Bloomberg
(Wednesday, 22 Feb 2012) : Stocks in Europe Decline After Worse-Than-Expected
PMI Data: European stocks retreated for a second day after a report showed
services and manufacturing output in the euro area unexpectedly contracted in
February. Story at: http://www.bloomberg.com/news/2012-02-22/european-stock-futures-are-little-changed-klepierre-accor-may-be-active.html
“Unexpectedly
contracted”? Who’s surprised? We
suggested that Europe might already be in recession weeks ago.
On
Wednesday I threw up a chart and suggested that the lower trend line had been
broken and I expected that a new trend-line would be reset lower by a few
percentage points so that the new channel would be about 5% high. So far that has not happened. Instead the S&P 500 bounced off the
current trend line (shown red in Wednesday’s blog) and is continuing up. That just means the market remains very
optimistic. I won’t complain about that,
though it’s anybody’s guess how long it will last.
S&P
500 was up 2pts to 1366. VIX was up 3%
to 17.31. It would appear that the
options boys can’t make up their minds since VIX has bounced up and down over
the last several sessions. Even so, our
VIX indicator is still a buy.
Today,
Friday, the overall NTSM analysis remains BUY.
I
bought back into the stock market at S&P 500, 1155 on 7 Oct after the 6 Oct
NTSM buy signal. I remain 100% long in
the long-term portfolio (100% stocks in the 401k.). (See the page “How to Use
the NTSM System” – the link is on the right side of this page).
Just a reminder: 100% invested in stocks is way too much for most rational folks. Don’t do it unless you have a high tolerance for risk.
