Dec 27, 2009 Indicant Weekly Stock Market Report

Volume 12, Issue 04 ISSN 1526 6516 © The Indicant Stock Market Report

Economic Naturalism; Balance and Individual Freedom

Documented history is bounded and qualitatively challenged by four broad constraints. 1) writer’s capacity, 2) absorbability of all phenomena, 3) accuracy of the observer, and 4) bias by the observer.

The documenter’s capacity to record observations or opinions is finite, while the progression of all physical and abstract phenomena approaches infinity. It should be obvious quite a few major events are unknown and perceived known events may be fiction.

As stated last week, the theoretical capacity of any individual is 24-hours per day. If one needs ten-hours of sleep and hygiene, the gross available capacity drops to 14-hours. If one engages in daily soap operas on television, net productive capacity may drop to only ten hours. During the course of daily assignments, net productive capacity may drop to five hours, given a laziness/inability factor of 50%.

During the course of documented history, the number of writers is significantly fractional to the entire flow of all physical and natural phenomena. In essence, documenters have recorded an infinitesimal volume of all that has occurred. Various sciences, such as archaeology, attempt to play catch up. These scientists either confirm previous documentations or disprove them. When doing so, there is generally a lingering question regarding the accuracy of the contemporaries versus those who documented in the past.

Recorded history requires two objects; the observer and the observable phenomenon. Sometimes the observer recorded their observation. At other times, the observer told someone else what he or she observed. And that person told another and so on and so on.

Prior to pencil/pen and paper, observations were chiseled into stone. Contemporary people interpret old language either accurately or inaccurately. Fatigue may have influenced what was chiseled. Or the chiseler’s bias or errant interpretation was recorded.

If the first person describes a picture to a second person, who describes the picture to a third person, etc., the sixth description of the picture is nothing like the picture itself. Feel free to try this at home. It is safe. All you need is six people.

The earlier recordings of history suggest deterioration in accuracy.  Much originated from ancestral story telling. Each generation of story telling watered down what really happened. Each interpretation of chiseled or manuscripts has error. People have a penchant to do two things; exaggerate and fatigue. Both produce error.

There have been only a few, who took time to document what they observed themselves or heard from other observers. All physical and abstract phenomena were not recorded. There have certainly been events that occurred without anyone observing them. Some of those unknown events may have contributed to the course of human events that has landed us to where we are today even more so than recorded events. Those unknown events will never be known until a reverse time machine is invented and used. In essence, the productive capacity to observe all phenomena falls short of the tremendous volumes of phenomena itself.

There is an old saying that no two people see the same the exact same way. This old saying is qualitatively and continuously confirmed from traffic accident police reports. Eyewitnesses, for example, commonly describe a single car crash in different ways. Digitizing a single car crash would result in a single set of numbers that inarguably document what really happened. Digitizing eyewitness observation would produce a set of numbers unequal to what actually happened. Therefore, challenging the accuracy of any observer of any physical or abstract phenomena is always appropriate.

Physical phenomena are without bias. They are what they are. They can be measured and weighed. All physical phenomena represent a complete set of dimensions, diameters, and weight. However, those physical features are recorded differently by different people, even though there is only one set of diameters, dimensions, and weight for any physical object at a moment in time. For example, ask someone to get on the scale and weigh themselves. A person may report they weigh 110-pounds. However, that person’s actual weight may be 112-pounds. Bias enters into even the most personal metrics. Also, two scales may not be exactly calibrated to the same standards another source of error.

The Industrial Engineering Handbook reports that only 85% of defective products are detected by human inspections. In other words, 15 out of every 100 known defective products are passed through as being good products. Some of you have encountered them from time to time. The great Shigeo Shingo of Toyota Production fame worked tirelessly for many decades ridding the inspection process of human judgment. He clearly recognized that human beings are not only inflicted with personal bias, they are also encumbered with a shortage of absolute perfections.

There has been one common thread of abstract phenomenon since the beginning of recorded history and even before that. This abstract phenomenon is void of human beings shortage of capacity and ability to accurately observe. This phenomenon does not need interpretation, bias, or absolute perfection. It is what it is.

