge fund activity tends to correlate with heavy dollar volume relative to the more traditional OEX options. Thursday's QQQ action revealed heavy call buying and it was no surprise that the NASDAQ-100 — the index which the QQQ shares track — showed a positive bias for the day.

But this is a market set on simmer and the lack of significant volatility means the Bollinger Bands, on an intermediate to long term basis, are pinching down, reflecting the narrowing range of trading we've seen. Money Flow has been diverging bearishly, suggesting that a cathartic selloff into the cycle low due in mid-March is the most likely conclusion to this low volatility regime. That plunge would be a head fake to the downside, washing out the weak hands and providing a buying opportunity for long term investors similar to the plunges we saw in 1991 at the commencement of Iraq War I, and at the panic lows of the late 'Nineties, which led to new highs in the indices. We probably won't get to new highs on all indices, but we won't say it's impossible. We do agree with Jim Cramer, who said on CNBC-TV that a 30% rally from lower levels is an entirely reasonable expectation following a plunge to Dow 7200.

We are within the time frame of a Bradley Calendar turn and a new moon due this weekend. Events in Baghdad are barrelling toward a conclusion and we're patient to wait for the market to tip its hand. In this weekend's update, we'll take a look at the indicators which are pointing toward an end to the trading range we've been in since last July. We'll also take a look at the oil market, which appears to be setting up some opportunities.

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Format for printing. [Go back]

For Thursday, February 27, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.92/0.48
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

While the market continued lower on Wednesday, Sentiment grew more bullish for the OEX options pit as call buying picked up steam. At the same time, QQQ traders grew more bearish. Since the QQQ traders tend to be right and the OEX traders wrong, this is not a good development for the bull camp.

Another sign of weakness and the overall market downtrend was evident in the declining value of the NDX/SPX spread as it continued to fall from last week's high. Looking at it from the opposite point of view, the SPX/NDX spread (calculated using the e-mini March futures contracts for the S&P 500 and the NASDAQ-100) has been gaining ground since its recent closing low last Thursday at $1760. That spread finished Wednesday at $2430. We expect that the coming major low in the stock market will be signaled after the spread reverses course, just as it did before the October low.

Additional signs that the Iraq War is heating up helped grease the skids Wednesday in the stock market, but the OEX figures make it appear that most traders are gearing up for the ``inevitable'' rally following the commencement of the war. Certainly, such a rally is very likely if history is a guide. However, it may not be a long-lasting rally because it is so well-advertised. Since the 9-month cycle is due very soon — the Ides (15th) of March has been our best guesstimate — we certainly wouldn't want the market to rally into that important turn date. A rally into an expected cycle low is a sign that the cycle has inverted — a high where a low should have been. Perhaps the Bradley turn date, due ideally today (Thursday), may have occured Friday — 4 days early but within the expected ±4 trading day leeway usually afforded Bradley turning points — implies a continuing decline into the middle of March turning point on the Calendar. The mid-March period is expected to be a market low similar to the September 2001 and July 2002 lows and very likely to see the Dow and S&P 500 falling to lower lows than either of those prior lows. On the other hand, we hope the NASDAQ-100 Index will remain above its prior lows to confirm the beginning of a new cyclical bull market.

The great bull market in oil continues. We'll be looking at that market in this weekend's update to see how to take advantage of the coming retracement of recent price highs. Oil is being inflated not only on fears of war, but also on the very real prospect that we are nearing the production crest for oil and will have mostly more costly alternatives to consider in the future. This is something Bushy alluded to in his State of the Union address. He should know — his family has been in the energy business for generations.

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Format for printing. [Go back]

For Wednesday, February 26, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.37/3.84
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Consumer Capitulation

The consumer seems to be in the capitulation stage right now. The one-month drop in confidence of over 14% was the highest since the 9-11 downing of the World Trade Center.

The market initially reacted to the downside, but something stopped the decline. Interestingly, it appears to be another case of QQQ buying power that turned the market and sent it soaring higher into the closing bell. We have noted on prior occasions that when the QQQ option dollar volume exceeds that of the OEX (and these figures are updated every ten minutes intraday on the website), the market often subsequently makes a move in that same direction. For example, when dollar volume in QQQ calls is high relative to both QQQ puts and OEX calls, the market will often turn up sharply within the next few trading hours.

We saw a lot of that kind of activity in the runup to the November Congressional Elections. That surging stock market undoubtedly helped the Republicans attain majority rule in the Congress. Are the Republicans again in the market, moving it higher? That's one explanation (and one we suggested would be the Republican game plan over the next year to assure four more years control in the White House). It looks like it's at least a good working hypothesis.

If the bears have to fight the headwind of the Administration, we suspect they will ultimately have to cover their short positions at much higher stock prices, so since we're within 2-3 weeks of a major time cycle low in the stock market, taking on aggressive short positions is not recommended. However, light short positions are probably the best way to bet until the bottom is confirmed.

With tonight's set of stock charts, we are adding Bollinger Bands to help those who trade individual stocks on a daily basis. There's quite a bit of good information which can be gleaned from Bollinger Bands for buy and sell signals, so we hope this will help.

We've also added actual price points for the bands, shown as of the current day to the right of the latest price points. The abbreviations are as follows:

As for what's ahead, we have a cycle high due now, a Bradley turn due now, and a war that appears to be getting very close to being kicked off in Iraq. In fact, this weekend brings the New Moon, the most likely time for an all-out air attack to soften up the country. The initial air attack is likely to be overwhelming to the Iraqi military and should convince most to surrender without a fight. We wouldn't be surprised if it were the first war to begin and end on the very same day. With this mix of news and technicals, the markets are likely to be extremely volatile over the next few weeks.

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Format for printing. [Go back]

For Tuesday, February 25, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.43/1.32
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Website Addition
We've added the NASDAQ-100/S&P 500 emini futures spread to the page in the Intraday Charts section just above the Relative Strength Table.

Stocks:

Stocks rallied very early on Monday, with the London market almost tagging the upper line of its ascending wedge pattern in its final wave up. And, in the US, the NASDAQ-100 showed a similar pattern: morning strength but an afternoon selloff. The NQ-ES March spread rallied from -1832 at Friday's close to an intraday high near -1471, then dropped sharply to form a low at -1865, and closing at the low. Since the NASDAQ had been leading the charge up the hill with the London market showing a very clear upward wedge pattern (bearish), it's very possible that we've see the reaction high now and that the waterfall wave 3 decline is underway. But, we haven't got a confirmed high in place just yet because the London market closed within the wedge and NASDAQ closed within the range of the last two days. Still, this is nail-bitingly close to a top and if you have to have a position in this market, it seems prudent to have a short position (or long the SPX/NDX spread — the inverse of the one we're watching for signs of strength).

Sentiment was mixed, with the OEX pit well into the overly-bearish zone and the QQQ traders slightly bullish, but on very light dollar volume. In this situation we have to side with the put buyers and expect further decline ahead.

Time cycles call for a top this week, and the Bradley says to look for a turn also (ideally, that turn would come on the 27th ±4 trading days by most estimates). The winds of war are blowing and its a very nervous market. The relative weakness in NASDAQ isn't yet at the critical stage — normally, NASDAQ is considerably weaker than the blue chips at a significant high — but the weakness in the spread trade is a strong warning to the bulls that we're heading lower very soon.

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Format for printing. [Go back]

For Monday, February 24, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.51/0.88
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

Stocks finished on an up-note last week as we expected. But, the time of war draws near. With the uncertainty of war, the future path for stocks looks exceedingly volatile. Yet, we have a clear path ahead that has elements which are both bearish and bullish. How to navigate the shoals? Subscribers, please follow the link to our Detailed Comments Page . . . . http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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[Go back]

For Friday, February 21, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.78/0.78
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

The stock market treaded water Thursday as buyers went on strike ahead of the coming war. The NDX/SPX spread, however, continued to move higher, rising $234 per the minimum futures position (our benchmark for this spread is 2 March NQ emini contracts held long for each March ES emini contract held short). The relative strength of the NASDAQ-100 continues to punch higher and it is now strong enough to say that the bottom is likely behind us — in other words, the mid-cap NASDAQ-100 Index continues to gain strength relative to the blue chip S&P 500 Index.

The relative strength chart of this spread (see the RS_NDX_SPX daily chart on the website) illustrates this phenomenon. An examination of it gives us an insight into how we might profit from the coming market low. Since the bottom in relative strength in September, the NASDAQ-100 has been leading the way higher. That bottom preceded the actual market bottom by about two weeks. The chart also shows that the last peak in relative strength occured on December 2, coincident with the price peak in the market. Even with the recent rally, that peak has yet to be exceeded.

Since we expect the overal market itself to peak very soon — as early as Friday, but as late as the first week of March — and to tumble into the cycle low due in March-April, we should expect the NDX/SPX spread to decline as well — just as it did in December. In fact, the spread may just tread water. But, it is likely that the spread will turn up ahead of the actual market price low, giving us an good signal to initiate a position in the NDX/SPX spread ahead of the actual market low.

Once the bullish trend higher is confirmed, the short side of the spread can be liquidated and turned into a long position.

For instance, here's an example using mutual funds:

When the NDX/SPX spread turns up (watch the relative strength charts for this), an investor could buy the double-strength NDX mutual fund RYVYX (Rydex Velocity 100) and simultaneously buy the reverse-index, or bear, fund RYTPX (Rydex Tempest 500) to initiate the spread position — long the NDX, short the SPX. Once the bottom is confirmed, the short side of the spread RYTPX can be liquidated and invested in a long position (the RYTPX can be sold and the proceeds used to purchases shares in either RYVYX or another bull fund).

As far as this current market is concerned, it appears the last couple of days of pullback represents a consolidation in preparation for another rally. That rally should be the last one of this upward correction. We'll be looking to sell the rally once it finishes, expecting a waterfall crash to cycle lows due in March and April. With complacency in great abundance, this is definitely a market "cruisin' for a bruisin'".

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Format for printing. [Go back]

For Thursday, February 20, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.66/0.87
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Note: corrected typo, changed 864 to 884 in text where it refers to 62% retracement level.

Stocks: Baiting the Trap

The market rested after three rally days Wednesday. The S&P 500 Index hit the 38% Fibonacci resistance level (854) on Tuesday and is resting before attempting to test the very significant 50% retracement level of 869 in coming days. Since we're counting this rally as an upward wave 2 correction in a bear market, and 50% retracements are standard for second waves, it's very likely that the market will top at 869 and enter a crash wave 3 to the downside very soon.

So, the market continues setting a very big trap for too-bullish investors. And, in the process, it's eating up most of the time premium (and intrinsic value) which had built up on most February put options. A 50% retracement would be fairly close to the Maximum Pain Theory level of 875 (884 is the 62% retracement level, which is even closer to Max Pain). Option short sellers can sometimes do some amazing things to move the market, but the underlying bear trend is so strong that we would not hold out for the higher index value. The tension in this market is building for a release to the downside just as soon as can be.

That's also evident in the London FTSE, which fell back into its wave b of 2 trading range Wednesday. We still think it's possible it could test overhead resistance by Friday, but there are no guarantees that something won't come out of the blue to trigger the cataclysmic decline which lies ahead.

Longer term, we are beginning to see evidence that the individual investor is turning bearish — after three long and grinding years of bear market. However, there's considerable leeway for further deterioration in long term sentiment. A crash into time cycle and Bradley lows due in March and in April would go a long way toward pushing sentiment to an extreme from which the next bull market could emerge.

Format for printing. [Go back]

For Wednesday, February 19, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.95/0.54
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: The Trap is Being Set

The market rose Tuesday. What you're seeing here is a trap being set just like last May. Investors, who had grown too bearish, are being taught a lesson in how a head fake is conducted. The rally this week is simply short-covering and option short-seller manipulation as the ``tail that wags the dog'' beckons investors to buy into a trap. Right now, sentiment figures are returning to neutral on our OEX options ratio, so while the trap is being set, investors have not yet entered the cage.

All of the indicators we respect are not confirming this rally. One of the signs we'd like to see to confirm the rally is a pickup in Money Flow into the market. We are not seeing that and, in fact, we are seeing bearish non-confirmations from all of our money flow indicators (except for the new NYSE Composite which is too new on the scene to have any historical validity).

Breadth is very poor if this is the kickoff to a powerful bull market. On the NYSE, winners edged out losers by less than a 3:1 ratio — a very mediocre reading. If this were a true bull market getting underway, we'd expect to see at least a 9:1 ratio for a couple of days. Obviously, this is just an oversold bounce in a strong bear market.

Of course, things aren't outright, short term bearish — yet. The NASDAQ is still outperforming the blue chips and that argues for at least 2-3 more days on the upside. When the small stocks start underperforming, it will be time to look for the next leg to the downside to get started in earnest. And, the best way to play the downside is to enter a spread trade, whether that's using mutual funds, stocks or futures. By entering a spread trade, you are entering a balanced position — both long and short. Your timing doesn't have to be perfect because at a major turning point in the market, the spread will tend to be much less volatile because of its balanced nature. Once the top is confirmed, you can then ``leg out'' of the bull side of the spread, leaving your position net short.

After reading John Bollinger's tutorial yesterday and his comments concerning the utility of 10-day and 50-day bands, we changed our charts to reflect his recommended configuration. The dark blue bands represent the 10-day, light blue bands the standard 20-day, and crimson bands the 50-day. We also are using his recommended standard deviation values of 1½, 2 and 2½, respectively. On the quarter-hourly charts, the bands are 2½ hours, 5 hours and 12½ hours.

The FTSE-100 on Tuesday crept ever closer to the polytrendline ceiling we show arcing overhead in that chart. It broke out of its wave b consolidation trading range and is headed for stiff resistance overhead. Once it tops out, the potential for a severe crash remains until at least the Ides of March, and possibly even longer. The reason we are watching the FTSE-100 is that it is leading the US indices by about a week — at the January top, the FTSE topped six trading days before the S&P 500. It should continue to act as a canary in the mineshaft (i.e., expiring and falling over before the US market peaks). However, we don't think the lag will be as much as six days, but much less this time 'round.

Format for printing. [Go back]

For Tuesday, February 18, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: N/A
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The US markets were closed Monday, but open everywhere else. In London, the FTSE-100 remained within its two-week trading range, which has a ceiling just below the 50% retracement of wave 1 down out of the long contracting triangle (3706). There are a number of factors which suggest that this wave 2 rally could potentially reach the 62% retracement level of 3780 by Friday the 21st. The overhead polytrend resistance line connecting significant rally highs comes into that price area on Friday, a date which not only represents a Time Ratio High projection, but also options expiration in the US and the next Bradley Calendar turning point. although the rally could top below that price (the 3754 area is also likely to present significant resistance to the rally due to an internal Fibonacci relationship within wave 2).

The Australian All-Ordinaries Index put in a tepid rally Monday, bouncing from a deeply oversold condition. New lows can't be long in coming from this very poor bounce.

