“The stock market has
done nothing this year.”
Above heading reflects the sentiment of most investors
today. Bombarded by the endless black headlines, investors continue to fret and
sweat fearing that the market will reach new lows. Clearly, these are the
professional S&P watchers and know nothing about “the market”. Little do
they realize that last Friday, the following Advance-Decline Lines hit record
highs again: SPX, NDX, MID-CAP, and SMALL-CAP. More importantly, the NYSE
Advance-Decline Line Cumulative and the NYSE Common Stock Only Advance-Decline
Line also closed at new record highs along with the Cumulative Advancing
Volume-Declining Volume Index. These internal measures reveal the real health
of the market and are far more informative and hence, more important than the
S&P. What these indicators are telling investors is that “the market”
bottomed in early February as I’ve said and the bull market has resumed.
Moreover, as the market has yet to register overbought readings and sentiment
if far from euphoric, short-term risk is limited and further gains lie ahead.
When the major market indices reach new highs, the horses are long out of the
gate as they already have.
Leon Tuey via Jeffrey Saut
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