“…interest rates...have climbed despite the Federal Reserve's efforts to keep them exceedingly low…Along with the late-year stock rally came a rise in the 10-year Treasury yield to 3 percent, a number that could serve as an important test for whether the rally will continue.” CNBC video at…
http://www.cnbc.com/id/101298928
MARKET REPORT
Friday, the S&P 500 was down fractionally to1841 (rounded)
VIX rose 1% to 12.46.
10-year Treasury Note closed at 3.01% yield.
(Doug Short has detailed Treasury Yield history at…
http://advisorperspectives.com/dshort/updates/Treasury-Yield-Snapshot.php)
NYSE Volume was about two-thirds that of a regular day.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks advancing rose to 61%
at the close Friday. (A number above 50%
for the 10-day average is generally good news for the market.)
New-highs outpaced new-lows Friday, leaving the spread
(new-hi minus new-low) at +181 (it was +295 Thursday). The 10-day moving average of change in the
spread remained +41. In other words, over the last 10-days, on average, the
spread has increased by 41 each day.
Market internals improved again and remain positive on
the market.
Market Internals are a decent trend-following analysis of
current market action, but in 2013 (so far), if I had been buying the positive
ratings and selling negative ratings I would have under-performed a
buy-and-hold strategy.
NTSM
The 5-dMA of sentiment remained
82%-bulls in the Rydex/Guggenheim long/short funds I track. This is an incredibly high value and the
5-day sentiment value was the highest I have ever seen (data back to 2003).
High sentiment is a negative indicator for the stock market – but it hasn’t
stopped the market all year.
The S&P 500 dropped to
9.8% above the 200-dMA and a value of 10% has led to small pullbacks in 2013
(and corrections in 2011 and 2012).
Other indicators are all neutral of positive.
The most recent BUY signal for the NTSM system was 25
October. The “5-10-20 Timer” switched to
BUY from HOLD on 18 December.
MY INVESTED POSITION
I am about 30% invested in stocks as of 20 December
(S&P 500-1540) because I upped my stock holdings by 10% on the 20th. I will income-average (a little each month)
into the stocks to get my %-invested up to around 50% (max for me now) unless
there is a correction that would allow me to move in sooner and at a higher percentage. I expect the markets to pullback in the first
quarter of 2014, but it remains to be seen whether it will be another small
buy-the-dip event or something more.