One thing is clear: this market is taking no prisoners. It's bound and determined to drag in as much sideline cash as necessary to get its job done. Then, wave 3 to the downside should get started, a crash.

We have been showing you spread charts in the last few weeks, but we need to briefly discuss the bands shown on the charts. These are Bollinger Bands. The light blue band on the daily charts is the standard 20-day band, while the large red band is an 80-day band for a longer term perspective. As with standard price charts, Bollinger Bands give a statistical view of the market — where price is in relationship to where it has been relative to its recent volatility. When prices break through the 20-day band, it often means that a new trend in that same direction has been confirmed and that prices will continue to push higher or lower. After pushing up near the top of the band, a failure to push through it often signals a reversal down. We will be discussing how to use the bands for entry signals in conjunction with spread positions in future installments. In the meantime, if you aren't familiar with Bollinger Bands, John Bollinger provides a tutorial on their use on his website at http://www.bollingerbands.com/services/bb/intro.php and we suggest that as a good starting point.

With options expiration just four days away, put short sellers are pumping like mad to inflate the market in order to make those options expire worthless so that they can pocket the premium they received from the sale. This is eerily-reminiscent of the action last year during options expiration in May. That wave 2 rally pushed the S&P 500 Index up about 50 points in an impressive 8-day surge — but which paled in comparison to the subsequent 330-point wave 3 cliff dive into July. Will history repeat itself? Maybe not exactly, but it sure looks like it will rhyme.

Format for printing. [Go back]

For Monday, February 17, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.63/0.56
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

Monday is a holiday on Wall Street, but the financial circus will return on Tuesday in the US. World markets are on their own Monday, but should be fairly firm given Friday's rally.

Our recommendation last weekend of a trade returned over 50% in just three days last week. Read about it and how this is a great risk-control strategy that every investor should be familiar with on our Detailed Comments Page . . . . http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://66.69.200.116:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Friday, February 14, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.47/0.23
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Breaking Down

The market broke through the bottom of the (deceivingly) bullish descending wedge pattern Thursday morning and thus confirmed that we could be approaching a waterfall declining phase (so far, it has been more of a dripping faucet kind of decline). On the quarter-hourly intraday chart for the S&P 500, the angle heading downward of the short term support is now sharply increasing, so the cycle low still lies ahead with a corresponding overhead resistance line also rolling over.

For the past week, our sentiment numbers have reflected conditions which have led to bottoms in the past. However, although this has been our best indicator, there are rare occasions where it will be wrong. And, this appears to be one of them. Sentiment indicators indicate the majority is bearish, which is usually a good time to take an opposite position. But, in the middle of a trend, the crowd will be right. This appears to be the middle of the downtrend and figures that normally argue for a bullish position are simply confirming that the crowd is short — and correct.

Adding to the evidence in favor of the bears, our spread trade, which had been long (bullish) the NASDAQ and short (bearish) the S&Ps, broke down out of its rising channel Thursday morning after stalling out near the upper resistance line of the channel on Wednesday, signaling that the NASDAQ-100 was beginning to underperform the blue chip S&Ps. That's always been a bearish sign that more price weakness lies ahead. We are referring to the intraday NDX:SPX relative strength chart on the main page in the Intraday Charts section.

Money Flow has, since midweek, been growing ever more bearish as rallies are heavily sold into. The buyers may have a lot of cash to invest, but they're not putting it to work on dips and that failure to support the market is likely to lead to additional weakness in the future. We'd rather be on the team that is willing to pull their weight. Right now, that's the bear team.

Consequently, we liquidated our stock position and are officially selling rallies short. Your approach to this market is up to you (cash, short or bonds are three alternatives to consider depending upon your risk tolerance). If we do get an opportunity, we will look to buy stocks or initiate another spread position like the last one, which worked out very well. And, to that end, we have inaugurated a spread chart section on the website. Under the Daily Futures Charts link on the main page, we have added a link to Daily Spreads Charts. Initially, we only have the NASDAQ-100/S&P 500 spread trade we discussed earlier in the week (long the e-mini NQ and short the e-mini ES in a 2:1 contract proportion). The chart scale shows the difference in contract value between the long and short sides of the spread for a minimum position (long 2 March NQ contracts, short 1 March ES contract). The difference at the close Wednesday was $-2562.50, which is reflected in the vertical scales. Note that the absolute number (in this case, it's a negative number and shown in red) doesn't matter — it's the day-to-day directional change in that number that counts. The long side of the spread is first with the short side of the position subtracted from it. You want the line to move up from left to right, indicating your profits are growing.

As you have seen, spreads can be very profitable if you can simply determine which of the two securities (the two legs of the spread) will outperform. This is, in fact, the basis for the concept of hedge funds, which traditionally don't bet on the direction of the market as much as the relative performance of securities. By being simultaneously long and short related securities, profits can potentially be made by betting on the security which outperforms — even if both sides are falling, as has been the case recently with the NASDAQ-100 and the S&P 500.

We will add additional spread charts later on. And, we will discuss additional strategies which will help identify good spread trades.

Much of what we've learned about spread trading comes from Joe Ross, who has traded spreads for many years both on the floor and off the floor at various exchanges. He is the author of Trading Spreads and Seasonals, an excellent book in which he details many strategies for trading spreads. Joe also teaches traders at occasional seminars — he tells us that his next seminar will be in Houston on Feb. 22-23, then again in Houston on Mar. 8-9. After that, the next one will be in Atlanta on March 22-23. You can reach Joe's website at Trading Educators for more info if you're interested.

Right now, we favor the short side of stocks and look to sell rallies and to initiate good spread trades to minimize overall directional risk as compared to outright bullish or bearish positions.

Format for printing. [Go back]

For Thursday, February 13, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.34/0.14
Popular Indices: http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://66.69.200.116:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://66.69.200.116:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

Stocks continued to drift lower on Wednesday, hammered by a statement by a US government official that North Korea now had the capability to deliver a nuclear warhead to the West Coast of the United States. Whether that was, in fact, a true statement, is unknowable at the present time, but it cast gloom over the market for the rest of the day and buyers decided to sit on their hands another day.

Our featured spread trade this week held its ground well. This is probably a good day to go into a bit more detail about the trade. We'll use the e-mini futures as a real-world example:

For those who aren't aware, we suggested that the NASDAQ-100 Index (NDX) was likely to outperform the S&P 500 Index (SPX) — and the Dow Jones Industrials Average. By buying the NDX and selling short the SPX, a spread position can be created which may be profitable while reducing overall risk.

Of course, you can't directly buy and sell short the indices. However, there are a number of trading vehicles which allow you to. In the futures, the March NQ contract (the ticker symbol may vary: at Xpresstrade, it's EN3H, and on our charts, it's NQ_H3) represents the NASDAQ-100. And, the March ES contract (ticker symbol @ES3H at Xpresstrade) represents the S&P 500. The NQ contract is valued at $20 per NDX point; the ES contract has a value of $50 per SPX point.

According to the margin requirements for this spread trade set by the exchange (the Chicago Mercantile Exchange or CME), for each ES contract you should hold two NQ contracts. In other words, if you were to enter a spread like we suggested, you would buy 2 NQ contracts for every 1 ES contract you sell short. We will assume you entered the minimum position: long 2 NQ contracts and short one ES contract.

On Tuesday, the NQ side of the position closed at a value of $38,860 (971.50 × $20 × 2 contracts) and the ES side closed at a value of $41,462.50 (829.25 × $50 × 1 contract). On Wednesday, the NQ side had a closing value of $38,300, a loss of $560 as the index fell 14 points. But, the ES side also fell 12 points. That meant that our short side of the spread actually gained value ($600). So, on a day when both indices fell, we still ended up with a slight paper gain of $40. Not nearly as fun as Tuesday, when the spread gained on both legs of the spread ($540 on the NQ side and $362.50 on the ES side, for a total of $902.50 on Tuesday). But, for a position whose margin requirement is only $1773 (at Xpresstrade), a paper profit of $942.50 represents a nice gain on a relatively lower-risk position than an outright bullish or bearish position on the market.

As far as the overall market direction is concerned, we are likely to see a rally get started very soon. With options expiration just a little over a week away, it is not likely (but it is possible) that all those put buyers are going to get to keep their profits. The normal behavior would call for option market makers to buy stocks, lifting their prices enough to allow the maximum number of put options (as well as call options) to expire worthless on the 21st day of February. With a neutral trend, we suspect they will be able to. Given a war surprise, all bets are off.

If we do get a confirmation of a rally, we plan to buy back our short ES side of the spread and look to sell short at a higher level when the rally runs out of gas. That will allow the long side of the spread to gain on the rally — at the cost of increased risk by holding an outright bullish position.

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Format for printing. [Go back]

For Wednesday, February 12, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.31/1.62
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Tuesday's market continued to swing within a narrow trading range much like last week's market. It truly is a market for daytraders, who control risk by not being exposed to overnight gaps in price and are quick to take profits or losses.

However, we've recently discussed another technique which may be appropriate for this market. That technique is technically called ``spreading.'' It simply means that one security is purchased and another (related) security is sold short. The combined position is called a spread.

Since the beginning of the year, the NASDAQ-100 has declined 1.29%. In that same period of time the S&P 500 has declined 5.75%. A spread trade where equal dollar amounts of the NASDAQ-100 are bought and the S&P 500 are sold short would have returned a profit of 4.46% in a period where the market was generally on the downside. The NASDAQ-100 trades as a stock under the ticker symbol QQQ, while the S&P 500 trades as a stock under the ticker symbol SPY. Alternatively, futures contracts are available for both in maxi (ND and SP) and mini (NQ and ES) contract sizes — suitable only for very experienced investors, of course.

On Tuesday, the NASDAQ-100 rose by 0.17% and the S&P 500 fell by 0.79%. For the day, the spread position (long the NASDAQ-100 and short the S&P 500) gained 0.96%. It's not everyday when both sides of the spread gain money, but it's very nice when it happens.

Note that in order to realize the percentage returns cited, you would have leveraged each side by 200% (this is the maximum leverage afforded in the cash stock market). In the futures, much higher leverage is available of course.

The market continues to build a substantial base for a rally. Once it does start, it will be wise to lift the short side of the spread in order to participate fully in the rise. This is called ``legging-out'' of a spread. Once the rally becomes mature, the S&P 500 can be sold short again at a higher level to reinstate the spread.

Format for printing. [Go back]

For Tuesday, February 11, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.50/0.02
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Monday looked like a holiday as stock traders, both sellers and buyers, decided to sit on their hands for a while and see how the situation in Iraq turns out. All of the stock market indices closed the quiet session slightly higher than last week.

The NASDAQ-100 Index, which had been trimmed by 80% off its all-time highs as recently as last October, has recovered better than its cousins, the Dow and S&P 500. That's one reason we think we're closing in on the beginning of the next bull market — and why the NASDAQ may very well have already put its low in. At the end of the 1982 bear market, the Dow bottomed in August — nine whole months after the bottom in NASDAQ.

On the whole, however, it's likely that this trading range, now almost 7 months old, will last into the middle of the year, at least for the headline Dow. The market has been having a lot of trouble making up its mind about the future course of business — the longer this period of indecision goes, the stronger will be the move once it does end (and that move is likely to see a head fake in the downward direction before the real trend higher gets established). Right now, the market is telling us that the crowd is tipped too far to the bearish side of sentiment. Dollar volume in OEX puts is exactly twice the dollar volume of calls, reflecting the fact that the average investor is pretty discouraged with the market and expects further decline ahead. The market is prone to doing just the opposite, of course.

Last weekend's analysis, if you happened to have missed it, can be found on our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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Format for printing. [Go back]

For Monday, February 10, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.38/0.73
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: That Seventies Show

These past few months of sideways stock market trend remind us more than ever of the market of the 1970s (hence the reference to the FOX-TV show). That decade saw the market drift sideways in a trading range to work off the excesses of the 'Fifties and 'Sixties. However, it is interesting to note that, despite the initial plunge off the 'Sixties high into the early 'Seventies, the market was able to retest the old high before plunging again into the 1974 low. There are enough similarities here for us to entertain the notion that a bull market move to new highs is not out of the question yet. The chart below illustrates the long term view:

Quarterly S&P 500 Chart

We discuss this and other topics on this weekend's Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

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Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org:777/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Friday, February 7, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.33/0.01
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

Great fear continues to grip the stock market, as evidenced by huge volumes in puts on the NASDAQ-100 ETF known as QQQ. For the last few days, total dollar volume in the QQQs has dwarfed the OEX — volumes on the order of a half a billion dollars per day. The trades have apparently been done by a large Wall Street brokerage house as bullish bets on the QQQ to close between 45 and 55 at a specified time in the future. The QQQ closed Thursday at 24.08, so the initiator of this position apparently expects the QQQ to double in the future.

There are probably two key points here:

  1. When you see transaction volumes which cumulatively total more than a billion dollars within a week in a high technology stock index, you have to suspect that someone with the wherewithal to make a big bet is making a bet on the future. It appears they are making a bet that the market will go up. There is always the possibility that whoever is making this bet will be wrong.
  2. The fact that the put seller is able to find the depth of put buyers to take on the other side of this trade gives you an idea of just how bearish the buyers are. This is bullish from a contrary point of view.

Note that on the OEX daily chart, we have noted a fresh buy signal from the ``WC'' indicator.

Right now, we have a market that is unable to break down or rally up. It's under compression and true volatility has declined very sharply. The option volatility measures (VIX and QQV) are much higher than historical volatility, which is a bullish indicator. Although there is a huge pool of cash built up on the sidelines, it appears unwilling to take a stand in stocks. At some point in the future, this cash is likely to come back in. Given the experience with the last war in Iraq, that cash is likely to come back in just as soon as the war breaks out.

Money Flow continues to hold up despite price weakness, particularly in the QQQ and SPY where surges in buying pressure occured on the close Thursday. We remain long stocks here, but would not hesitate to switch to bonds and/or cash in a flash.

Format for printing. [Go back]

For Thursday, February 6, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.66/0.02 (4pm EST)
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

If you don't like the direction the stock market is heading, just wait a while and it will change. The market has been stuck in a narrow trading range for the last eight days, touching the bottom four times (including Wednesday) and the top three times (including Wednesday). Obviously, this is a market searching for direction and not finding any.

Some of the positives we've been pointing to over the past week failed to appear on Wednesday's rally. Money Flow diminished along with bearish sentiment. Those two had been propping the market up, but with the poor performance Wednesday, we have to be alert to the potential for the trading range to break down.

The US Dollar Index turned up sharply (and the Euro plunged), and that factor probably provided much of the support for stocks. Although the dollar turned down late in the day, it does appear that a trend change to the upside for the Dollar (and a trend change to the downside for the Euro) has occured and should be supportive for stocks.

Secretary Powell's presentation before the UN held center stage early Wednesday and provided a positive backdrop for the market as it appeared to strongly support the case for coalition action to disarm Iraq. However, statements by an intransigent French ambassador appeared to throw a bucket of cold water on the market later in the day with his suggestion that even more inspectors are needed. We suspect that the French — and many others — might change their attitude just as soon as Saddam Hussein obtains missiles capable of delivering their chemical, biological and nuclear payloads to Paris. Powell made the choice clear: live with a growing cancer in the MidEast, or excise it now.