Individual freedom is at the core of all that has transpired for the good of human kind. It does not matter how much error that exists in any format; whether in one’s three and a half pound brain or in any book or what can be found through Google. Of course, individual freedom has also led to some of the bad of human kind. Adolph Hitler was apparently freed to the point where mass murder was okay for him to commit. Iran’s puppet leader claims Adolph Hitler never committed those crimes. A scribe listening to Iranian leadership may record this to be fact and hundreds of generations from now may be led to believe Adolph Hitler never did wrong.

In essence, nature requires balance. That is good must be offset by bad. Bears offset bulls and vice versus, but with a mild edge favoring the bull for the past three hundred years. That bullish edge correlates perfectly to the degree of individual freedom; both good and bad.

Economics is not a natural abstract phenomenon. It is a mere reflection of the nature of human kind. Economies offer wealth to the masses when people are free, including Bernie Madoff. Economies offer wealth to only a small group of people when the masses are not free.

That coupled with the universal law of conservation suggests balance is a requirement. Guarding against personal bias requires a return to basic laws. The law of conservation states that energy can neither be created nor destroyed. Other similar laws suggest every action induces an opposite and equal reaction. In essence, there is a balance sheet where the sums of assets (potential energy) and liabilities (kinetic energy) must always be equal.

Amazingly, the financial industry (the low end of all knowledge) even adopts this format where financial phenomena must balance. The past few years has demonstrated this requirement even though those who adopted it do not fully understand the nature of that requirement. They only react when the left side (assets) and right side (liabilities and accumulations) do not properly balance. The stock market tends to accelerate the need to rebalance to a more accurate setting. E.g. Enron, only a few years ago, and now the United States Congress, their pals at Freddie Mac and Fannie Mae, etc.

Using physical laws to convey abstract concepts, helps remove personal bias and related imperfections that encumber all of us. Belief systems become meaningless when using physical laws. Physical laws will exist long after man-made laws are forgotten.

All phenomena require balance. Every amount of dollars gained from the stock market by a set of individuals requires the exact same amount of losses by another set of individuals. The number of sick people requires a balance of medical professional capacity to take care of them. When sick people volume exceeds the capacity of medical professionals, prices go up. That is natural. Capacity eventually catches up to the requirement from increased pricing requirements. Capacity always eventually exceeds the requirement and recessions unfold. Such imbalances are always temporary. Rebalancing shortly follows, as it always has, in capitalistic systems. Balance in capacity and capacity requirements is never found in socialistic or communistic systems. Long lines manifest to form the required balance in the latter two systems and thus forming a fake balance, but a balance nonetheless.

Legislation cannot create balance. All legislation and regulation in any form reduces freedom. Regulations are mostly hype. Regulator’s pay is the same, regardless of effort and/or performance results. Bernie Madoff was not caught even though he violated regulations for many years. He simply turned himself in. Regulators, for the most part, are just yawners with a very high laziness/inability factor. They are five digit salary folks trying to catch seven digit salary folks at doing something wrong. Most never get caught. History never detects it.

Some legislation is required, such as penalties for murderers, even though it restricts the freedom of murderers.  Legislation, directed at non-evil freedom, results in reductions of overall freedom and thus limits economic wealth. Excessive legislation eventually captivates the innocent.

Economic naturalism creates balance. A shortage of any required skill elevates prices for those skills. The economic laws of supply and demand, which parallel physical law, will lead to the required balance. It always has and always will. Legislating does not create balance. It only expands liabilities, depresses accumulations, and with that, all assets depress in value. In essence, the economic wealth available to spread throughout the masses becomes smaller for the required balance is always in play. It is unavoidable by laws of conservation. Human kind cannot violate physical law and get away with it. A price will be paid either way; higher salaries for medical professional and higher prices for drugs and/or massive liabilities to the populace and/or long lines.

Freedom has an ugly side, but a sure requirement of balance. Freedom mandates a right to fail, just as much as it mandates a right to succeed. Legislation should not interfere with this basic dynamic requirement of balance. All legislative interference does is flatten the assets, liabilities, and accumulations and eventually drives all toward zero. That results in non-existence if zero were attained. Of course, physical laws eventually overcome the conclusion of zero, as something must exist. It just may not be us.

