“The Chicago purchasing managers index rose to 55.6% in January, to mark the best performance in nine months. Economists surveyed by MarketWatch had expected the Chicago PMI to edge up to 49.8%. Any reading above 50 indicates expansion. Details of the report were also strong. New orders posted the biggest increase in 10 months, advancing to 58.2% from 50.4% in December.” Full story at…
http://www.marketwatch.com/story/chicago-pmi-climbs-to-556-in-january-2013-01-31-9915813?link=MW_latest_news
While the doomsdayers suggest the end may be near, today’s Purchasing
Manager’s Index suggests that it isn’t now.
On the other hand, Wave Theory says it’s sooner than later.
WAVE PATTERNS SUGGESTS 3RD AND FINAL WAVE UNDERWAY
“..in the midst of all the bull celebrations, let's not forget that the
2000 top was 1553 SPX, and the 2007 top was 1576 -- and these were major market
tops. If you draw a trend line connecting the two, you come up with a figure
just north of 1590.” Discussion at...
http://www.minyanville.com/business-news/markets/articles/Bulls-Still-Have-the-Ball-bearish/1/28/2013/id/47641#ixzz2JHfXkQ96
COMMENT FROM A TRADER: “The way the market has been
exuberantly bullish, I've been just waiting for that high volume blowoff top to
mark an end to it all...but it never comes. I have to keep reminding myself the
fed is simply pumping too much for this to end. I can't remember how long it's
been since we've seen a futures down 400 point day, but I can tell you this, I
do recall a time when if you would have seen an unexpected negative GDP
announcement, you certainly would have seen a major selloff. Nothing seems to
matter any more which is why I refuse to sell until it's TIME to sell.”
COMMENT FROM A BIGGER TRADER – BILL GROSS, PIMCO,
MANAGING DIRECTOR
“Investors
should be prepared to accept "lower returns on bonds, stocks, real estate
and derivative strategies," Gross wrote in his monthly letter entitled
"Credit Supernova!"…Championing something of a bunker mentality,
Gross told investors to buy Treasuries with shorter durations and
buy gold or other investments that "you can sink your
teeth into."… "the end of the global monetary
system is not nigh," but says we're approaching a time where
"investable assets pose too much risk for too little return." Story
at…http://buzz.money.cnn.com/2013/01/31/bill-gross-markets/?iid=Lead
MARKET RECAP
Thursday, the
S&P 500 fell 0.3% to 1,498 (rounded).
VIX fell 0.3%, to 14.28.
Volume has been
declining for almost a year and is down about 10% from year-ago levels. That trend looks like it may be breaking, at
least is has been increasing in January, and that would lend some credence to
the theory that the markets can go higher.
Most seem to think the markets can go higher, but maybe not too much
higher.
There has been
late day selling recently suggesting the pros are lightening up on stocks.
NTSM
The NTSM analysis
remained HOLD Thursday.
Of the indicators
that actually signal buy, sell, or hold in the NTSM analysis, only Price is
positive and it has been is falling fast over the last 3-days. All other indicators are neutral.
I keep daily
stats that track the size of moves in terms of price and volume. When the market is getting complacent there
is very little volatility and one of my statistical alarms goes off. This alarm is an advance warning of a
top. One flashed today. Looking at this signal, over the past 3-years
this signal has flashed 6-times before a top.
(Over those 3-years, it has never missed a top; it has never given a
false warning of a top.) The most advance warning was 34-trading days; the
least was 4. The average was
17-days. So this signal says, on
average, we have about 3-weeks to a top. The tops have preceded corrections that have
run from 7% to 19% declines with an average of 13%.
MY INVESTED
POSITION
Based on a BUY
signal 7 of 9-days, and more importantly, consecutive closes above the prior
high of 1466, I moved into the stock market at 1471 on the S&P 500 on 14
January. I am currently invested in a
range of near 50% invested in stocks. 