As for the stock market, if it can't get some momentum going soon, we'll probably move back into cash and/or bonds (TLT and IEF are bond shares which make excellent proxies for the actual Treasury bonds).

Format for printing. [Go back]

For Wednesday, February 5, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.31/0.09
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

This market is looking more and more bullish by the day. Despite the selldown to the bottom of the recent trading range on Tuesday, it held there very well — and even closed on an upnote. Money Flow remains very positive as volume declines on dips and rises on rallies. And, Sentiment is very supportive, with the OEX numbers showing traders are well into overly-bearish territory — and NDX traders are throwing huge amounts into bets the market will crash here. Another of our ``lead-dog'' indices, the Semiconductor Index, held above its prior low, a strong sign of strength. All of our trading oscillators are in buy mode right now, as well, as well as exhibiting bullish divergence. We certainly would not want to be short this market right now because it looks as if it's poised to explode on the upside.

The US Dollar Index dropped sharply on Tuesday, which probably stimulated a lot of foreign disinvestment in US stocks. But the entire decline was well-contained within the last week's range and US investors are stepping up to the plate to buy stocks near their lows, suggesting that as soon as the Dollar moves back up, stocks will follow.

Format for printing. [Go back]

For Tuesday, February 4, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.05/0.01
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks:

It's clear that sentiment has hit an extreme in the NASDAQ-100. On Monday, QQQ bears poured over 100 times as much money into puts (bets the market would decline sharply) as calls. Now, either they know for a fact that the market is about to crash or they're a contrary indicator that says the market is about to head higher.

We've noticed that on some occasions, heavy volume in those QQQ options can be predictive of future market action. And, in fact, other sources have mentioned that QQQ program traders sometimes ``front-run'' their futures program trades by taking a position in the options market. So, it is possible that program traders are taking a very big position in the options because they know for a fact that they are going to initiate some very large program trades in the near future.

On the other hand, option traders tend to be caught on the wrong side of the trade more often than not. That's been our experience over the last 12 years of following the OEX dollar-weighted option figures. So, Monday's gargantuan put purchases may actually fall in that category. The other technical indicators suggest as much, with a cycle low due in the current timeframe and the market primed for a short term rally, as we've discussed in recent days.

In any case, these lopsided figures suggest to us that we are probably looking at a contrary situation, rather than program traders front-running their own programs.

Our working assumption here remains that we have a very oversold market which wants to go up — for now. Money Flow remains very constructive as those money flow lines in the various intraday charts show rising trends as money comes into the stocks even as prices appear to be bumping along a cycle trend channel bottom. Obviously, it's a very nervous market poised on a knife edge, expecting the war with Iraq to breakout any day now. With absolutely incontrovertible evidence that Iraq is harboring weapons of mass destruction, it's almost certain that the US will have the blessing of the UN to move on Iraq in the near future. When that happens, expect an initial dip, then a strong rally as it becomes clear that the war will be very brief.

Format for printing. [Go back]

For Monday, February 3, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.66/0.56
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

www.marketclues.net Still Down
Our DSL service is still undergoing construction by SBC — does SBC also do highway construction? That would explain why it takes forever for roads to get built/repaired. Use clues.dhs.org (see above) instead for now.

Stocks: What is the Market Telling Us Now?

While we sometimes attempt to forecast the market, we also remind you that forecasting the market is not necessary for profitable investing. What is most important when making investment decisions is keeping an open mind and listening to what the market is trying to tell you. That's why we have developed a multitude of technical tools which help us decipher those messages and why we've made them available on our website for you to use.

Last week, the crowd was bearish and the market went down. But, is that what the market was really saying? Or, is the market really sending us a more bullish outlook for at least the short term? For subscribers, we discuss the message we're hearing on our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Friday, January 31, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.61/0.71
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

The market is bumping along a bottom here as it appears that those QQQ program traders are enjoying the neutral trend by pushing the market up on Wednesday, then back down again on Thursday. The dollar-weighted option figures we track on our website indicate that their moves are a good leading indicator for short term moves in the market. When QQQ dollar volume is high (relative to the OEX figures), the market is very likely to move in the direction they're leaning: down when put volume is high and up when call volume is high. In other words, the QQQ figures are predictive when total QQQ dollar volume exceeds OEX dollar volume.

While those program traders seem to have control of the market now, it's only because of a completely neutral underlying trend that such control is possible. Once the market starts trending, we doubt even the QQQ traders will have any choice as to which direction to send the market. Until that day, however, it does appear that by watching the intraday option trading via our website, short term traders have an excellent leading indicator for market direction.

The NASDAQ-100 has been forming a rounding bottom trend channel on the quarter-hourly chart. This is almost exactly the same pattern it formed at the October lows. If it continues to follow the channel, it should accelerate higher in the week ahead.

Format for printing. [Go back]

For Thursday, January 30, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.63/2.34 as of 3:30 pm
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.
DSL Situation
We're betwixt and between: Covad has a brand new line to try to work with, but SBC (your friendly neighborhood phone company which can't shoot straight), as per standard operating procedure can't get it to work at all, is flummoxed again. For now, use the clues.dhs.org line to access our website.

Stocks:

Stocks put in a good bottom and rallied Wednesday. That was surprising to the bears who expected a crash from these levels, but not surprising at all to Market Clues subscribers who have been reading our market calls. Still, all we do is try to listen to what the market itself is trying to tell us — something almost anyone can do if they put their mind to it. You can read our interpretation of what we're hearing by going to our
Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Wednesday, January 29, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

The big jump in Money Flow into the blue chips Monday (see the
SPY 15-minute chart) gave us advanced warning of Tuesday's turnaround rally in the stock market. Now, this rally could be (and has been by various commentators) rationalized as a short-covering affair ahead of Tuesday evening's State of the Union address, but perhaps the shorts have detected at least a short term trend change in the wind? We suspect we'll get the standard 50% retracement rally in the market before any substantial further waterfall decline in the market. That's especially likely given the deeply oversold condition and the propinquity of that monthly seasonal we call the Monthly Buying Spree. Thursday begins that monthly seasonal this time 'round.

In tune with our comments on the Detailed Comments Page after the close Monday, we have added intraday charts showing the relative strength of the NASDAQ-100 Index (NDX) as compared to, respectively, the S&P 500 Index (SPX) and the Dow Jones Industrials Average (DJ) to our Intraday Charts section. You will find these two charts directly above the Relative Strength Table on the main page at the website (links given above near the top of this message).

Covad: An Improvement in DSL Service?
We have been informed by our Internet Service Provider that they will be switching our DSL line back to Covad in the near future. That should be an improvement to the reliability of that line if our prior experience with Covad is any guide. However, during the switchover, expect more downtime. Please use the clues.dhs.org link should you encounter problems accessing the website (as always).

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Tuesday, January 28, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.44/0.59
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

The market slipped on a banana peel known as the US Dollar Monday as that currency continued to lose favor among non-US investors. Confidence in the US is a very important factor in worldwide stock prices and current attitudes are leading investors to sell stocks and ask questions later.

The inability of the world's greatest economy to recover from recession has investors worried that the recession will soon turn into something much bigger: a deflationary depression as envisioned by Robert Prechter in his book Conquer the Crash. Add the fact that stocks are at nose-bleed levels of valuation — priced for perfection, as it were — and you have the ulimate resolution to a 6-month shelf of distribution: a thrust decline with little reaction to sell into.

On the other hand, there are growing signs of a substantial rally developing out of this market on the very near term. How do you profit from a rally in a bear market and, perhaps, make money being both a bull and a bear simultaneously? Subscribers, for an explanation, follow the link to our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Monday, January 27, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.45/1.06
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

Fear returned to the minds of investors and traders on Friday as the market tumbled down the slippery slope. Our short term sentiment gauge finally registered a degree of fear which should lead to a rally, but the bounce is likely to be more of an opportunity for short sellers to get a good opportunity rather than anything longer lasting. We discuss what's ahead for subscribers (including trial subscribers, of course) on our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org:777/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

[Go back]

For Friday, January 24, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

The stock market bottomed early in Thursday's session and started the retracement rally (counter to the downtrend) we were looking for. This is a trading rally which should see a price retracement of 50-78% of the initial decline and should provide some fun for traders while it lasts. The bond market fell, also as expected, due to traders taking profits on their bond gains.

The rally should be expected to be an a-b-c affair, with the current rise wave a, wave b a substantial pullback, and wave c a sharp rise. Overall, the market has completed wave 1 down with Thursday's low and is now in a wave 2 rally. Wave 3, potentially a devastating crash to below the October low, could follow the end of this wave 2 rally.

Format for printing. [Go back]

For Thursday, January 23, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

Wednesday was a consolidation day as stocks staged a minor bounce and then turned south again into the close. But, a more substantial bounce is likely warming up in the wings. The timing and rally potential of the bounce is discussed on our
Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page ("http://www.constant.com/~bcarver/sub.html") for details!

Format for printing. [Go back]

For Wednesday, January 22, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Stocks:

The market continued to slide down the slippery slope Tuesday, but appears to be closing in on a turn to the upside very soon. We're counting this as wave 1 down in a five-wave decline that should carry the market well below the October lows.

The turn to the upside will be counted as wave 2 and should represent a low-risk opportunity to short sell this very, very overvalued stock market. That opportunity could come later this week. For now, our bond holdings are doing well as a safe haven from the carnage ongoing in the stock market. Wave 2 is most likely to recoup about half of wave 1 losses before the market turns south in a devastating wave 3 ``crash.''

Wave 3 down during February is likely to be considered a ``crash'' by most stock investors. Why is the market falling apart during this seasonally up-biased period? Lack of confidence. Investors are losing confidence in the US dollar, in the President, and in the stock market. As Bush said Tuesday, ``This is a bad movie and I'm not watchin' it.'' Neither are investors. They'd just as soon sit on their hands until stocks are much, much lower.

Format for printing. [Go back]

For Monday, January 20, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.82/0.29
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

A Forecast for Real Estate in 2003:
Read this excerpt, taken from "The Economy" section of the Elliott Wave Financial Forecast that explains our — Elliott Wave International's — current view of the real estate market. The recently published January edition of the Elliott Wave Financial Forecast puts the events of 2002 into context and looks ahead to market action in the coming year.

Market Holiday Monday

US markets are closed Monday, but will reopen Tuesday.

Stocks:

Stocks tumbled last week as the seasonal uptrend failed and disappointed stock investors. After reaching the week's high on Monday, the market reacted negatively to better than expected earnings news during the remainder of the week. We don't pay attention to the news itself, but to the market's reaction to the news. A sea change has evidently occured now that the market punishes companies which even outperform estimates. It was only weeks ago when the market would reward companies which disappointed only slightly — and positively fell in love with any company which surprised on the upside. This is a sign that the underlying trend has reversed to the downside.

The top the market made last week is likely to be retested — eventually — but we don't hold out much hope that higher highs are imminent. The downtrend, however, is likely to setup a great buying opportunity when we reach the Ides of March (March 15th), and investors can look forward to a good rally for several weeks thereafter. Unfortunately, that rally is likely to be yet another bear market rally. These periodic rallies are actually very profitable affairs while they last, but they don't last long before giving way to lower lows. The long term buy and hold investor is being taught a very important lesson in market dynamics. It's unlikely that the majority are going to stick it out through the entire bear market before swearing off stocks entirely.

We assess the risks and the potential scenarios further for subscribers on our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

If you haven't taken out a paid subscription yet, it's easy to do either with your credit card or by check. Visit our Subscription Page for details ("http://www.constant.com/~bcarver/sub.html")!

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org:777/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Friday, January 10, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

DSL Unreliable
If you try to use the www.marketclues.net address and are not seeing a response, or a very slow response, it's because our SBC tin cans are being blown around in the breeze, so use the clues.dhs.org address instead to get to the website. Thank you for your patience with 19th Century technology (we don't have much left, however). The only thing stopping us from shorting SBC is that they are a monopoly and mostly own the government.

Stocks:

The stock market rallied back as we said Thursday morning before the opening and the overall pattern of this rally is falling into place exactly as we laid out in the FTSE-100 chart (the market has moved up along the dashed green line). If it continues to follow that roadmap, look for prices to generally trend higher from here.

But, danger lies ahead, Will Robinson — and soon, as we explain in our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

In that link above, we give a very specific, detailed scenario for how the market is likely to move over the next couple of weeks and how you can extract profits at this critical juncture and get positioned for a very big move directly ahead. We're sure this information will come in very handy for your shorter term — and your longer term — investment decisions. If you're not a subscriber, that link above won't work, unfortunately. Might be a good time to make a very small investment by subscribing to Market Clues. Go to http://clues.dhs.org:777/sub.html for details now!

Format for printing. [Go back]

For Thursday, January 9, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

European Intraday Charts
We have added an intraday chart of the stock market in Great Britain (Dow Jones' Great Britain Index) to the MyClues page (links above) and, since our quote vendor is no longer supplying us with French CAC and German DAX quotes on an intraday basis, we have switched over to charting the Dow Jones French and German intraday indices. The European markets have been leading the US market in recent months, so early birds in the US can catch the European action overnight and in the morning with our new intraday charts.

The chart of the Great Britain Dow is especially important to pay attention to because it is tracing out a pattern almost identical to the FTSE-100, the significance of which we have discussed in prior updates.

Stocks: Correcting the Rally

The market retraced a healthy chunk of the New Year rally so far on Wednesday, but held above key chart support. Yesterday, we suggested short term traders take profits and look to buy the dip. It looks like the latter part of that strategy may be possible very soon, but keep in mind that we are dealing with a terminal rally phase within an overall market pattern that has been under construction since late July. Once this upward, bear market corrective rally is over, the next move is likely to smash all bullish positions — there is likely to be no stock that won't go down, in fact. Further discussion of short term considerations for subscribers continues on our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Wednesday, January 8, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Sell the News

Traders bought the rumor of tax relief, but selling on the news was relatively mild and consistent with a pause in the rally and not a total end to it. As we have suggested, the current rally should bear close similarity to the previous October-November rally. And, during that prior wave c, the market put in most of its gains very early on, then spent a longer period of time simply consolidating the gains, moving sideways in a trading range. Since we've covered a significant fraction of the width of the triangle pattern (over 50%), a consolidation into next week is likely, then a final rally to the intermediate top in the market. Investors should hold here while short term traders should take profits and look for a dip to repurchase. It's too early to sell this market short.

Format for printing. [Go back]

For Tuesday, January 7, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.55/3.90
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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In a study of previous bear markets, Elliott Wave International notes that Even The Worst Bear Markets Have Rallies.

Stocks: Wave e Rally Feasts on Bears

The wave e rally continued on Monday, despite some early attempts by the bears to sell it short. The bulls are having a great time as they give us re-runs of the October-November rally. Unfortunately, the rally will give way to a waterfall decline that takes away well more than twice the profits the bulls are reaping in this rally.