Contemporary politicians, who engage in the construction of legislative law, do not understand physical law. History suggests that the founding fathers of the U.S. Constitution possessed a good understanding of physical law. This is not interpretation; E.g., Thomas Jefferson was just as much of a scientist and engineer as he was a statesman. History tells us that. It does not share all the others who may have had the same attributes.

Contemporary politicians appear to be ignorant of physical law. The president of the United States, through his own admission, never took calculus. That implies a significant inability at problem solving or employing people with required skill sets to ensure proper balance. Most in the U.S. Congress have a liberal arts education and have very limited views of physical law. Consequently, they are violating physical law, financial standards, and economic law, all of which has a common theme; balance, which is a first derivative of a basic requirement of prosperity, individual freedom.

Expansive violations of the required balance and consequential reductions of freedom of people will be bearish until such time that the elected politicians do not agree on any subject except legislating a reduction in freedoms of murderers, thieves, politicians, and those who desire to become a dictator. Of course, politicians have great difficulty in reducing their own power. Therein lays the problem.

Eventually, the capital markets will recognize the imbalance and rebalance to what is real.

Keep your eye on the daily stock market report.

Weekly Buy/Sell Summary – Stocks and Funds – Mid-term Indicant

Click this sentence for a graphical summary of what follows. Simply scroll down the page to see graphical and detail content of this section.

The Mid-term Indicant generated four buy signals and no sell signals.

The Mid-term Indicant is signaling hold for 208 of the 333-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 30.5%. That annualizes to 54.1%. The Mid-term Indicant has been signaling hold for these 208-stocks and funds for an average of 29.3-weeks.

The Mid-term Indicant is avoiding 105-stocks and funds of 333- tracked by the Indicant. The avoided stocks and funds are down an average of 40.8% since the Mid-term Indicant signaled sell an average of 90.5-weeks ago.

One year ago, on Dec 26, 2008, the Mid-term Indicant was holding 33-stocks and funds out of 344 tracked for an average of 41.9-weeks. They were up by an average of 55.3% (annualized at 68.7%). There were 311-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 36.2% since their respective sell signals an average of 31.7-weeks earlier.

The Mid-term Indicant was signaling hold for 243-stocks and funds of the 345-tracked two years ago on Dec 28, 2007. They were up by an average of 147.6% (annualized at 59.6%) since their respective buy signals an average of 128.7-weeks earlier. The Mid-term Indicant was avoiding 102-stocks and funds at that time. They were down an average of 13.6% since their respective sell signals an average of 18.6-weeks earlier.

There were 312-stocks and funds with hold signals on Dec 22, 2006 since their buy signals an average of 87.1-weeks earlier. They were up by an average of 103.9% (annualized at 62.0%). There were 30-avoided stocks and funds at that time. They were down by an average of 12.4% from their respective sell signals an average of 20.1-weeks earlier.

On Dec 23, 2005, the Mid-term Indicant was signaling hold for 269-stocks and funds out of 320-tracked. They were up by an average of 97.4% (annualized at 59.9%) since their buy signals an average of 84.6-weeks earlier. The Mid-term Indicant was avoiding 49-stocks and funds at that time. They were down by an average of 15.0% since their sell signals an average of 26.6-weeks earlier.

Five years ago, on Dec 24, 2004, there were 269-hold signals for stocks and funds out of the 320 tracked by the Mid-term Indicant at that time. They were up an average of 72.3% (annualized at 66.4%) since their respective buy signals an average of 56.7-weeks earlier. There were 16-avoided stocks and funds then. They were down an average of 39.6% since their respective sell signals an average of 58.2-weeks earlier.

On Dec 26, 2003, there were 283-stocks and funds with hold signals from the listing of 296-tracked by the Mid-term Indicant at that time. They were up an average of 55.8%, annualizing at 82.9%, since the buy signals an average of 35.0-weeks earlier. There were 10-avoided stocks and funds then. They were down by an average of 26.6% since their sell signals an average of 37.2-weeks earlier.

