By Mark
Hulbert, MarketWatch
CHAPEL HILL, N.C. (MarketWatch) – “Contrarians believe that a correction in excess of 10% is unlikely anytime soon. That's because there is little evidence of the stubbornly held bullishness that is the typical hallmark of major tops. Investors may worry about a replay of the serious market breaks that began in each of the last two years around this time of year, but at least from a sentiment perspective, there is little similarity.” Full story at…
http://www.marketwatch.com/story/major-correction-unlikely-2012-05-09
CHAPEL HILL, N.C. (MarketWatch) – “Contrarians believe that a correction in excess of 10% is unlikely anytime soon. That's because there is little evidence of the stubbornly held bullishness that is the typical hallmark of major tops. Investors may worry about a replay of the serious market breaks that began in each of the last two years around this time of year, but at least from a sentiment perspective, there is little similarity.” Full story at…
http://www.marketwatch.com/story/major-correction-unlikely-2012-05-09
I agree this does not now look
like a major top.
MARKET
The S&P 500 was DOWN
0.67% Wednesday to 1355. VIX rose 5% to 20.08.
On 6 March the S&P 500
made a short-term closing-low of 1343.
Very much like yesterday, the S&P 500 bounced off the 1343 level
around 11 this morning and moved up from there.
Today’s rally gave up around 2 PM.
Volume picked up in the last hour as the market sold off about 10 pts.
Intra-day, the S&P 500
has held the 1343 level twice, and the S&P closed at 1359 on 10 April,
about where it is now. It is not at all clear
that the S&P 500 will head lower at this juncture, but the data (volume and
other market internals) don’t look good enough to say this correction is over.
NTSM
The NTSM analysis shifted
to SELL today, Wednesday.
Frankly, I have had a hard
time tonight deciding what to do. On the
whole it looks like the market will probably go lower, but maybe not much
lower.
The market is now only 6%
above its 200-day Moving Average and I still don’t see the S&P 500 going
much lower than that (another 6% down from here), but perhaps I am being complacent. This could be the calm before the storm and
it is certainly possible that tomorrow will be a big down day.
I decided to sell tomorrow
to 30% invested in stocks in the long term portfolio. I could wind up getting whipsawed (with a
quick buy signal soon) but that wouldn’t be so bad. At this point, I think it is better for me to
be safe than sorry. At 100% invested, it’s
simply too much risk at this juncture.
As I write this, it looks
like the futures are improving so there might actually be an up day tomorrow. That’s OK – I’ll make more on the sale.
MY INVESTED POSITION
I bought back into the stock market at S&P
500, 1155 on 7 Oct after the 6 Oct NTSM buy signal. I will reduce my stock holdings to 30% long
in the long-term portfolio on today’s SELL signal. (See the page “How to Use
the NTSM System” – the link is on the right side of this page).