The OEX traders are growing bullish, but have not yet reached the overly-bullish stage (2.0 or greater on the call-put ratio), nor have we seen bearish divergence on this key indicator. Thus, the short term trend remains up.

The key to taking profits on our bullish positions will be recognizing the top when it comes. And since the next top will usher in that waterfall decline, we can't let our guard down. We look at how the internal wave structure of the current rally is unfolding in our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Monday, January 6, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.27/0.26
Popular Indices: http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org:777/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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DSL Link Down
As of Friday morning, our DSL link (www.marketclues.net) went down due to an area-wide power outage. After power was restored, the link failed to come back up and SBC has been notified of the problem. The alternative link above (clues.dhs.org) should be used to access the website until SBC fixes the DSL link.

Stocks: Protecting Against Event Risk

After our very timely asset shift from bonds into stocks last week, most investors should now be thinking about protecting against surprises which might send the stock market tumbling. This week we discuss ways which not only protect stock portfolios from event risk, but also virtually guarantee a profit on both the portfolio and the hedging instrument.

We also present our 2003 forecast for the stock market. Although the market is likely to trend sideways for the year as a whole, it should do so within a wide-swinging trading range which is likely to offer larger profit opportunities for intermediate term investors than even the best of bull market years.

Looking out over the next few weeks, we project a likely price high for the current rally — and emphasize the downside potential/risk that will follow this next peak. Subscribers, follow the link to read more on our Detailed Comments Page . . . . http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Friday, January 3, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.85/1.36
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Party On Into 2003

The stock market had a nice party Thursday as it celebrated the promise of a new year. As we told you it would, the cessation of tax loss selling released a lot of pent-up demand and the sideline cash poured back into the market. After selling our TLT shares on Tuesday for a very nice profit (the TLT tracks the Treasury Bond and represents a defensive position which normally will rise when stocks fall), those shares fell over 3% from our sales price just since Tuesday morning. And, our new purchases of the Dow Industrials, S&P 500, S&P 600 Small Caps, NASDAQ-100 and other index products soared in value on Thursday.

The year is getting off to a great start, following our very profitable 2002. 2003 looks like it will be even better. If you haven't subscribed yet, be sure to do so — you could have made back the cost of a five-year subscription just on the first day of 2003!

Click here to subscribe via PayPal (you can use major credit cards through the PayPal service). Or, click here for instructions on how to pay by check.

Subscribers only can continue on to read our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Wednesday, January 1, 2003
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.52/0.46
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Happy New Year!

Investors closed out 2002 on a slight up note despite procrastinators' tax loss selling in the final hours. And, our clearest index as far as patterns is concerned also put in a nice gain on the last trading day of the year (see the
FTSE-100 chart for details on the exact wave count and the path we have projected for the next couple of months in this leading index).

We have now sold our interest-rate sensitive shares (TLT) and are invested in the stock market via market index ETFs (Exchange-Traded Funds), which we expect will rise if the rally we envision unfolds as anticipated. The cessation of tax loss selling Thursday, along with an improved attitude among investors, is likely to lead to a nice rally for the next few weeks. After the next rally top, however, we expect some fireworks on the downside, which we will be discussing in more detail in this weekend's update. If you are a new subscriber, you can catch up on our current market analysis on our Detailed Comments Page. http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

For now, however, the market is closed for New Year's Day and we'll be back with our next update after the New York close Thursday. Everyone, please have a safe and happy New Year's and look forward to an exciting and potentially very profitable 2003.

Format for printing. [Go back]

For Tuesday, December 31, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.53/5.31
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Interesting reading:

In a study of previous bear markets, Elliott Wave International notes that Even The Worst Bear Markets Have Rallies.

Looking for a personal approach to learning about Elliott wave analysis? Read Robert Gordon's essay "Elliott Wave for the Masses." Robert Gordon, an experienced Elliottician, considers his discovery of Elliott waves in 1995 the most important event in his 62 years of investing.

Lessons from the fall of an empire by Harold James, offers a chilling view of the remarkable similarity to today's Empire to one of two thousand years ago.

Stocks: 2002 Grinds To An End

Bargain hunting lifted stocks slightly Monday, but there was little eagerness on the part of buyers, who are, most likely, more interested in which New Year's Eve party they'll be attending than to which stocks to buy.

Sentiment remains bullish in the OEX pit — that is, most players there are not bullish, which in a contrary way is bullish — where almost twice as much money went into downside bets as upside ones Monday. However, the QQQ bulls are out in force now, pouring over five times as much money into calls as puts. In fact, those QQQ bulls spent twice as much money on calls as their OEX cousins did. Normally, the dollar volume in OEX options dwarfs the QQQ variety, so there are some very big bets being placed in NASDAQ rebounding from its funk next year.

Unfortunately, we are going to have to see better accumulation before biting for a long side (bullish) position. We will probably be buying on Tuesday for the scheduled 2003 rally, but only if the market is showing some backbone first. If you haven't already, you can read our further comments on our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Monday, December 30, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.48/0.66
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Tax Selling

The stock market declined last week on the back of tax loss selling and the hangover from the previous week's Quadruple Witching options and futures expiration. Overall, though, there was a pronounced lack of buyers, so prices simply sank under the pressure of mild selling pressure.

Don't believe the nonsense you read from the Associated Press, though. They blamed the rise in oil prices for the triple-digit loss in the Dow, claiming that stock investors feared inflation would ``ripple through the rest of the economy, driving prices . . . higher.'' If only it were so — a whiff of inflation would absolutely send the market soaring! What the market fears is deflation and that's what higher oil prices are reinforcing. A rise in oil prices draws cash out of the pool of money available for discretionary spending and thus lowers demand for other goods (absent increased borrowing, of course). If supply remains constant while demand falls, the result is deflation, not inflation. That's also why bond prices rose alongside oil prices, by the way. If investors really feared rising inflation, they would have sold bonds down as well. At the very least, however, the AP is good for a nice laugh.

For other analysis you won't find in the local paper (or much of anywhere else, for that matter), follow the link to our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Our normal weekend commentary on other markets can also be found at the link above.

Format for printing. [Go back]

For Friday, December 27, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.57/1.61
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
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Stocks: Boxing Day

The market gave the bulls and the bears a challenge Thursday. Initially, it rallied right up to key resistance, then turned down, losing all the gains and then some. Finally, it closed virtually unchanged on the day. Most markets around the world were closed for the holiday, but Wall Street probably got what it deserved for being open on a holiday. But, the action on the street was quite easy to understand if you look at one of our intraday charts which shows a trendline which has accurately tracked the market since the October low — and continues to track support and resistance. Details are on our
Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com
[Go back]

For Thursday, December 26, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.90/2.53
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: Investors Find Presents Under the Political Tree

Both the Republicans and the Democrats eagerly proposed presents for investors this holiday season: cutting or eliminating double taxes on corporate dividends, accelerated depreciation and cutting or eliminating capital gains taxes on stock held long term. While these are enough to lift the markets over the next few weeks (possibly as high as to within hailing distance of the 10,000's for the Dow and above 1100 for the S&P 500 — and even to a brand new all-time high record on the Value Line — they aren't going to be enough to levitate earnings.

But, in the spirit of the season, it's the thought that counts and anything that reflates the market is bound to have some trickle-down effects on the real economy (if only to re-inflate the late, great Bubble in price-earnings ratios).

This doesn't change our forecast for the market at all, as we discuss further in our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Tuesday, December 24, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.50/1.34
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks:

The start to a holiday-shortened week saw a pronounced slowing of trading following last Friday's Quadruple-Witching expiration of stock options, stock index options, stock futures, and stock index futures.

This week is not only a holiday-modulated week, but the ideal low timeframe for a time cycle low (Christmas Day) and a Bradley Calendar turning point (the 30th). What that means is that we are likely to see little trend during the next week. And, given the likelihood of a rally in the final wave within an Elliott contracting triangle (wave e up), we expect that we will get a (possibly) delayed Santa Claus rally in the opening days or weeks of the New Year.

We are planning to buy index-based products over the next week, but want to reiterate that there is substantial overall risk of a strong leg down following the next intermediate peak in the market.

In a normal year, the broad market strengthens this time of year as stocks oversold as a result of tax-loss selling rebound. We may be seeing such a phenomenon occuring now in fact. This is the basis of the 100% track record for profitability of long Value Line - short S&P trades, as we've mentioned many times before.

New ETF Feature on the Website
At the request of a subscriber, we have added a new feature to the ETF (Exchange Traded Fund) Dynamic Relative Strength form on the MyClues page. The new feature adds the ability to specify an ending date that prices are compared to. The default if not overridden is the previous close (shown as "yesterday" in the form). However, you can erase "yesterday" and enter another date and that date's close will be used as the ending date for the comparison. For instance, if you wanted to compare ETFs on relative strength for the five-day period immediately preceding October 10th, 2002, you would enter 5 for the number of days and enter 20021010 for the Comparison to: date. The format of the date is YYYYMMDD where YYYY is year, MM is month, DD is day of month. There's a 30-second limit on how long the computations can take on our server. Email if you run into the limit and we'll consider raising it.

Format for printing. [Go back]

For Monday, December 23, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.09/0.67
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: A Turn Is Near

The stock market is getting very close to a turn to the upside. We discuss finessing the turn in our
Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro moved to test the overhead violet-colored trendline formed by the highs of January 2001 and July 2002. The currency was rejected by this latest test, suggesting the high may be in. Wait for confirmation before selling the Euro short.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The Dollar Index also looks like it's very close to a bottom here (since it moves exactly opposite the Euro, that's certainly very consistent). Could be a buy very soon for foreign investors looking to move into the world's safest fiat currency.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The Canadian Dollar continues to bang its head on the 50% retracement level of the last decline, all the while demonstrating bearish divergence. The bear trend remains alive.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

The TSE Index briefly broke above its August high last week, but fell back into the short term trading range. A breakout above 381.78 would be bullish. Next resistance is above 410 on the red resistance trendline (daily chart).

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The A$ has shown a lot more resilience than we expected — due, no doubt, to the positive effect of rising gold prices. Still, a pullback is due. Watch the daily chart support lines for signs of a long term breakdown and decline to (potentially) plumb new lows.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

Strength on Wall Street over the next month could help pull the Aussie stock market out of its funk. But, we'd be surprised if it lasts very long and a drive to lower lows appears very likely in February and March.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

The FTSE-100 came down to the support line and bounced off it last week. This is the index to watch for a successful retest of that line, as discussed in our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Bonds / Interest Rates:

Bond prices have a little bit of room to rally, but there's trouble in bond-land ahead. Additional comments can be found on our Detailed Comments Page . . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

Commodity prices, as reflected in the CRB Index, were boosted by oil and gold last week. Short term, they've entered a consolidation trading range before the next leg up. Rising commodity prices do not indicate an outbreak of inflation. Why? If inflation were on the horizon, bonds would not have rallied in concert with commodity prices.

Format for printing. [Go back]

For Friday, December 20, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.49/0.91
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks and Bonds:

Although the market tumbled again on Thursday, there were signs of a turn on the horizon. Is that a Ho-ho-ho! we hear coming from a jolly old Saint Nick as he warms up for his yearly visit to Wall Street? We discuss the potential for turns in both stocks and bonds on our
Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Thursday, December 19, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.47/0.82
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks:

The ``pop-fly'' rally, which we thought would last a couple of days, fizzled quickly and the market fell back to earth with a thud. It's unusual for a December Triple-Witch futures and options expiration week to see such a weak market, but the frazzled market has a lot to contend with these days. With the sabers rattling in Washington and rumors flying about a military strike before January, most investors are ready to close their books on the third straight year of overall losses.

We, however, have better things in mind in coming weeks. A potentially very lucrative series of market moves is fast approaching and we don't intend to miss them. Read about them on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Wednesday, December 18, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.89/1.01
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

After Monday's surge higher, the market spent Tuesday digesting the gains. It was another case of the worm climbing the greased pole two inches higher, then sliding down an inch. Unfortunately, all of this effort in stocks is likely to have very limited rewards over the next four months.

One of the big concerns that's beginning to surface here is that foreigners will cash in their US chips and move their money back home. That was the focus of a story on Yahoo! this week: Dollar at risk as global investors quietly exit US ("http://biz.yahoo.com/rf/021216/markets_japan_dollar_1.html"). Certainly, the action in gold suggests investors are beginning to get dissatisfied with not only the US$, but also the other fiat currencies. If foreigners pull their money from the US, the stock market might even find itself heading for fair value (under Dow 5000 in our estimation).

Speaking of valuations, Terry Laundry ("http://www.ttheory.com/") has been doing a series of studies in the last year on that very topic. His conclusions are essentially the same as ours: no lasting bull market can get started with stocks as overvalued as they are right now.

Even so, there are good opportunities ahead which we have discussed recently. The market may take until Thursday or Friday to get finished with this little ``pop-fly'' rally, but the path of least resistance is clearly on the downside now. Watch the sentiment numbers: when the option players turn bullish, it will be a sign the next leg down is close at hand. And, that should mark a good opportunity in other sectors.

Rather than setting specific price targets, we'd rather watch the market — and listen to its message. The market is always sending a message. It's best to be listening for it, rather than forcing your own ideas of what it should do on the market. You'll never win that argument.

Suggestions on where this market may be heading can be found on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Tuesday, December 17, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.70/0.79
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Finally, That Bounce

We finally got that countertrend bounce we've been looking for and the pattern is beginning to clear. Although there are likely to be several twists and turns in the weeks and months ahead, having a clear roadmap to follow is very important in making money in this market. That's exactly the subject of today's discussion in our
Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Monday, December 16, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.56/0.37
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: High Anxiety

The market fell last week in slow motion, with the Dow and S&P 500 ending about 6.7% below their early December peaks and the more volatile NASDAQ-100 off almost 13% from its high. What started as what the sanguine bulls termed a ``necessary correction'' after the big runup from the October lows has turned into a worrisome slide that shows little signs of a turn.

That's good — it means that a minor pullback has been able to wash most of the short term bullish sentiment out of the market. Right after the slide began, short term option players were confidently buying calls, anticipating a short term pullback to be followed by a rise to higher highs — that's extremely bearish and reminiscent of the behavior of these traders right after the March 2000 kickoff of the whole bear market. Even though we are still leaning to the long term bearish case (there's certainly very little evidence that the two-month rally off the October lows was any different than any of the bear market rallies that preceded it), we think that the market is due for a minor rally back to retrace at least half its losses before turning down again.