There were 275-stocks and funds with hold signals on Dec 27, 2002. They were up by an average of 14.2%, annualizing at 54.7%, since their buy signals 13.5-weeks earlier. The ten-avoided stocks and funds were down an average of 25.6% since their respective sell signals an average of 21.9-weeks earlier.

Summary of Stocks and Funds with Buy and Sell Signals This past Week

To maintain appropriate security, you can see the Mid-term Indicant "buy/sell" signals for stocks and funds for this week by clicking the following link. It is in the member’s only section.

Click this link to this week’s buy and sell signals.

As repeatedly stated, do not hold more than 10% of your investment resources in a single stock and do not hold more than 20% of your investment resources into a single mutual fund. Also, never fall in love with a stock or fund. Only love the value of your portfolio. Never love its contents. Management stupidity can wreak havoc on any stock or fund at any time. Socio-economic interference can devastate your holdings from time to time. Congressional behavior can have immediate and long-lasting unfavorable influences on the capital markets.

Some companies will perform well, regardless of the depth of the bear market. Buy signals will be muted if Congressional action threatens the capital markets. Legislation, regulation, and politicians are the biggest threat to the stock market bull.

All updated information can be accessed from the following link. You will need your login ID and password.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm

Comments about Mid-term Indicant Buy and Sell Signals This Weekend

The Long-term, Mid-term, Quick-term, Near-term, and Short-term attributes describing trend are all bullish. The economy is on the mend and earnings should improve. The market may be a bit ahead of earnings potential, but the bullish trends have not been upset, yet. The biggest threat on the immediate horizon continues to be Congressional action. The bull prefers governmental inaction.

The bull’s duration is not known. There are no indications it is ready to expire. Declining Vector Pressure is a minor source of concern, but not yet threatening current bull signals and holding positions.

Click the following link that will take you to the Near-term, Quick-term, and Short-term Indicant models.

http://www.indicant.net/Members/Updates/STI-Mkts/STI-10-Indices/STI08.htm

Stop Loss Management

The Mid-term Indicant recommends a trailing stop loss of 8% due to the Near-term, Quick-term, Short-term Indicant signaling bullish bias while the Mid-term Indicant is also favoring bullish expectations in spite of declining Vector Pressure.

For your longer-term holdings where you are enjoying triple and quadruple digit gains, you may want to set your stop at the bearish yellow price.

For new buys, set stop losses at the blue or green values in the tables. If green is deeply lagging the prevailing price, you may want to average the blue and green prices for your stop losses.

Most of the longer-term signals of stocks and funds continue with “avoid” signals, but a few are still holding. The risk of continued holding, for the likes of Apple, remains relaxed. Other previously strong companies, such as RIMM, are in trouble. The Mid-term Indicant continues avoiding RIMM.

The ETF’s are signaled on the Near-term, Quick-term, and Short-term Indicant and are updated daily. These shorter-term models participate in bullish spurts and rallies, while the Mid-term Indicant is focused on fundamentals and longer-term technical data.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 44.4% since its secular weekly low on October 9, 2002. The NASDAQ is up 105.2% and the S&P500 is up 45.0% since then. The small cap index, S&P600, is up 97.6% since October 9, 2002. All of the major indices were at new lows on the same week in 2002, which is a common attribute for bottoming.

Most major indices last cyclical bottom occurred on March 9, 2009. That includes the four major Dow Indices, the NASDAQ and all of the major S&P Indices. The only exception is the NASDAQ100. It encountered its weekly bottom on November 20, 2008. The resilience of the current Near-term Bull cycle suggests it may indeed have enough sustainability to establish a major cyclical bottom. In other words, the next Near-term Bear cycle may not fall below the March 9, 2009 bottoming. Even with that, statistics supported by 100% accuracy the Reverse Tangential Projections will occur at some future point. Those projections are above these cyclical bottoms, but well below prevailing prices.

The Dow is down 25.7% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 20.1% since its last peak on Oct 31, 2007. The S&P600-small cap index is down 24.2% since its last closing peak on Jul 19, 2007. Bull market expirations are not as obviating with simultaneous peaking like bear markets are with simultaneous bottoming among the major indices.

