Today, the S&P500 bounced because the mini Greedometer readings for the week would have been considerably below the now well-established baseline had the week closed near this morning’s level. The S&P500 was oversold and had to bounce. Previous examples of mini Greedometer sequences for 2007-09 and 2011: When mini Greedometer readings approach/attain the baseline or topline for the sequence, the S&P500 reverses direction. That’s what […] Read the rest of this entry
Greedometer 2.0 The Rats Are Jumping Ship will be downloadable for free on Monday June 10th (2013). Here’s the link on Amazon.com: Greedometer Book.
If today sees the S&P500 close at/above 1605, the 50-day moving average test will have been passed –or at least not failed. Tomorrow we’ll see if there’s any follow through. I suspect there will. The topping-out process always takes longer than you think it will (or should). Look for the next S&P500 mini rally to be anemic on volume and momentum, and to be […] Read the rest of this entry
Last week saw the second highest buy climax reading -probably ever- but certainly in the past quarter century. A weekly buying climax occurs when a stock hits a 52-week high price, but closes the week at a lower price than where it began. Conversely, a weekly selling climax occurs when a stock hits a 52-week low and closes higher for the week. Weekly buying […] Read the rest of this entry
It’s official. The NYSE just released margin debt figures for April. A new all-time high was reached: $384.37B. This eclipses the previous all-time peak of $381B in July 2007. Take a good look at the chart because when margin debt peaks, the S&P500 is usually not far behind. I had used $383B for an April estimate in the Greedometer algorithm, so this won’t […] Read the rest of this entry
The past 2 months -and especially 2 weeks- have seen a rally in risk assets to new record-setting highs. But it has the finger-prints of a short-covering rally. The graph shows the Put/Call ratio for OEX 100 options (the OEX100 being the index for the largest 100 U.S. publicly traded company stocks). The data is weekly. OEX values are an average for the […] Read the rest of this entry
Don’t look now, but Ben Bernanke is warning about excessive risk taking in financial markets, and the use of leverage. Ben is apparently watching for signs of bubbles in asset markets. “In light of the current low interest rate environment, we are watching particularly closely for instances of ‘reaching for yield’ and other forms of excessive risk-taking, which may affect asset prices and their […] Read the rest of this entry