The Bradley has been nailing each and every twist and turn in the stock market for the past several months. The next significant turn in the downtrend is scheduled for the end of the month. That turn date coincides closely with the ideal bottom in the dominant trading cycle, which last bottomed on July 24th. The actual ideal low in the cycle occurs on Christmas Day. When a low occurs on a holiday, the days afterward can be quite volatile and trendless because the cycle has not yet turned up with enough force to really move prices, so we don't expect the market to do much until after New Year's Day. As you can see from the Bradley table, the market could rally for a few weeks in January, then resume the downtrend. The real bottom in this bear market is probably many months away, but these bear market rallies of 20-40% keep investors bullish enough to stay in stocks for the whole ride down — just like in the Crash years of 1929-1932. By the way, the Crash and decline in the 'Thirties lasted 34 months (a Fibonacci number, incidentally). The current bear market will be 34 months in length next month and, from the evidence at hand, looks ready to best the old mark by at least a couple of months. Now, if you count the bear market as starting in September 2000 (rather than March) — a secondary peak — it would have to go to July 2003 to equal the duration of the 'Thirties bear. The current bear market has sliced more than 50% off the value of the US stock market, but the 'Thirties bear took about 90%. And, given the fact that stocks are selling at a price-earnings ratio of 29 to over 50 (the first figure is if you believe reported corporate earnings, while the second figure is if you believe S&P's core earnings estimates). The average Price-Earning ratios at the bottom of past bear markets? 12. Oops, it looks like there's air underneath this market.

One tell-tale sign of a big rally starting would be a 9:1 breadth day. In other words, when 9 times as many stocks are advancing than are declining (at the close), it signals a big uptrend in effect. This happened on the last day of 1986. It's possible it could happen again this year. Back in '86, most market watchers dismissed the significance of this due to low trading volume. It turned out to presage a 900-point rally in the Dow (doesn't sound like much these days, but back then, that 900 points was a lot).

New Chart

We've added a chart of the Volatility Index (VIX) which includes Bollinger Bands. These bands help identify extremes of highs and lows by measuring statistical volatility. Our version of Bollinger Bands measures three different timescales: 5-day, 20-day (the standard measure) and 80-day, which are shown in different background colors to distinguish them (dark blue for 5-day, blue for 20-day and crimson for 80-day). You'll notice that at the end of November, VIX reached an extreme on the medium term (20-day) band and started rising. This preceded the recent price peak in the market by a couple of trading days. Some of you emailed to ask why VIX was rising along with prices. It turned out that it was an excellent time to sell.

However, despite the bear market, we've been able to find stocks that are rising, as we discuss in our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com There we discuss a sector which rose sharply last week and we also mention some seasonal trading opportunities which, historically, have never lost money!

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

We think the market is very close to topping, but hasn't yet. Europe's economy is far worse off than the US economy, growing little more than 1% recently while the US has been growing at least twice as fast. There's no reason the Euro should be at current levels. Once it tops, it should be a great short sale. The only reason we can see for the Euro to be up is that the US dollar was down on gold strength. Otherwise, this currency would have been down in dollar terms.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The Dollar Index was weak last week, moving inversely to gold.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The Canadian currency hit the top of the trading range within a long term downtrend last week, a price which also just happens to mark a 50% retracement of the last big decline. The stage is set for further decline ahead.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

While we did not get a bounceback in the US stock market, we got a bit of a rally in the Toronto TSE Index. This bounce is likely to continue on the very short term, with the market destined to trend lower into the 2nd quarter of 2003.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The Aussie dollar continues to struggle with the long term, violet-colored resistance line (see the Weekly Chart). This line has held the A$ back for several years and it's doing so again. If the A$ cannot break out successfully, we expect a fall into the 53¢ level, at which point a reassessment of long term prospects would be required.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

Near term a trading range is likely. Last week's decline took the All-Ordinaries to near the mid-November low, but more importantly, the market is now in oversold territory. Look for a bounce rally this week (as long as the November 12th low of 2915.40 is not significantly broken).

A rally above the dark brown overhead resistance polytrendline on the daily chart would be extremely bullish and signal an end to the bear market and a substantial rise ahead.

Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

A short term bullish development has occured as the daily chart indicates. Expect a short term rally to get underway shortly (as long as Friday's low isn't taken out) and the market could rally for several days before topping (look for resistance at the top line of the triangle) and plunging to near 3300 (Friday's low was 3839.40). Some very interesting and volatile trading is coming to the London market, which tends to lead Wall Street a bit.

Bonds / Interest Rates:

Strength in stocks near term should send the bond market down in a retracement of the recent rally. More on the Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

The CRB Index, despite new relative highs, is climbing up under its old support line on the Weekly CRB Chart and should soon find the trend has turned down. Only gold and oil are driving commodity prices right now and they're not inflationary (rising oil prices act as a braking force on the economy, evidenced by the fact that the bond market rallies on rising oil prices and falls on sinking oil). Anyone who thinks inflation is about to get out of hand isn't watching the real economy.

Format for printing. [Go back]

For Friday, December 13, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.89/1.39
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

The time cycles are all pushing stocks down, despite the desperate attempts of money managers to manipulate prices higher. Again on Thursday, heavy flows of cash into QQQ (NASDAQ-100) call options failed to maintain an uptrend in the stock market. Has the magic failed the manipulators? It certainly does look that way!

With cyclic pressure due to grow ever more negative in the near future, it won't be long before the rats realize the ship is sinking and they are trapped on the Titanic as it lunges below the surface one last time.

But, the areas we've highlighted as likely to do well are, indeed, doing very well right now. Further discussion can be found on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Thursday, December 12, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.13/1.98
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks:

The market continues to attempt to rally, but is having trouble getting traction. The QQQ (NASDAQ-100) option players, who have been buying loads of call options (bets that the NASDAQ will rally, have so far been frustrated. Normally, option players are the ``Wrong-Way Corrigans'' of the market, usually becoming bullish at the top and bearish at the bottom. That's, in fact, the kind of track record the OEX traders have exhibited for more than the decade we've been tracking their sentiment. However, in recent weeks, especially during the October-November rally, the QQQ players were exceptionally good at tipping coming rally surges by moving into calls in large numbers. We attributed this phenomenon to front-running their own buy programs in the underlying stocks — in essence, they were helping boost profits on their call options by buying the underlying stocks.

Undoubtedly, they were helped by speculators who were jumping back into the same stocks they had bolted out of in the May-July decline. In fact, one of the tipoffs that the rally was not the beginning of a true bull market was the fact that overvalued stocks were rapidly growing even more spectacularly overvalued, rather than a rotation into undervalued new leaders. In other words, the ``Greater Fool Theory'' was working in the QQQ players' favor.

With the recent rally sending overvalued NASDAQ stocks into nose-bleed territory, however, there may be a considerable lack of new fools. We still can't count out the possibility of a rally to take back around half to two-thirds of the decline so far, but time is running out for the NASDAQ bulls. The 16-day cycle bottomed last week, but has provided only brief spurts to the upside. It appears from our Money Flow analysis that heavy selling continues to come in on rallies. We won't rule out a rebound rally just yet, but it appears the downtrend is just as strong as ever.

This is in line with the Bradley Calendar: the next turning point is weeks away now. And, the overall trend is expected to remain down for months. However, there are long term signs that say 2003 will bring a huge rally, but it could very well get started from much lower levels than the current market is trading at.

The long term pattern in the broad market, which we have discussed as our preferred count several months ago, continues to take on the appearance of a large trading range known in Elliott Wave circles as a contracting triangle. We're nearing the final phases of it and the fireworks are going to go off in a big way early next year if the pattern plays out to a conclusion in January. We are likely to see a volatile trading market within a narrowing trading range, as the pattern calls for. The final wave within the triangle should get started at the next significant trading low due late this month.

In any case, next year's bull market should be a real barn-burner on the upside (and you thought we would always be bearish?).

Format for printing. [Go back]

For Wednesday, December 11, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.56/1.42
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

A slow-motion bounce took hold of Wall Street Tuesday, but there was little evidence that investors were getting any more confident in the ability of the market to move up — as it normally does this time of year. Sentiment is beginning to become a more positive indicator, though. The fact that only 56¢ of upside bets on the OEX were made for each dollar of downside bets says the crowd is betting on the downside. That's a good contrary number and very close to the level which we like to see for a good trading bottom.

Indeed, those traders are probably right on the intermediate term trend, but the short term trend is more likely to see the market retrace about half of its December losses before we get another leg down. Indeed, the QQQ traders were considerably more bullish Tuesday than their OEX counterparts — and the QQQ traders have been prescient on market moves in the last couple of months. Additional comments will be found on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Tuesday, December 10, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.73/0.80
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
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Stocks:

The tumble off the spike reversal high of Dec 2nd continued on Monday. Although option traders are growing a bit more bearish, they haven't even come close to being truly bearish yet, so any bounce here would be of only short term relief from the oversold condition. The trend is likely to continue lower through the rest of the month, although a trading range could send the market sideways until the short term oversold condition is worked off.

One reason to expect a trading range is that Money Flow continues to diverge bullishly on the SPY chart, while growing less bearish on the QQQ chart. That is enough to suspect that the market makers and floor traders are ready to see a bit of short covering before taking stock prices lower. All bets are off when the bombing of Iraq begins in earnest, of course. That's a foregone conclusion at this point given strong evidence that Iraq is a major thorn in the coalition's side — and likely to become a truly serious infection if not treated in the near future. No matter how hard Saddam tries to hide his weapons of mass destruction, it won't be long before this monster and his regime will be forcefully ended.

Once the fighting has progressed to the point where it is clear that the coalition will win a major victory in the region, the stock market is very likely to celebrate. However, at this point, the best estimates we've heard on when that will be point to no earlier than January, and possibly a bit later (our technical work points toward a major bear market low in the March-April timeframe).

Dow Quote Problem

Quotes from the CBOT on Monday were just plain wrong, which affected some of the charts.

Format for printing. [Go back]

For Monday, December 9, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: A Divided Market

There are a couple of stocks which exactly mirror two key market indices: SPY tracks the S&P 500 Index of 500 blue chip stocks and QQQ tracks the NASDAQ-100 Index of 100 leading NASDAQ stocks. In the October-November rally just concluded, the QQQ outperformed the SPY by a considerable margin. We have noticed, though, that the Money Flow patterns in these two stocks painted very different pictures this past week, as the following charts illustrate:


[Both of these charts are updated every quarter-hour during market hours on your MyClues website. The SPY link is next to the S&P 500 intraday link, while the QQQ link is below the Relative Strength Table.]

The QQQ chart above shows a very clear pattern of distribution, indicating that the bulk of the trading activity is dominated by selling pressure — the Money Flow line has been trending lower. There is no evidence of significant or sustained buying pressure, leading to the conclusion that this index, and by extension the high tech sector it represents, remains in a bearish trend.

The SPY chart, on the other hand, shows more of a fluctuation between phases of bullish accumulation (rising Money Flow line) and bearish distribution (falling Money Flow line). During the first part of last week, when the SPY was peaking, the Money Flow line shows that sellers were dominating trading and warned that the rally was not to be trusted by those long (i.e., those who are bullish and holding stock index futures or stocks). This condition of rising prices, but a falling Money Flow line, is known to technical analysts as bearish divergence and indicates a weak market doomed to failure at some future point (barring an influx of money on the buy side to keep the rally going). Toward the end of the week after several days of price declines in the market, the pattern reversed and buying pressure was evidenced by a rising Money Flow line while prices continued to decline — a condition called bullish divergence by technicians. Finally, on Friday morning, the market made the cycle low we had been looking for and rallied back somewhat. Although QQQ did rally in price alongside SPY, the fact that its Money Flow line fell back toward its lows near the close casts doubt on the staying power of this rally in the QQQ.

At this point the only thing that's clear about the future course of the market is that it's awash in an unsettled sea, with cash moving out of the tech sector and, sometimes, into bluer chip issues. This is a sign of nervousness amongst fund managers, who tend to gravitate to more liquid blue chips because they can liquidate their stock positions in a hurry if need be. So, the positive flow of funds into the S&P 500's SPY is not necessarily all that bullish an indicator — it's more a sign of a nervous market with ``hot'' cash finding a motel to stay in for the moment, but not necessarily taking up long term residence.

During the last week of November, we registered a sell signal based upon our OEX sentiment indicator. Since that sell signal, the market has been under selling pressure while attempting to move higher but failing to do so. According to the Bradley Calendar, the trend should be expected to remain down into late December, with only a brief period of strength into the New Year, then a renewed decline in the First Quarter. This flies in the face of the seasonal tendency for the market to move higher in the October-April season, so there's a tug-o'-war between those two forces. Given the fact that stocks, especially tech stocks, are overvalued from a fundamental viewpoint, we think a move lower would benefit the market in the long run by making stocks more attractively priced.

Special warning to users reading this on Hotmail: Microsoft has been found to hijack links within email messages passing through their servers to redirect you to their servers instead, so the links in the message may not work correctly — if you encounter this problem, please visit your MyClues Home Page to reach the desired page instead.

There is a sector we've been spotlighting recently which has been gaining ground day by day. We discuss it and its bearish implications for the broad market and the economy on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro continues to hold near the top of the trading range. In our opinion this is a distribution top, meaning the Euro will soon embark on a sustained downtrend in price relative to the US Dollar.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The US Dollar Index continues to find resistance at the descending resistance polytrendline on the daily chart. As long as it continues to hold the long term violet-color support polytrendline on the weekly chart, the ultimate resolution of this trading range should be to the upside.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

Long term trend remains down.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

The test of the August high failed and the index is demonstrating clear bearish divergence, signaling trouble ahead.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

While continuing to hold the daily support trendlines, the weekly chart shows the A$ has still not mastered the long term downtrendline. Ultimately, the market will decide, but we think the decision will be to the downside.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

Although showing a bit more strength in the rally than we expected, the market succumbed to influence from the US stock markets last week and tumbled. In line with the other stock markets, we don't expect a near term bull market here to develop for several more months except for select stocks and sectors.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

The desultory trading range has broken down now and the market drooped below its bullish support line. We think there's a reasonable chance that this whole pattern is a contracting triangle now in its wave d to the downside. If that's the case, once this decline finishes (and if the Bradley is correct, that would be near the end of month), a wave e rally would top below the high of wave c (4224.80) and be followed by a plunge to new lows next year.

Bonds / Interest Rates:

See our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

After breaking long term support weeks ago, the CRB rallied up to retest the old support line from underneath. This process seems to be close to completing, with the deflationary trend set to resume. With the unemployment rate zooming over 5% last month — rising from 5.7% to 6% — the probability of further price increases in commodities from the consumer demand side of the equation is a dwindling percentage. The sharp decline in copper prices is just one of many commodities which are tumbling. Were it not for gold and oil, the CRB Index would be much weaker at the present time.

Format for printing. [Go back]

For Friday, December 6, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.96/1.38
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks:

With the trend now firmly down in the stock market, we expect a short term bounce very soon. On Thursday, there were tentative signs of such a rebound developing, with the ``lead dog'' indices beginning to firm up after leading to the downside all week. A 50% retracement of the fall to date would be a normal expectation, but given the seasonal uptilt to stocks this time of year, a full retest of Monday's high cannot be ruled out.