There is one major point here. If the Near-term Indicant is signaling avoid, all short-term traders should be avoiding, in spite of the potential optimism of not finding a new bottom in the next bear cycle. The longer-term trader should continue patiently awaiting buying clearance from the Mid-term Indicant. There have been quite a few of them the past several months, but muted the past few weeks with Congressional threats to capitalism. Older and strategic longer-term traders are still up by triple digits from the 1991 bull signal by the Long-term Indicant.

The NASDAQ is down 54.7% since its last weekly secular peak on March 9, 2000. The S&P500 is down 26.3% since its similar secular peak on March 23, 2000. The Dow is down by 10.3% since January 13, 2000 when it peaked from the 1990’s roaring bull. As stated the past several years in this report, do not be surprised at the NASDAQ equaling its March 9, 2000 high until after 2025.

As socialism increases, the NASDAQ may not hit its 2000 peak until after 2050. Even that depends on resurgence in entrepreneurialism and related capitalism. Politicians screwed up the economy and the majority apparently believes their proposed fixes. All democracies eventually fail by virtue of tyranny by the stupid majority. We may be witnessing the early stages of that phenomenon.

Politicians are now attempting to impose more constraints on business expansion and thus the continuation of wealth destruction should not be surprising. Politicians have deemed obsolete the normal efficiencies of capitalistic cleansing of the incompetent. That will wear down the capital markets as politicians continue their neurotic desires to expand their influence and controls. Those leeches will eventually kill their host, but like all leeches, they continue on sucking away.

The Dow is up 17.7% so far this year. The NASDAQ is up 40.2% and the S&P500 is up by 22.0%. Keep in mind the post election year is the most bearish and has lost money since 1832. The stock market is not conforming to this historical standard at this time, just as it did not conform in last year’s election year, which is normally bullish.

The NASDAQ year-to-date performance was bearish by 21.3% through this week in 2001. Keep in mind the NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness. So far, the NASDAQ is incongruent with historical standards in this post election year of 2009 with significant bullishness.

The NASDAQ was down by 29.6% through this weekend in 2002. Some of you recall the dynamic bear market in 2002, where the NASDAQ finished that year down by 31.5%. The bear cycle found bottom in October 2002, which is consistent with the mid-term year’s historical standards.

The NASDAQ YTD 2003 performance was up by 47.5%. It finished up in that solidly bullish year by 50.0%, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 7.8% and finished up by 8.6% for that year, which was congruent with election year bullishness, although shy of magnitude standards. 

It was up 3.4% in 2005’s post election year, which contradicted historical standards of losses and/or minimal gains. Many of you recall that 2004 and 2005 were meandering bear markets. 2005’s post election year finished up by a mere 1.4%, which was an excellent year based on post election year historical standards of bearishness.

In 2006, the NASDAQ was up 8.9% on this weekend and finished that year with a 9.5%-gain, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 12.3% at this time in 2007 and finished that year in positive territory by 9.8%, which was consistent with pre-election year bullishness. It was down 42.5% at this time last year. The NASDAQ finished down by 40.5% in 2008. That was contrarian performance to historical election year bullishness and the most bearish presidential election year since related records from 1832.

So far, this presidential post election year is performing inconsistently with historical standards. It continues to be bullish in the face of historical bearishness. Last year’s inconsistency is somewhat influential. Variant directional intensity in one year, quite often, is succeeded with the opposite variant of similar magnitude in the following year. If this holds true in 2010, one would expect resounding bearishness.

The capital markets understand socio-political influences are predominant in the first year of most incoming administrations and thus generally non-bullish with an actual demonstration of outright bearishness in presidential post election year. As the popularity of Congress and the U.S. President wane, the stock market senses a reduction in their power. That is bullish.

Politicians offer nothing pertinent to the quality of life, including health or wealth. They “talk about it” but just one RN offers more toward health and one good entrepreneur offers more toward wealth than the collection of all politicians, kings, queens, and dictators since the beginning of time. Those “control freaks” only talk and rob folks of their wealth and health.

The Short-term Indicant continues signaling bull in spite of the market’s historical standards and current incongruence to those standards.

Keep your eye on the daily stock market report.

