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The Most Boring Expiration 'Ever': Dave's Daily

Well, the joke's on anyone (myself included) hanging around looking for some excitement. It was like watching a tie soccer game with no shots on goal.
Author:
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You remember being around for Y2K disruptions that never happened? How about all those in Hawaii waiting for the tsunami to hit in February that never came? Well, there was a lot of tension among us amateurs for this expiration non-event.

Why did I wait around for this? We could've gone golfing, swimming or even pub-crawling with BP's CEO Hayward now that he's got his life back.

It's like some sort of joke where most pit traders are doing fun stuff having done most of their damage early in the week. Oh well, this is what happens to mere shills in the game.

Volume (which was supposed to be spectacular) was beneath pedestrian--as in ultra-low. Breadth was marginally positive.

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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. We're a little overbought 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. You can see now accumulation is occurring again.

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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. Da Boyz squeezed the FEAR right out of them.

Continue to Major U.S. Markets

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SPY:

Let's just say I'm not a big H&S aficionado but you can see the current pattern plainly on weekly and even daily charts.

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MDY & IWM:

A pathetic end to the week.

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QQQQ:

Tech continues to lead the overall market higher on the back of semi's and Apple. Everything else is just tagging along for the ride.

Continue to U.S. Market Sectors, Selected Stocks & Bonds

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AAPL & SMH

: These are the two tech giants leading the way forward--the first with innovation, the second for the parts.

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XLF:

Is the reform moving through congress just for show? If yes, that's the reason for the uptick here.

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XLB:

Up on the week but with little enthusiasm.

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XLY:

Retail sales dropped but consumer confidence was up a little. Maybe those feeling better are all working for the government and the rest are busy paying down debt. We're living in strange times.

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IYR:

The demographics of Old Europe, Japan and the U.S. don't favor stocks as folks seek income for retirement. They chase yield at their peril.

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XHB:

Homebuilders suffer with the loss of the tax credit and, as always, they must continue to build and sell despite the inventory build.

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DVY & PSK

: Investors can find higher yields in a variety of ETFs but you'll find the underlying companies to be similar with most in financials.

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IEF, TLT & TIP:

The "maestro", Alan Greenspan, chimed-in today suggesting the debt financing requirements were unsustainable and impossible to meet. I. Did. Not. Know. That.

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Continue to Currency & Commodity Markets

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TheStreet Recommends

$USD/DXY & FXE:

The dollar was overpriced and euro oversold. The point one must ponder given difficulties in both regions is, why any difference? Since most don't believe there really is any they buy gold.

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GLD. GDX & SLV:

Off to the races once again. Gold stocks are choppy and hard on us trend-followers. If the stock market should fall sharply and gold did little, gold stocks would fall with the former. Silver, the poor man's gold, also has industrial uses but is more volatile than gold and more difficult to deal with.

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DBC:

Commodity prices are coming off their lows with the falling dollar but certainly not because of greater demand.

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$WTIC/CRUDE OIL:

Oil spiking as the dollar falls and we head to a big driving week ahead.

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XLE, BP & UNG:

The energy sector presents a messy looking chart due to the commodity-like nature of the sector among other things, not the least of which is ongoing poor energy policies.  UNG broke out of it's long descent as many hoped the administration would embrace it. That didn't happen but the attractiveness is more obvious.

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DBB:

Base metals are extremely important and their decline this week, especially after a strong rally the prior week, means slower economic growth ahead one would think.

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DBA:

Agricultural commodities are rallying within the trading range due to a falling dollar and rapidly rising prices for softs (coffee, cocoa and sugar).

Continue to Overseas & Emerging Markets

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EFA:

Everything is just fine in Europe now. Thankfully, all the problems have been fixed and financed. Whew!

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EEM:

Up with commodities and a short squeeze.

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EEB:

The BRIC's are all I have time for overseas as we wrap up this quiet quad-witching.

Continue to Concluding Remarks

Well, the joke's on anyone (myself included) hanging around looking for some excitement. It was like watching a tie soccer game with no shots on goal.

What was accomplished this week? Markets melted-up on ultra-light volume allowing GS to place some IPO's, notably CBOE. The fundamental background was a litany of bad news which was ignored.

The positive from the week was the ongoing belief among bulls that interest rates will remain low keeping the punchbowl in place for traders.

In the meantime, many investors are leaving the markets in droves as redemptions rise. Curiously, money market withdrawals are continuing meaning investors (mostly retail) are taking money out and using it to pay down debt (low Retail Sales data) buy gold and bonds.

Next week we get plenty of the usual data plus Wednesday's FOMC interest rate decision.

Let's see what happens. You can follow our pithy comments on

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Disclaimer: Among other issues the ETF Digest maintains positions in: GLD, UUP, EFZ and EUM.

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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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.