Sentiment supports a bounce back rally here, with the OEX pit turning neutral to slightly bearish and the QQQ traders switching from puts to calls (the latter have shown themselves to be much less of a contrary indicator than the former in recent weeks — in fact, QQQ volume may be tilted toward program traders positioning themselves ahead of stock transactions, making them a leading indicator of programs to come). We suspect that there will be some program buyers on the scene soon considering the weight of call dollar volume in the QQQ.

The market is still looking for direction, waiting for a catalyst to show the way. The seasonal rally has left the bulls in a fairly untenable position holding too much in the way of overvalued stocks.

Longer term sentiment continues to warn that this is not the beginning of a sustainable bull market, but rather a bear market rally designed to draw the crowd back into the stock market ahead of further declines. The Investor's Intelligence poll of advisors has never shown twice as many bullish as bearish at the beginning of a real bull market. Instead, those numbers are characteristic of a bear market rally. Real bull markets will climb a Wall of Worry, not a Slope of Hope, as this one is doing.

Some have pointed to good breadth, or plurality of gainers over decliners, as a sign of a new bull market. The best day since the October bottom occured last Wednesday in a shortened session just before Thanksgiving, a day which almost always sees the market rally. Even on the very best day of the rally, the ratio of advancing stocks to declining ones on the NYSE could only reach 3.8. If this were a real bull market, we should have seen a ratio of around 9.0 by now. If we were to see such great breadth, of course, we'd have to admit we're wrong about the bear market rally and join the bullish majority. Nothing yet indicates we are anywhere near that point, however.

Investors in the future are likely to look back on this ``Indian Summer'' of a stock market as the last, best chance they had to sell the stock market before the next big leg down.

Of course, there is that stock sector we mentioned yesterday, which did pretty well on Thursday. We think it's going to trend higher while the rest of the market heads lower. If you haven't read the prior day's comments, you can do so now on our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Thursday, December 5, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.37/0.89
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
If no response, use this one instead:
Alternate MyClues Home Page Link ("http://clues.dhs.org:777/cgi-bin/myclues?myhome=yes&member;[email protected]")

Stocks: Bounce Due

The market never moves in a straight line for long and a bounce is due in the declining trend. But, the severity of this correction has yet to sink in after weeks of soporific bear market rally. We say that because our sentiment gauge, even after several days of decline, still shows that option traders are blithely buying more dollars worth of call options that puts, betting that this is a dip worth buying, rather than a shelf worth selling. Such confidence in the face of a decline is a sign of complacency of the first order.

A bounce back rally here should demonstrate just how much conviction the bulls have. If the NASDAQ lead-dog indices are relatively weak, we can assume the recent decline was simply the initial leg down and that a much stronger decline lies ahead once the bounce is finished.

One sector has been doing great despite the weak broad market. We discuss it in our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Format for printing. [Go back]

For Wednesday, December 4, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.25/0.51
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Key Support Trendline Breaks

The two leading indices in this rally have been the NASDAQ-100 and the Semiconductor Index. Both of those indices broke through key support lines on Tuesday, confirming the trend is lower. We are currently on a short term sell signal in stocks based on bearish sentiment divergence as of the close last Wednesday.

An interesting shadow of the selling in NASDAQ occured earlier in the day. Put dollar-volume in the QQQ options jumped far ahead of call volume, and even ahead of OEX put dollar-volume as well. It is possible that program traders are using QQQ options to position themselves for profits ahead of anticipated program trades. We noticed unusually predictive activity in the QQQ call options in the runup to the early November elections. Instead of being a contrary indicator, unusually large dollar-volume in QQQ options appears to be indicative of program trading activity hours later in the day. Now, we're seeing the same type of activity in the puts, with a subsequent decline following. These figures are updated on our website throughout the trading day.

Interest in the gold stocks is picking up here (see the HUI and XAU charts, for instance). With international tensions rising along with the possibility of a meltdown in Japan (Japanese banks may have to sell US stocks and bonds to shore up their sinking foundations), the gold market is showing signs of being one of the few safe havens again.

For those who are familiar with spread and seasonal trading, we'd like to remind you of their excellent track record at this time of year (some have never shown a loss and this has been the case for many years after their 100% success rate was first publicized). We are working on a Spread Trading Special Report right now which we hope to publish in the next week or so.

Format for printing. [Go back]

For Tuesday, December 3, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.48/1.91
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: It's a Mania

To everything there is a season — and this one is wild and manic. Speculators are pouring almost twice as much money betting on further rally even though the market is heading lower. On Monday, the crowd continued to plunge headlong into the most speculative stocks — those either without foreseeable earnings or those with only modest growth ahead — the semiconductor stocks represented by the SOX. It's pretty clear that we're replaying March 2000 (the zenith of the Bubble) right now in terms of sentiment. Then, the speculators welcomed every dip as a buying opportunity and bought call options. They believed that trees can grow to the sky.

Unfortunately, trees didn't grow to the sky and most of the forest has since burned down. But, the speculators have decided that, after almost three years of unrelenting bear market, faith is back and the tech stocks are going to allow them to recoup their losses — between now and New Years' Day, of course! How any group of investors, after being so badly burned, can so easily believe that the semiconductor stocks will magically come back to life and revitalize their portfolios beggars belief. Then, again, alcoholics share those traits, don't they? Perhaps Greenspan's Twelve Step Program to reliquify the stock market is finally beginning to work?

Well, PE ratios in the hundreds — or, infinite — eventually will have their comeuppance when reality bites. Chances are the reversal which occured Monday was the last gasp of the bear market rally. The decline unfolded in a clear five wave move to the downside, which qualifies as a genuine downside trend. The last hour rally Monday was likely the final countertrend rally before a larger plunge to the downside.

Format for printing. [Go back]

For Monday, December 2, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.41/1.05
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Rate Increase

We're increasing our subscription rate to $79/year effective Sunday, December 1, 2002. We realize this is short notice, so we are going to allow you to signup (or extend your present term) at the old $49 rate until December 10th.

Five-year Renewal Bonus Book

While supplies last, you can receive a free copy of Conquer the Crash or Elliott Wave Principle if you subscribe for five years. See our Subscription Information Page to subscribe or extend your present subscription.

Stocks:

After our sentimental sell signal given on the close Wednesday, investors decided it might be a good time to take some profits on the bear market rally. Although ending the week in the black, profit-taking sent most indices to closing losses despite the favorable monthly seasonal and holiday tendency. We have found that the broad market tends to close up on the last trading day of the month 70% of the time. And, there is also a tendency for the Friday after Thanksgiving to see an up close in the blue chips. Since the market failed to live up to normal expectations, we can conclude this to be a sign that the top is behind us. The potential for new lows ahead is high.

Although the trend is now firmly down, the market may spend a few days forming a broadening top in the general price area it moved through last week. For further discussion of the stock market, please see our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro remains very weak and has now broken through its uptrend support line. A halfway retracement of its 2002 rise targets 93.67¢ — it closed Friday at 99.4¢.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The Dollar Index needs to break above the light brown polytrend resistance line in the daily chart to turn the trend up from here. Although this may very well be a bear market rally, it should exceed the previous high and engender bullish sentiment toward the dollar. A failure to break above that downtrending resistance line, however, would be extremely bearish for the US currency and the US stock market.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The Canadian Dollar remains in a broad trading range that is likely to eventually see the currency break through its bottom at 62.5¢.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

Friday was a Time Ratio High turning point, suggesting the Canadian stock market should have formed a top.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The Aussie Dollar broke above the downtrending resistance line, then closed a very volatile week below it. The battle is on between the bulls and bears, with jury out. The breakout was bullish, but the close below the line bearish.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

The marginal break of the resistance polytrendline helps target a bottom in the bear market for March 2003. The Australian market is now aligned with Wall Street in terms of when to expect a bottom.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

The FTSE is directionless, waiting for a catalyst to engender a trend.

Bonds / Interest Rates:

Bonds have been a source of funds for stock investors in recent weeks. The top in stocks should put an end to the bleeding from bonds. http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

The CRB Index appears to be working through an expanding triangle (or broadening top formation). This pattern implies that a much more volatile environment is building steam, with large swings in commodity prices (perhaps oil and gold?). As with all triangles, once the pattern is complete, a thrust rally should end the entire runup from October 2001.

Format for printing. [Go back]

For Friday, November 29, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.81/1.83
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: Sentimental Sell Signal

On very light volume, stocks rallied back on Wednesday in a fifth and final wave up in the rally from early November. This five-wave up move completes the wave C rally of an A-B-C
bear market rally which started in early October.

Sentiment is the most powerful and reliable technical indicator because it provides a snapshot into what the crowd is thinking. We like to see a ratio on the OEX gauge of better than twice as much money being bet on further rally to register an overly-bullish condition. We then look for a higher high in price to coincide with a lower reading on the dollar-weighted OEX sentiment gauge — a condition known technically as bearish divergence — to signal a condition where the market is at — or is in the process of making — a top.

That's exactly what we're seeing right now. On Monday, the OEX closed at 476.95, while the dollar-weighted call-put ratio closed at 3.22. On Wednesday, the index closed at 480.36, with the ratio closing at 1.81. In other words, the index made a higher high, but the indicator made a lower high, constituting a case of bearish divergence — thus a definitive sell signal from sentiment.

Numerous other indicators are pointing to a significant stock market top in this timeframe, including the Bradley Calendar, which projected a turning point this week, as well as a confluence of Time Ratio turning point projections for Friday, November 29th. Additionally, oscillators are overbought and moving to lower highs — more bearish divergence against new highs in price.

As if to underscore the importance of the current time period, the Australian All-Ordinaries rallied up to the downtrending resistance line which has provided a ceiling several times starting in May and most recently in August. The XAU Gold Stock Index is also testing support in the large contracting triangle formation which should lead to a powerful thrust rally. The HUI Gold BUGS Index has been relatively stronger than the XAU, which is bullish for gold price in general because the BUGS do not significantly hedge (sell forward contracts) their gold production. When a gold mining company hedges, it loses money when gold prices rise. The fact that the BUGS are stronger indicates the market is making a forecast that gold prices will rise in the future and benefit the non-hedged gold mining stocks.

We're at a critical turning point in the market right now. If a top is in place this week, or early next week, the stock market is likely to trend lower throughout the rest of the year and perhaps for the first quarter of 2003.

Format for printing. [Go back]

For Wednesday, November 27, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.17/0.61
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Mania Peaking

The manic urge to buy shares before they get more expensive seems to be cooling just a bit. However, the number of bears reported by Investor's Intelligence dropped to the lowest level of the year this week. Apparently, the belief that seasonals will protect the guilty is rampant among investors.

Will they be saved by the benevolent season? In most years, we'd have said ``yes'', but this is a bear market which takes no prisoners. Thus, the seasonals appear to be poised to disappoint this year, given the dominant 22-week trading cycle low due in the next few weeks.

Light holiday trading led to big pullbacks in the indices. The SOX Index, which remains in la-la valuation land, fell over 4%, but remains ahead 67.12% from its bear market closing low of October 10th. Does this all feel like the March 2000 top all over again? You bet it does.

Back in 2000, most observers were solidly in the ``buy the dip'' category, so any pullback was greeted with confidence that an opportunity to buy was at hand. In Tuesday's big tumble, more money continued to pour into speculative bets on the upside ($1.17 went into OEX calls for each $1 of OEX puts). This is the kind of sentiment which marks very dangerous territory for the bulls. If we do get a bounce back from Tuesday's dip, it would likely fail and lead to much more on the downside.

The stock market will be open all day Wednesday, closed Thursday for Thanksgiving, then open for only a half-session on Friday. The bond market closes early Wednesday and Friday (and is also closed all day Thursday). Have a Happy Thanksgiving!

Due to the light volume, traders are best advised to take some time to spend with families. Although the NASDAQ especially is near support, we think the trend has turned neutral at best (and very negative at worst), and in this low liquidity environment, the ability of floor traders to gun for stops is enhanced.

Note: Wintry weather caused intermittent connectivity problems with our webserver Tuesday and our redundant route had problems due to a name server outage. Hopefully, this double-whammy won't be repeated soon.

Format for printing. [Go back]

For Tuesday, November 26, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 3.23/2.99
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")
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Stocks: They Love That Dip

Welcome back to Bubble-land! We're so pleased all you investors have decided to rekindle those grand ol' days of stock price growth without any prospect of earnings!

That seemed to be the dominant emotion on Wall Street Monday as the crowd went into a frenzy betting on the upside. Our OEX numbers were well into overly-bullish territory, warning that manic emotions are at play now.

As one subscriber wrote,

``Bob,

One more SOX fact: the index represents 17 stocks. 8 have no earnings, one has a PE under 50, that is KLAC (KLA-TENCOR) at 46. Linear Tech, Maxim and Intel are under 60. XLNX is in the 604s. The rest are over 100 and some over 200.

And I saved the best for last, all those numbers are before today's 3.22% climb in the index.''

And, an alleged internal KLA-TENCOR memo sent to the Longwaves Forum Sunday evening stated that chipmakers like Intel, IBM and several Taiwanese companies were slashing equipment orders, with the result that, for the first time in its history, losses for KLAC were to be expected over the next four quarters.

Truly, the bubble is back. But, how long can it last?

We discuss the technical patterns which point toward a particular time when the market should peak in our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Monday, November 25, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.09/1.96
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=@@ ^HUI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Subscription Rate Increase

Due to increased costs of doing business, we are raising our full-year rate to $79 effective December 1, 2002. Despite the increase, Market Clues is still the best bargain around — by far — than any other financial newsletter or website.

The $49 rate is still in effect through November 30th. And, if you subscribe for 5 years ($245 at the old rate, $395 at the new rate) or longer, you will receive a free bonus — only while supplies last, though! — of either Conquer the Crash by Bob Prechter or Elliott Wave Principle by A.J. Frost and Bob Prechter. Please note that our 5-year rate is about what you'd pay elsewhere for only one year. To subscribe, click here to use PayPal (if you are reading this in plain text format, or prefer to pay by check rather than PayPal, visit "http://clues.dhs.org/sub.html" for further instructions).

Stocks: A Clear Path for Stocks Ahead

There are times when the path ahead in the stock market is clearly marked. And, there are many more times when that path is shrouded in fog. Fortunately, we are at a time when the path ahead is clear.

Reviewing the bear market rally: The market bottom in early October (8 Oct in NASDAQ, 10 Oct in the Dow), kicked off wave A of an A-B-C rally phase. Wave B consolidated the gains from the 6 Nov top and we are now within the final rally, wave C. Within wave C, the market is tracing out an impulsive five-wave move with wave 3 complete and wave 4 in progress. Wave 3 was relatively weak as third waves go, falling short of the net advance in wave 1. Since wave 5s are usually the weakest wave, it's very possible that we've seen the high price of the entire bear market rally already. Normally, wave 5 will move the market to a higher high, though, so it's more likely that we'll see a higher high this week, but don't count on it.