Economic Conditions – Inflation, Currency, Interest Rates

Click the above heading for a summary of hard economic indicators.

Short-term rates remain configured at cyclical minimums. As stated for several weeks, that would normally threaten the bull, as rate hikes typically follow cyclical minimums. However, they are so low a prognosis of normalcy borders minutia. In essence, potential rate hikes are irrelevant to the stock market at this time at these levels. The Fed’s current strategy is to maintain low rates, conflicting with the normalcy of rate hikes during economic recovery.

Oil prices continue vacillating in a range the Saudi Kingdom finds comfortable. As previously stated for several months, the kingdom will assert its leadership and regulate supplies to demands that will result in approximately $80/bbl for a lengthy period. Of course, normal human greed will occur and the result will be military action. Participants remain unknown, but most likely will begin with Israel and Iran and concluding with the U.S. and Russia and possibly China. Any scenario is bullish for oil prices and bearish for the stock market.

Several weeks ago, commodities began their elevation into the neutral zone from their bullish mini-cycle. Bearish yellow is now in a solid cyclical shift to the north. That should incite a period of indecisiveness, which is occurring now. Improving economic conditions and the potential for inflation suggests commodities are a good long-term investment. Gold is a Red Bull and setting record highs until two weeks ago, where if fell under the pressures of a strengthening dollar. As stated for several months, gold is a solid long-term investment. It measures regulator incompetence, which is accelerating, and maintains value relative to political interference and deteriorated commerce.

Gold is obviously anticipating significant inflationary behavior with paper currencies. It is also buffering portfolios against governmental policies around the world. A tremendous amount of paper currency has been added to circulation well ahead of the productive efforts normally required to support those levels. Inflation has to follow at some future point. Increased socialism will inherently reduce supply of products and services, while paper money in the hands of the incompetent and non-productive will increase demand. At some future point, an I-Pod may cost well over $10,000. Only the “established elite” will enjoy those sort of possessions, while the masses will have to relearn the drumbeats from their primordial past. Once that nonsensicality has passed, deflation will most likely follow.

As stated 65-weeks ago, once the euphoria of the socialistic methods begin displaying its harsh reality on the reduced quality of life, rest assured the bear market will continue and with gusto. This is not technical. This is fundamental. You will see that prognosis continuing in spite of recent bullish behavior. This cycle should endure a double dip. However, the second dip may not occur until early next year after the “heart and soul” of bullish seasonality concludes around Feb 2010.

The above and below paragraph may become obsolete, based on Blue Dog Democrats upsetting the assumed control of Congress by socialists, communists, and creeps. If they back down and join the evil ones, then the paragraphs remain in tact.

The question remains, is public resistance to healthcare reform really from the grassroots? If so, and if its political influence results in cessation of the rampant stupidity in Washington D.C., the bull will find that too favorable to acquiesce to the bear on the immediate horizon. Although healthcare reform is garnishing most of the attention, cap and trade legislation will depress corporate profits, depress capitalistic adventurism, and thus will eventually depress the stock market.

As stated 60-weeks ago, “probabilities remain high that any bullish cycle will be followed by a deep bear market in 2009.” It is obvious there will be no bear market in 2009. However, that threat remains, “if taxes are raised on the highly productive and capital gains, do not be surprised at a 1,000 Dow by 2010.” The bear has been passive since early March 2009, but it still has plenty of time to demonstrate its reflection of a souring culture. The Blue Dogs have upset this line of thinking and we will know more when Congressional behavior is demonstrated over the next few weeks/months.

As stated the past 17-weeks, on a positive note, it appears enough of the populace are influencing their political representatives to slow the progress of stupidity. If this happens, then bearish expectations of great magnitude will be muted.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 162.2% from its April 13, 2001 buy signal until the Mid-term Indicant sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Oct 16, 2009. It is up 1.7% since then, annualizing at 8.5%. It was bullish last week, following two weeks of solid bearishness. The hold signal appears solid for a long time to come.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 3.9% since then, annualizing at 12.5%.

