STRUGGLING TO THE FINISH LINE
Most economic news today (Jobless Claims, Chicago PMI and Home Sales) was, ahem, "better than expected"; still, that didn't spark any determined buying. Maybe without any POMO Thursday trading desks were running on empty.
2010 was an interesting year with lots of erratic behavior but a Fed "stick save" in the end. Flash Crashes, elections, tax issues, spending, unemployment, POMO and home prices were all center stage. Now you're probably expecting some sort of forecast from your humble pundit, but alas, all I can offer are three basic tenets to follow:
"The best laid schemes of mice and men go often askew."
Or, if you prefer:
"The best laid plans of mice and men often go awry"
"If you must forecast, forecast often."
Economist Edgar Fiedler (ETF Digest Sacred Cow IX)
ETF Digest Sacred Cow X
You were expecting Dow 20,000?!?
Volume Thursday did improve a tad and breadth was flat.
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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.
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.
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
Yes, this post is short since markets offer little to comment on. So let's just wrap this up and wish you all a Happy New Year! I doubt there will be a posting Friday.
Let's see what happens. You can follow our pithy comments on
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Dave Fry is founder and publisher of
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