Timing. A tremendous confluence of timing indicators point to a turn this week. And, there is a very important behavior in the market which will help pinpoint the top as we discuss further in our Detailed Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro remains close to its recent highs, but, fundamentally, there is no reason for the Euro to be so overvalued. Interest rates are relatively high for a zone with such poor economic prospects, but appear to be the only thread holding this currency up.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The US Dollar Index has held within a narrow trading range for months, but given the potential for a rally in gold prices, is likely to break down soon.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The rangebound trading continues with a likely steep decline ahead once the bottom falls out.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

The TSE should find strong resistance at the August high (380.33) and turn down.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The A$ continues to struggle at the resistance line on the Weekly Cash Chart. The yellow polytrendline suggests some upward pressure could potentially continue for up to two more months, but the trend should turn down strongly at some point, relieving pressure on the Australian stock market and Australian exporters. It's very likely that the government is artificially levitating the A$ due to some unwise investments they made on the future course of the currency.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

The market is closing in on resistance at the brown polytrendline (just above 3000), which should provide a ceiling this week. Although the Australian market tends to be a follower of Wall Street, its recent relative underperformance may be a leading indicator if it turns down alongside NASDAQ, rather than the Dow.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

All of the stock markets are in basically the same shape this week: topping. In the case of the London market, the high is likely to be below the August high of 4466.4. This is an important market for all investors to watch: the London market often tops out before the blue chip US indices.

Bonds / Interest Rates:

Bonds continue in a long term bull market with corrections mostly due to strength in the stock market. With the stock market trend changing this week, the bond market should benefit from flight-to-quality buying. Note: extended comments will be found on our Extended Comments Page . . . http://clues.dhs.org/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com or http://clues.dhs.org:777/cgi-bin/myclues?trading=20&member=wcorney@keatepartners.com

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

The pattern in the CRB is a broadening top formation. Although this implies volatility, it also implies a significnat long term top is forming. This is bad news for the economy as it implies a return of the deflationary trend and recession/depression ahead.

Copper: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/hg_z2.4903.html&member=wcorney@keatepartners.com

Copper continued up last week and appears headed for the 62% retracement price of 74.67 basis December. Copper is a great leading indicator for the economy: if the 62% retracement price is exceeded, it indicates a strengthening economy.

Gold Stocks: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_hui.4903.html&member=wcorney@keatepartners.com

The contracting triangle is nearing completion. Is gold gearing up for a flight-to-quality rally due to some future event? It certainly looks that way. We shall soon see the outcome of this formation.

For an up to date list of the stocks in the Gold BUGS Index, see "http://www.amex.com/othProd/prodInf/OpPiIndComp.jsp?Product_Symbol=HUI".

And, for charts of — and ratings for — those stocks, visit your MyClues Home Page (links at the top of this page).

Format for printing. [Go back]

For Friday, November 22, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

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Stocks: Thrust Rally Continues

There's not a lot to add here after calling for a thrust rally and getting it. This rally is burning through much of the sideline cash and should burn itself out before long. Remember to watch for NDX and SOX to top first, a couple of days before the SPX and DJ.

It's very hot money levitating the market higher as brokers and money managers desperately attempt to drive the market to a higher close for the year as a whole. These managers are paid to earn money and are using various rationalizations to manipulate the indices. They've been doing this since early October to push the stock market up into the Election. Now, they've driving toward eliminating the possibility of a third straight year of losses in the Dow and S&P 500.

While they may temporarily control stock prices, they will eventually lose control. And, something they very definitely do not have control over is the possibility of a terrorist attack on the scale of 911. When that happens, these euphoric feelings will evaporate very quickly.

If you're long the market for the rally, be sure to keep very tight stop losses: this is, after all, a thrust rally, which means it will burn itself out very quickly.

Note: a discussion of when this thrust rally will burn itself out and produce the next major intermediate top continues on our Detailed Comments Page.

Format for printing. [Go back]

For Thursday, November 21, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

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Stocks: Lead Dogs Surge

Our lead dog indices, NDX (NASDAQ-100) and SOX (Semiconductors), have been telling us this bear market rally wasn't over. They have been leading since October 8th, bottoming two days ahead of the blue chips, and have been stronger all the way up as the
ETF 20-Day Heat Map illustrates (which the QQQ and IGW entries graphically illustrate).

In the prior update we said,

``Stocks on the short term continue to work sideways in what could be a contracting triangle in the wave B position (counting the October 10-November 6 move from Dow 7200 to 8800 as an overall wave A). This is short term bullish if the pattern works to completion because it could resolve into a thrust rally in wave C. If the short term pattern is a contracting triangle, we should get a complete pattern this week and an up thrust into Monday or Tuesday.''

The lead dogs jumped out ahead of the pack Wednesday as our Relative Strength Page illustrates — this page is a subwindow on our Trading Page, where it automatically refreshes itself every minute during the trading day. The lead dogs were clearly out in front despite the early selloff to test support lines, signaling that the market still had work to do on the upside. Here is a snapshot of the table taken during the final minutes of trading Wednesday illustrating these points:

Relative Strength ofCompared toStrengthQuote Age
NDXDJ  +2.29% 39s
NDXSPX  +2.12% 9s
SOXDJ  +5.16% 39s
MIDSPX  +0.18% 9s
SMLSPX  -0.13% 9s
VLESPX  +0.10% 9s

Despite the strength the lead dogs are showing, however, they will top out about two trading days ahead of the next intermediate top in the market. Consequently, with important turn dates due next week, we have to carefully watch for signs of weakness in the ``dogs'' to signal an important turn. That turn could be to a very strong resumption of the underlying bear market trend.

Format for printing. [Go back]

For Wednesday, November 20, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

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Stocks:

We hope you're enjoying Free Week at Elliott Wave International. If you haven't done so, the URL to sign up is
"http://www.elliottwave.com/a.asp?url=http://www.elliottwave.com/freeweek&cn;=mktclue".

The trading range, directionless stock market waffled around again on Tuesday, although a brief intraday rally sparked a bit of short covering in mid-session. But, the gains could not be sustained. The market is waiting for something to give it direction. Interestingly, it could have reacted badly to the news that Iraq has violated the most recent UN resolution and thus has invited the coalition to attack, but apparently, that bit of news had already been discounted by the market.

We are expecting this current period of narrowing trading range to be the calm before the storm. Low volatility regimes build up energy for high volatility once a spark ignites the crowd. We have several turning points due soon which point toward a big surge directly ahead.

Gold stocks sold off Tuesday as the narrowing trading range works slowly toward the day of reckoning. This market also confirms that a high volatility move is coming. With commercials short and speculators long, the smart money is betting that gold prices will be lower at some point in the future. However, that is a long term perspective and a short term thrust rally would be consistent with the longer term bear trend these stocks have been in for the last couple of decades. The timing of that thrust depends upon when the triangle is complete. That should be coming up in the near future.

Note: detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Tuesday, November 19, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

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Stocks:

The stock market completed five waves up Monday morning and started a retracement. We have been looking for a correction of normal proportions (38-62%) of the preceding advance at the very least, but it appears that the sideline money continues to flow into high tech stocks despite historic high valuation levels.

One confirmation of a more substantial top in place we would have liked to have seen: weakness in the NASDAQ-100 or Semiconductor Indices, our ``lead-dogs'' which typically put in tops and bottoms a couple of days ahead of the rest of the market. That didn't happen Monday and until it does the likelihood of a substantial retracement is greatly diminished.

The other item of note in an otherwise dull Monday session was the behavior of QQQ option traders. They started the day heavily buying put options (a bet that the NASDAQ-100 Index would go down substantially) — and they were right on the very short term. However, by mid-afternoon, they were buying call options (bets that the NASDAQ-100 would rise substantially). It has been conjectured by some that program traders are using the QQQ options to pump up some of their arbitrage profits. If that's the case, the rise in call buying is bullish. On the other hand, if speculators are buying the dip, that's bearish. Until we have more history of this option series, we can't make a definitive statement about this indicator. The action was very interesting, however.

Several indicators point to a top in this timeframe. However, those forward-looking indicators can be early and we need to have more coincident indicators confirming them before we can declare this bear market rally at an end. We do suggest that the longer the market spends in this price range, the worse the decline to come is going to be. Just as a long period of base building precedes a strong runup in a bull market, a long period of ceiling building precedes a strong decline in a bear market.

Format for printing. [Go back]

For Monday, November 18, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.35/2.16
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sox.4903.html&member=@@ ^SOX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

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Stocks: Range Trading

Last week unfolded very much as we described one week ago:

``If you're a short term trader, however, you're going to like this market because you like to play it from both short and long positions. There should be ample opportunities to do both in the coming months. But, if you're a longer term investor, you have to look for a narrowing trading range here until the Iraq situation is finally settled. And, that could be many months.''

That's exactly what we're seeing here on all of the major indices. The week began with a dip and ended with a flourish for the bulls as option expiration saw price manipulation of individual stocks to expire call and put options worthless. Some indices were weaker and some were stronger, so it's a mixed picture. Our ``lead-dog'' index, the NASDAQ-100 Index (NDX or QQQ), was relatively strong and hovered near its recovery high and a resistance trendline at the close of trading Friday. The Dow was mired in the range over two hundred points below its high of the previous week (8800). A glance at the 5-day relative strength report shows that tech sectors were leading. Such sectors as semiconductors, internet, software and networking put in net gains for the week. However, almost all daily charts on these sectors indicate that strength here is a fleeting proposition. That's because we're seeing bearish divergence as those new highs are not confirmed by corresponding highs on our oscillators.

Sentiment remains a roadblock to rally in the stock market. Our short term options-based sentiment gauges show far too much bullishness for the market to make big gains. Those figures are confirmed by longer term sentiment gauges such as Investor's Intelligence which reported that over half of all advisors are now bullish — that's more than twice the number bullish at the bottom last month! That's a huge swing in sentiment which cannot be discounted. Apparently, this bear market rally has had its intended effect on the minds of market watchers. If this were a new bull market (as we had hoped it would be), the bears would still be in the majority and would be vocally calling for a crash. Instead, the bulls are out in force, urging investors to buy before prices move much higher. That's not a sign of a bull market environment.

Note: further and more detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro couldn't make a new high on the failure of the central bank to cut rates after the US Fed cut short term rates the prior week. This failure to move to a new high is bearish for the currency and for the European economy. Is deflation ahead for Europe? It's looking more and more likely.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The US dollar spent the week recovering from the prior week's selloff on the Fed rate cut. Remember, the US Dollar Index moves almost exactly inversely to the Euro.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The Canadian Dollar is trapped in a trading range within a long term bear market. We expect a breakdown of the range will usher in a strong move to the downside.

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

The Canadian stock market showed strength in price last week, but the rally wasn't confirmed by our oscillators, suggesting very limited upside potential.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The A$ was not able to break through the long term resistance line in the weekly chart last week. As long as that trendline is honored, we continue to believe that the A$ will eventually plumb the lows (below 48¢).

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

The All-Ords continued weaker last week although it closed near the highs. The brown resistance polytrendline points toward a down cycle lasting into the end of the first quarter of 2003 and may be predictive that the new bull market may not get off the ground until after that timeframe.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

The FTSE has been stuck in a trading range below a resistance polytrendline that won't bottom until the first quarter of next year. Without a breakout, expect more of the same.

Bonds / Interest Rates:

Stronger economic news last week set bonds back late in the week, but the uptrend remains intact in bond prices. And, the chart of the CRB Index suggests strongly that the Fed is not finished cutting interest rates. In fact, cuts in the long bond rate are highly likely in the years ahead as the Fed buys bonds to stave off the looming clouds of deflation.

Last week, the government reported a huge jump in the Producer Price Index. The bond market reacted initially by falling, but recovered completely by the end of the session. It's clear that the numbers were a fantasy and the market's reaction reflects that. Remember, it's the market's reaction to news, not the news itself, that counts.

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

The CRB Index uptrend ended in late October as the uptrend support line was broken. The CRB is attempting to retest that uptrend line from underneath, but it appears that a much larger drop in commodity prices lies ahead. This is bad news from the point of view of deflation and suggests the Fed is not finished cutting interest rates.

Format for printing. [Go back]

For Friday, November 8, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Profits Taken

The market sold off as short term investors and traders took profits: it was buy on the rumor of a rate-cut and sell on the news of the real thing. And, of course, the levitation provided by the election campaign dissipated quickly as the glow of Republican victory faded and the market turned its attention to the economy.

And the economy is sliding down the hill still. It's clear that more stimulation is needed both by the Federal Reserve and by the Congress. Thus, the politicians will now work on making the tax cut permanent, lowering payroll taxes and, perhaps, tossing a bone to the market: eliminating double-taxation of dividends.

Although we believe this is a bear market still, we won't shun buying for a rally when and if we get the chance (detailed in our Detailed Comments Page).

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Thursday, November 7, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Republicans Take Congress

The campaign to rig the election paid off for the Republicans as they took both houses of Congress in the election Tuesday. Then, the Fed cut interest rates by ½ point, generating tremendous confusion in the markets. Does this action signal a panic on the part of the Fed? Does this mean a deflationary spiral has already started? If so, the recent rally in stock prices was on little more than hot air and hope. And, the bear market rally we've enjoyed is just about over.

We always try to listen to the message the markets are sending us. We also pay attention to the potentials. For instance, in July, we recognized an intermediate term bottom in the stock market which just might have been the bear market bottom. Once the rally was underway, however, we realized that it had all the earmarks of a bear market rally — because we listened to what the market was trying to tell us. Ultimately, the July lows were taken out in the next downturn.

Similarly, the October bottom was potentially the end of the bear market and the beginning of a bull market. So far, that hasn't been confirmed. In fact, it has most of the earmarks of a bear market rally like the August rally. Thus, when we listen to what the market is telling us, we are seeing what appears to be something similar to the prior rally: just another bear market affair ultimately leading to new lows in the major indices. Staying on the right side of the market — and controlling risk — are our goals.

Sentiment is wildly bullish right now according to our Dollar-Weighted Option figures. OEX traders went heavily toward the overly-bullish mark on Wednesday and the recovery into the close pushed them even further into the bullish camp.

After the cash stock market closed, the futures markets sold off, signaling that short term traders are saying they think we've seen the top in this move.

Note: further comments for subscribers only will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Wednesday, November 6, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Levitation Day

During this period of time when cycles are pointing down, it's quite an accomplishment for the Republicans to have levitated the market all the way into Election Day. We wonder if, perhaps, this might be a preview of future fiscal policy we can expect out of the Bush Administration going into the 2004 election.

The crash in the stock market over the past couple of years has taken much of the wind out of government sails. Not only has the Federal government suffered reduced capital gains and income tax revenue, but the states have as well. Those governmental units made the classic fiscal mistake: that is, just as a bull market makes everyone a market genius, rising tax revenues from the bubble market of the 'Nineties made the politicos think the largesse would never end. And, you know what politicians do with more money? They spend it, of course! Now that the revenues are falling and the economy slumped in a two-year recession (so far), the normal Keynesian solution (increased government spending to boost a sagging economy) can't be counted on. Instead, what we have are state governments cutting back on their expenditures to balance budgets — creating a drag when they should be stimulating the economy by spending more.