Vanguard Energy #18, VGENX, was up 144.9% from since the Mid-term Indicant buy signal April 5, 2003 until its sell signal on October 3, 2008. It is up 15.6%, annualizing at 38.1% since its buy signal on July 31, 2009.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003. It received a sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 18, 2009. It is up 2.3% since that buy signal.

State Street Research Global #9, SSGRX, was up 174.2% from its August 16, 2002 buy signal to the Mid-term Indicant sell on October 3, 2008. It is down 16.7% since that sell signal.

Fidelity Energy #39, FSENX, was up 81.2% since the Mid-term Indicant signaled buy on August 16, 2003 and the sell signal on October 3, 2008. It is up 10.7% since its buy signal on Sep 11, 2009, annualizing at 36.6%.

The Near-term Indicant and Quick-term Indicant signaled buy for ETF#03 – Energy and Natural Resources on Aug 3, 2009. It is up 12.4% since then, annualizing at 30.5%. It was up 242.4% (annualized at 44.8%) since its previous buy signal on March 26, 2003 until the September 2008 sell signal.

The Quick-term Indicant signaled buy for the GLD-ETF#11 on December 11, 2008. It is up 34.4% since that buy signal, annualizing at 32.4%. It gained 81.4% from its August 3, 2005 buy signal until the September 8, 2008 sell signal. Its annualized gain during that hold period amounted to 28.2%.  The Near-term Indicant signaled buy on April 24, 2009. It is up 20.8% since the Near-term buy signal, annualizing at 30.2%.

Mid-term Indicant Positions – Ten U.S. Indices

There were no new bull signals and no new bear signals.

The Mid-term Indicant signaled bull on July 31, 2009. The ten major indices are up by an average of 14.6% since that bull signal. That annualizes to 36.1%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $30,214,782. That beats buy and hold performance of $1,600,502 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $146,538. That beats buy and hold’s $110,342 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $208,292. That beats buy and hold’s $79,254 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1787.8%, 32.8%, and 162.8%, respectively, for these indices as of this past week.

The Indicant’s percentage advantage over buy and hold does not change during bull signals. The advantage changes only during bear signals. That is because the buy and hold model has to keep holding, while the Mid-term Indicant model avoids bear markets. The only purpose of the Mid-term Indicant model is to avoid the bear markets. That is why it beat buy and hold by approximately 2,000% covering the past 100+ years. It will not be surprising to see the Mid-term Indicant outperform buy and hold by over 3,000% before the end of this decade. If the market remains bullish during this time, we’ll eat crow. It needs bears to outperform.

Click here for a tour of the Mid-term Indicant for major market indices.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

Click here for Mid-term Indicant Table of NASDAQ 100 Stocks.

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

Click here for Mid-term Indicant - Table of Dow Jones Industrial Average Stocks.

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

Click here for Mid-term Indicant - Dow Jones Utility Stocks Table.

Mid-term Indicant Positions - Indicant Selected Stocks  

Click here to see Indicant Select Stock Report Card history.

Click here for Mid-term Indicant Table of Indicant Selected Stocks.

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant signaled sell for ProFunds Ultra Short on April 3, 2009. It is down 55.6% since then. It remains too risky to buy since the Near-term Indicant Bull continues resisting bearish assaults. Although this is classically a post-election-year hold, current technical indicators are advising to avoid this fund until the Near-term bull cycle expires. However, this Near-term Bull is a thoroughbred.

Click here for Mid-term Indicant Table of Mutual Funds

Remember never to keep more than 20% of your investment resources into a single mutual fund. Sector investing in mutual funds is an extremely good way to mix your investments.

Long Term Indicant Positions - Dow Jones Industrial Average

The blue-chip Long-term Indicant Bull signal was at 2895 for the DJIA in November 1991. Keep in mind the Long-term Indicant generated only five bull/bear cycles since 1920.

The Dow is up 263.4% (annualized at 14.5%) since the Long-term Indicant signaled bull 947-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, inflation, and unreasonable interest rates have not been strong enough to signal bear since that bull signal. Even with today’s economy and stock market position, the 1991 investor is still up triple digit amounts, which remains above average performance when considering long-term planning.

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained on the website for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is included in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months. This report is in the next section and a mere repeat of the daily report you received on the last trading day of the week, which is usually on Friday evening.

