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At the end of last week we had a G20 statement which was long on words but short on action. The IMF followed on Saturday with another statement in the same manner. IMF head Christine Legarde held a news conference which was frankly useless but typical as these things go. Her most significant answer came from a question posed by a Greek reporter: "What will the IMF do with these demands should there be great social unrest in Greece?" Her response: "Implementation, Implementation, Implementation." (This statement meant previous agreements must be taken seriously.)

The WSJ was kind enough to

post a description

of just what's going on as to the calendar and conditions in simple terms. The three primary Greek agreements include "slashing pensions" ("implementation" = riots); cutting public sector jobs ("implementation" = bloodshed) and raising taxes on the poor ("implementation" = all out war). Further, whatever actions are to take place will be strung out over the next few months as in "buying time". The odd thing is so-called "troika" is going to give Greece its October payment even with the likelihood they may not get any more money in November.

Asia markets Monday saw this for what it was and sold-off. But Europeans were more hopeful and bid their oversold stocks higher. U.S. investors (whoever is left) took the bait and rallied stocks erratically with a dramatic short squeeze into the close. What's not to like about this situation? Well, we'll just have more drama and events strung out perhaps through the end of the year. That'll sell more soap and keep everyone on edge.

U.S. investors liked the big stock buyback plans from Warren Buffett as he creates more wealth for himself which he can perhaps give to the Treasury since he seems so inclined. His action conveyed the message to HFT algos that stocks were cheap. That got the talking heads to repeat the "stocks are cheap" mantra and even got them to cheer Dow 11K again.

Gold and silver continued to slide but rallied off their lows. Base metals rallied some which helped the materials sector (still in a bear market) rally. Even a rumor that Apple (AAPL) was going to cut back on iPad production hit that stock for a bit only to see investors seeing any dip as a buying opportunity.   

Amusingly perhaps is the SEC is contemplating a

civil action against S&P

for its previous poor ratings performance on CDOs, and I just can't but think this is political payback from the administration. Silly me, eh?

Bonds saw significant profit-taking from last week's gain. And, you'll never guess what technical indicator indicated this--DeMark. Further, weekly DeMark 9s littered European stock ETFs like EWG and EFA for example indicating "buy to close short" positions if you had them.

Volume was modest making the short-squeeze relatively easy for HFTs. You won't hear many complaints about these programs when markets rise. Breadth per the WSJ was quite positive.

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Continue to U.S. Sector, Stocks & Bond ETFs

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Continue to Currency & Commodity Market ETFs

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TheStreet Recommends

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Continue to Overseas Sectors & ETFs

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The

NYMO

is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

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The

McClellan Summation Index

is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.

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The

VIX

is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.

Continue to Concluding Remarks

Monday was a classic short squeeze and with equity market correlations high DeMark instructed us to stay away from the short side and even close bond positions. We follow this advice.

There wasn't much in the way of bullish news beyond Buffett's stock buyback plans. Further, if anything, news from Europe was a nonevent with lots of pretty statements but no concrete action. Worse still was the idea that "fixes" are going to be dragged-out.

Tuesday will feature Case-Shiller Home Price Index and Consumer Confidence data. Further just about every day a Fed governor is scheduled to speak and jawbone markets.

Let's see what happens.

Disclaimer: The ETF Digest maintains active ETF trading portfolio and a wide selection of ETFs away from portfolios in an independent listing. Current positions if any are embedded within charts. Our Lazy & Hedged Lazy Portfolios maintain the follow positions: SH, EUM, EFZ, VT, MGV, BND, BSV, VGT, VWO, VNO, IAU, DJCI, DJP, VMBS, VIG, ILF, EWA, IEV, EWC, EWJ, EWG, EWU, EWD, GXG, THD, AFK, BRAQ, CHIQ, TUR, & VNM.

The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell any security.  Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period.  Chart annotations aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at

www.etfdigest.com

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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Dave Fry is founder and publisher of

ETF Digest

, Dave's Daily blog and the best-selling book author of

Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management

, published by Wiley Finance in 2008. A detailed bio is here:

Dave Fry.