But, has the Bush Administration re-election team indeed found the Golden Goose of market manipulation? If they have, they have solved two problems with one solution. By boosting the stock market back into Bubble-land, they re-energize government revenue and spending, helping revitalize the economy. And, they make people richer and more prone to voting Republican in the next election.

No, we don't seriously think they can keep it up. This kind of manipulation can work for a few weeks in a seasonally strong period, but they aren't likely to be able to fool everyone all the time. But, you've probably noticed there haven't been too many folks complaining about this rally, have you? Strange how quiet the critics get when the market is going up!

In any case, economic reality is likely to set in no later than next month — we're still suffering through a recession. Near term, we're probably going to see the market sell off on profit-taking when the Fed meets today and announces they are cutting short term rates ¼%. Oh, there might be an initial pop fly rally, but it's likely to be sold heavily by the hedge funds. Unless we see large amounts of money going into the QQQ call options, we'll look for a 50% retracement of the October rally to get started no later than 2:15 p.m. EST Wednesday (that's when the Fed announcement comes out). The market should selloff into the weekend, put in a base and rally into the late November timeframe for an intermediate top. After that, things could get really strong on the downside for several months.

That is, unless the RATs have more tricks up their sleeves. We'll watch the indicators for signs they have found a more permanent solution to current levels in the stock market. Our working assumption remains that this rally is a bear market rally and that market indices are going much lower next year.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Tuesday, November 5, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Running Stocks Up The Flagpole

The US Treasury Dept ran the flag up the pole Monday — the Republican re-election stock market flag, that is. Money poured into overblown, overhyped and overvalued NASDAQ stocks and flowed out of the blue chips, a sign of concentrated buying by the Plunge Protection Team — in this case, the Republican Aid Team (RAT). Now you know why the market smelled that way!

Internals were poor, with barely more stocks advancing than declining. And, volume was very concentrated in advancing issues (i.e., those the RATs were buying): the Arms Index for NASDAQ came in at 0.25.

By mid-afternoon, most traders sensed that the RATs might have lost control and were in trouble — the market suddenly made a U-turn to the downside. By the close, the Dow Industrials had dropped 160.84 points off its high of the day, ending only 48.20 points off its low, but still up slightly from Friday's closing level.

The RATs need to levitate the market on Tuesday to keep the voters in a good mood when they go to the polls to vote for Republicans (or, so they hope — we think even the average voter has smelled a rat). So, we'll be looking for them to be buying Tuesday, especially in the NASDAQ-100 futures and options (watch the QQQ dollar-weighted option ratio for an indication of such activity). But, time is running out and so is the pattern: the rally from early October has taken on the form of an ABC — and it's almost complete now. Ideally, we should see a 50% retracement before any further rally. The RATs may have even used up most of the sideline cash in this rally, but we will have to see the nature of the retracement to judge whether we will get that rally into late November or early December.

Format for printing. [Go back]

For Monday, November 4, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.16/2.79
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: SOX on Fire

The Semiconductor Index (SOX) tipped the current rally and is moving higher. However, it has gotten far ahead of fundamentals and constitutes a reflation of the recent bubble. After falling over 85% from its all-time high, it has risen almost 50% in recent weeks. Is the rise over, or can we expect more? The answer to that question will tell us much about the fate of the market.

The stock market, in fact, is quite overbought and in need of a retracement (correction), but is likely to continue its upward trend for a few more weeks.

We have found that one of our indicators has been able to call almost every short term turn in the market recently. We were surprised because this indicator has been behaving exactly opposite to its historical pattern. Why and how this has happened is behind recent insider moves in the market. Although this new finding has greatest significance to short term traders, longer term investors may find it helpful to know how we can get an inside glimpse into the forces which move the market on a daily basis. This indicator is updated several times each trading hour on our Trading Page.

Other forecasting indicators, one of which has nailed every recent turn in the stock market, are looking for a near term reaction, followed by a strong move in the other direction.

Note: detailed comments which expand on the above (and answer some questions posed) will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Euro Currency: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ec_a0.4903.html&member=wcorney@keatepartners.com

The Euro rallied last week on the coming rate cut by the US Federal Reserve. However, this is likely to be the last fling to the upside for a long time to come. That's because the current rally is best counted as a thrust rally — and those don't last long before a trend change in the opposite direction. Near term, the rally needs to pull back slightly and we should see some retracement before a final high. At that point, the Euro is likely to resume its downtrend.

Commercial interests remain very bearish on the Euro, now holding 23,470 long contracts versus 67,459 short contracts on the Chicago Merc, an increase in net short position of 7894 contracts in just the last week. Who's long (bullish) the Euro? Small and large traders. That's hot money which can change position in the blink of an eye.

U.S. Dollar Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/dx_a0.4903.html&member=wcorney@keatepartners.com

The Dollar Index is moving exactly inversely to the Euro. It should test the prior low at 103.54.

Canadian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cd_a0.4903.html&member=wcorney@keatepartners.com

The rally appears to be over or almost over. The currency has not quite reached its prior high (which was a 50% retracement level of the previous leg down). Still bearish, with commercials holding 43,129 contracts short to 12,775 long — a substantial increase in their net short position over the preceding week (+7296).

S&P Toronto Stock Exchange http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sptse.4903.html&member=wcorney@keatepartners.com

The Canadian market is moving more in tune with European stock markets. The high on October 28th coincided with the high in the Dow and S&P 500, but the trading range in Toronto has much more of a downward tilt to it than the New York market. Still, we think a retracement here is healthy and we should see a return to rally within a week. But, watch the NY and London markets for leading indicators.

Australian Dollar: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/ad_a0.4903.html&member=wcorney@keatepartners.com

The A$ attempted to rally along with the Euro, but fell back on Thursday, returning to the long term trendlines which have characterized its bear market rally recently.

Commercials were extremely bearish the last time we mentioned them, but this week they reached new highs in bearishness. Commercials now hold only 2,837 contracts long versus 33,286 contracts short. That's an increase of 3270 net short contracts. Moreover, large traders do not hold a single contract short! Most telling of all for the coming crash in the A$ is the position of small traders: 21,075 long to only 3,240 short. When the hot money gets going, so will the A$ — to the downside. Which is, after all, good news.

Australian All Ordinaries: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_aord.4903.html&member=wcorney@keatepartners.com

Although caught in a trading range all week, the All-Ordinaries weren't able to make their high on Monday, October 28th — they peaked the previous Thursday, the 24th. Still, late week highs were within a few points of the prior week's high, so the pattern is close enough to the US market to suspect that we're only halfway through this overall trend rally from October 10th.
Australia Business News http://www.abc.net.au/news/business/default.htm
Yahoo! Australia Business News http://au.dailynews.yahoo.com/Full_Coverage/Australian_Economy/

London Financial-Times 100: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ftse.4903.html&member=wcorney@keatepartners.com

The FTSE has been much weaker than the US markets. However, we should point out that the London market bottomed well ahead of the US market, on the 24th of September versus the 10th of October. The retracement so far has erased almost half of the prior rally's gains. If the US market does the same, it would bode well for further rally thereafter. Watch the London market for an upturn — it may continue to serve as a good leading indicator for the other stock markets.

Gold Stocks: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=wcorney@keatepartners.com

The XAU has been bottled up in an overarching polytrend resistance line since June. Last week, the first sign of a breakout started appearing. This doesn't change the trend to up, however, and we'll need to see more strength to suggest an imminent uptrend.

Suggested reading: ``Gold Lives in a Cage'', a new article by Craig Harris of Harris Capital Management, Inc. CTA. Craig describes himself as a ``reluctant bull'' on gold. ("http://www.321gold.com/editorials/harris/harris103102.html")

Bonds / Interest Rates:

Bonds continue to correct their recent rally, but should provide an excellent haven from stock market weakness.

Target 2030 Zero Coupon Bond Fund Quote

Sectors and Individual Stocks (Subscribers Only)

For tables ranking sectors and individual stocks, and links to charts of 3500 individual stocks and sectors, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find a wealth of tools for selecting top sectors and stocks, including access to our exclusive realtime, intraday indicators.

For a 3-4 month free trial subscription, click here.

Commodities (Subscribers Only)

For complete charts of commodities, please visit your very own MyClues Home Page[http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member=@@] -- in the CHARTS & RESEARCH section of the page, you will find links to webpages containing links to the following:

For a 3-4 month free trial subscription, click here.

CRB Index: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=wcorney@keatepartners.com

Commodities are continuing to adhere to the long support line they've developed on both the daily and weekly charts. This continues to be an excellent argument against deflation.

Copper: http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/hg_z2.4903.html&member=wcorney@keatepartners.com

Copper punched through resistance at the prior 4th wave high and moved close to the 50% retracement price of 73.02¢ (the high was made on Friday at 72.9¢). Further resistance is at the 62% retracement price of 74.76¢. The jury is out on this one, but we still lean toward the bearish case: demand for copper depends to a large extent on the housing industry, which shows strong signs of slowing demand right now. We count the current rally as wave A in a bear market rally. Still, this rally is another good argument against deflation.

Format for printing. [Go back]

For Friday, November 1, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Hallowe'en Window Dressing

The buyers kept up the pressure to close the market at high levels on Thursday as the end of the best month of gains for the stock market since January 1987 came to a close. The bears are ready for the ride down, though, and were selling every intraday rally attempt. The QQQ traders, who may have inside information to guide their purchases of NASDAQ-100 options, were heavily pouring money into puts (bets the market would go down). We have noted recently that these option players, unlike their OEX cousins, are more often correct than wrong.

We're in the middle of what would normally be the Monthly Buying Spree, but recent activities seem to have sapped much of the buying strength early (sort of like the 0% auto financing offers sapped much of 2003 buying strength for automobiles).

We put cash to work Wednesday and bought bonds for the short term, awaiting a big buying opportunity upcoming in stocks if we get that big retracement we're looking for.

Note: detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Thursday, October 31, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Very Toppy Market

The market moved higher Wednesday as end of month buying pressure helped the market recover. However, due to a number of technical factors, this rally probably has made a near term ceiling and the beginning of a stiff decline into mid-month.

We emailed subscribers to our Notification List (a self-service list which can be found on your MyClues Page on the Special Reports header bar) and liquidated our holdings Wednesday afternoon in order to assess our next move. As we like to say, ``When in doubt, get out.'' It's something most investors should do. It's always better to view the market from a stable platform, such as cash, to get a good perspective (it's especially good to be able to view the market from cash when you've just taken a good profit!).

The Bradley Calendar has now (almost assuredly) nailed the last four turns in the market, the latest being Monday's high. The next turn in that calendar comes little more than a week from today, so we are likely to find a good buying opportunity in the near future.

We're counting this corrective wave as B, the middle down wave within an ABC rally which started in early October. Once wave B bottoms and wave C begins, the upside should be explosive. Until that buying opportunity comes, however, we're play defense in this overall bear market rally — even if we do think a 50% rise off the October low is very likely.

Note: detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Wednesday, October 30, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 0.67/1.05
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: A Sentimental Turnaround

Tuesday has a reputation of being a turnaround day and this one proved to be a double turnaround. Initially, the market sold off on the plunge in consumer sentiment. Now, consumer sentiment is a lagging indicator and with the economy moving into its third year of recession, that segment is throwing in the towel. That shouldn't have been news to the market, but it caused a huge plunge.

What happened was that buyers cancelled their bids for stocks and the hedge funds came in to sell stocks short. With no buyers, the vacuum under the market created a big downdraft.

Later in the day, the selling pressure dried up and the buyers returned, sending the market right back up to a positive close. In other words, lots of sound and fury with no substance whatsoever. But, that's the nature of the market right now as the correction which started after the 16th continues. We expect it to continue for another week or so, but we also expect a higher high in the next few days as the Monthly Buying Spree shifts into high gear.

Despite an expected dip to retrace some of the Oct. 10-16 rally, we expect much higher prices on the indices for quite a while to come.

Note: detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Tuesday, October 29, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: See Website
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_vle.4903.html&member=@@ ^VLE · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_rut.4903.html&member=@@ ^RUT · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_sml.4903.html&member=@@ ^SML · http://clues.dhs.org/cgi-bin/myclues?chart=/:/futures/d/cr_a0.4903.html&member=@@ ^CRB · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_xau.4903.html&member=@@ ^XAU · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_btk.4903.html&member=@@ ^BTK · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_tyx.4903.html&member=@@ ^TYX
Sector Performance Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago
Sector Acceleration Since: 8 Apr 1999 · 18 Oct 1999 · A Week Ago · A Fortnight Ago

MyClues Home Page Link ("http://clues.dhs.org/cgi-bin/myclues?myhome=yes&member;[email protected]")

Got Stocks? Do you have money in the stock market? If so, you need to read this valuable excerpt from Chapter 20 of Bob Prechter's new book, Conquer the Crash. By now, you should be familiar with Bob's long-term forecast for stocks - namely, there's still a LONG way to go in this bear market. In this excerpt, Bob offers advice on stocks, mutual funds, short-selling, diversifying, and more. To be fully prepared for the bear market, you need to read all of Conquer the Crash and act on Bob's advice. But, the information you are about to read is a great start.

Stocks: Pre-Spree Weakness

The market couldn't advance Monday with the weight of too many bulls on its back. More than twice as much money went into upside bets in options and that helped drag the market lower.

However, we have leading sectors which are still working their way higher. These leading sectors are still extremely oversold on a long term basis and have good potential to rise over the next month.

Because of the potential for a deeper pullback later in the week, we may switch between stocks and bonds at some point this week (if you are on the Notification List, you will receive an email notification — this is a self-service email notification list you can add yourself to and delete yourself from by clicking on the links in the Special Reports header bar on your MyClues Home Page). This is especially the case because the Bradley Calendar warns that Monday the 28th of October marks the center date for a minor trend change (a turn down in this case) and a move lower in the 8th of November. We need confirmation from our coincident indicators before switching, however.

Note: more detailed comments will be found on our Detailed Comments Page.

Fixed Income Exchange-Traded Funds: We have summarized the fixed-income exchange-traded funds in this page ("http://clues.dhs.org/clues/fixedincomeetfs.html"). These make a good place to invest during weak periods in the stock market. They have the advantage of stocks (they can be traded when the market is open) and move in the opposite direction.

Format for printing. [Go back]

For Monday, October 28, 2002
© Bob Carver
$-Weighted OEX/QQQ Call/Put Ratios: 1.61/1.15
Popular Indices: http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_spx.4903.html&member=@@ ^SPX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_compq.4903.html&member=@@ ^IXQ · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_ndx.4903.html&member=@@ ^NDX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_dj.4903.html&member=@@ ^DJI · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_mid.4903.html&member=@@ ^MID · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_oex.4903.html&member=@@ ^OEX · http://clues.dhs.org/cgi-bin/myclues?chart=/:/indices/d/_nya.4903.html&member=@@ ^NYA ·