NEW YORK (TheStreet) -- The solid start for U.S. equities in 2013 is surprising given overvalued fundaments. Even with this near term market strength, my theme for 2013 remains that stocks are a risky asset class. If the Dow Jones Industrial Average ends this week above my quarterly risky level at 13,668 the upside technical momentum continues as stocks become even more overvalued fundamentally and more overbought technically.A warning that stocks have achieved significant highs requires the Dow transportation average to have a weekly close below its annual pivot at 5469. This is highly unlikely to occur today, as Thursday's close was the third consecutive all-time high. On Wednesday, I wrote,
Here are the pivots that continue to be magnets in January: The Yield on the 10-Year Treasury Note (1.870%): The rise in yield held my annual value level at 1.981% on Jan. 4. Wall Street and most buy-side strategists have been advising investors to avoid U.S. Treasuries for years now. At the end of 2007 investors could have bought the 10-year note at 4.035%, and today this would be a 5-Year note which ended 2012 at 0.724%. The S&P was 1468 at the end of 2007 and 1426 at the end of 2012. My annual and semiannual value levels are 2.476% and 3.063% with the annual pivot at 1.981% and my semiannual risky level at 1.413%. Remember that QE3 and QE4 will continue until the unemployment rate falls to 6.5%. Comex Gold ($1,687.3): My monthly pivot at $1,673.8 has been a magnet so far in January as expected. My annual value level is $1,599.9 with a monthly pivot at $1,673.8 and semiannual, quarterly and annual risky levels at $1,719.2, $1,802.9 and $1,852.1. Gold may rebound but I do not expect a re-inflation of the gold bubble. The weekly chart for gold shifts to positive with a close today above the five-week modified moving average at $1,682.3. Nymex Crude Oil ($95.32): I expected oil to rebound to test my quarterly risky level at $95.84 and this was accomplished Thursday. My monthly value level lags at $74.23 with a quarterly pivot at $95.84 and annual risky levels at $115.23 and $115.42. Rising oil prices should not be viewed as a re-inflation of a bubble. The weekly chart has been positive since the week of Dec. 21, with the five-week MMA at $91.29 and the 200-week simple moving average at $85.20. The Euro vs. the U.S. Dollar (1.3375): My semiannual value level is 1.2797 with annual and quarterly pivots at 1.3257 and 1.3346. A barrier to the upside is the 200-week MMA at 1.3526, as the weekly chart will become overbought next week. What most market participants do not realize is that the euro is weaker versus the dollar since ending 2007 at 1.459, which is between the June 2010 low at 1.1880 and the July 2008 high at 1.6035.
The Dow Industrial Average (13,596): Monthly and annual value levels are 12,818, 12,696 and 12,509 with quarterly and semiannual risky levels at 13,668, 14,118 and 14,323. The Dow is below its October 2007 high at 14,198.10 and its all-time closing high at 14,164.53 set on Oct. 9, 2007. The S&P 500 (1480.9): Quarterly, annual, monthly and annual value levels are 1431.1, 1400.7, 1397.6 and 1348.3 with quarterly and semiannual risky levels at 1510.0 and 1566.9. These risky levels are below the October 2007 high at 1576.09. The Nasdaq (3136): Monthly and annual value levels are 2934, 2806 and 2790 with a quarterly pivot at 3071 and quarterly and semiannual risky levels at 3274 and 3583. The Nasdaq is below its Sept. 21 high at 3196.93. The Nasdaq 100 (2747): Monthly and annual value levels are 2610, 2463 and 2385 with quarterly and semiannual risky levels at 2798, 2920 and 3196. The Nasdaq 100 is well below its Sept. 21 high at 2878.38. The Dow Transportation Average (5681): Quarterly and monthly value levels are 5094 and 5012 with an annual pivot at 5469 and annual and semiannual risky levels at 5925 and 5955. Transports have set new all-time closing highs three days in a row with Thursday's close at 5681.28. The weekly chart profile has become overbought with the five-week MMA at 5375. The Russell 2000 (890.36): Set an all-time high at 891.00 on Thursday. Quarterly, monthly and annual value levels are 821.01, 813.37 and 809.54 with an annual pivot at 860.25 and quarterly and semiannual risky levels at 913.92 and 965.51. The PHLX Semiconductor Sector Index (SOX) (412.53): Quarterly, monthly and annual value levels are 371.62, 347.83 and 338.03 with quarterly and semiannual risky levels at 440.36 and 520.17. At the time of publication the author held no positions in any of the stocks mentioned. Follow @Suttmeier This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.