Short-term Indicant Stock Market Report - Summary

The Senate finally departed from Washington D.C. That lifts a heavy burden the short-term bull has miraculously carried up the slope the past few weeks.

Although the bull reacted strongly to collapsing NTI Bullish Blue Curves several days ago, it has since cooled and simply running a steady course. It should behave with a bit more spirit in the next few weeks.

Short-term attributes remain in support of the overall stock market bull. The only concern is mild pressure relief in the bull. It is a minor concern, though.

Near-term, Quick-term, Short-term Indicant Stock Market Details

The Near-term Indicant signaled no new bulls and no new bears.

All eleven major non-contrarian indices are up by an average of 28.9%, annualizing at 52.0%, since the NTI signaled bull an average of 28.9-weeks ago. The lone bear is the VIX and it is down 7.8% since its bear signal 3.1-weeks ago.

The Quick-term Indicant signaled no new bulls and no new bears.

Although there were no new bull signals, the Quick-term Indicant is signaling bull for 11-major indices. They are up 22.4%, annualizing at 41.4%, since their bull signals an average of 28.1-weeks ago.

The lone QTI bear, VIX, is down 45.7% since its bear signal 36.0-weeks ago.

The overall stock market remains configured without significant bearish threats.

-Short-term Trend Sensitive Attributes (Includes Near-term and Quick-term)

      QTI-Red Bull Count; Unanimity with eleven supporting bullish bias.

      QTI-Bullish Red Curve Trend; Bullish unanimity with 11 of 11-non-contrarian indices in bullish trend, supporting bullish bias.

      QTI-Bearish Yellow Curve Trend; Non-bearish unanimity with 11 of 11-non-contrarian indices in non-bearish trend, supporting non-bearish bias.

      QIT-Yellow Bear Count; None of the non-contrarian’s are inflicted with this attribute and thus without any bearish bias.

      NTI-Blue Bull Count; Eleven, offering unanimous support for the NTI Bull.

      NTI-Bullish Blue Curve Trend; Eleven non-contrarian in bullish trend.

      NTI-Bearish Green Curve Trend - Non-bearish majority with eleven of eleven non-contrarian indices in bullish trend, supporting near-term non-bearishness.

      STI-Force Vector Cyclical Direction - Ten non-contrarian moving north, supporting bull.

      STI-Vector Pressure Trend-Five non-contrarian moving bullishly, offering bullish support.

      Short-term Summary-Overall-Most attributes remain supportive of the Short-term Bull. The only concern is declining pressure, but most remain in bullish domains.

-Tangential Protection – Sep 1, 2009-Mon-Protection lines were constructed for Dow Transports, Dow Utilities, NASDAQ100, and S&P400. The S&P600-Index lost this protection during the week of November 9, 2009. These indices will not receive a Near-term bear signal until they fall below those tangential protection lines. The other indices will most likely receive bear signals when they fall below their NTI Green Curves with negatively sloping Vector Pressure. Near-term bear synergy cannot manifest until all indices are receiving a Near-term Bear signal. Since March 2009, the bull has responded when attributes neared bear signal justifications.

-Reverse Tangential Bearish Detection -  Although the current Near-term Bull has not yet expired, the following observations still holds true. The timing is unknown, but there is 100% confidence the indices and ETF’s will fall to those prices noted in the below link. (Note: You should not worry about this or consider this until you see the indices and ETF’s fall below the various attributes, such as the bearish yellow or green curves. The stock market can climb by significant magnitudes before the execution of this phenomenon).

-Political Climate – Finally, the Senate finally departed from Washington D.C. on Thursday, December 24, 2009. This should remove the “congressional heavy lid” off of the bull market.

Click this sentence to the table, highlighting RTP’s (Reverse Tangential Projections). The values and magnitudes are expressed in the table on the website. Keep in mind there is 100% confidence in these bearish projections. The problem is not knowing when, but odds favor early next year. Much of this depends on political influences. There will be some unfavorable influences. There always is. The question is, when? As long as the aforementioned attributes are suggesting bullishness and non-bearishness, the bull will continue dominance.

Click the Short-term Indicant to see the combined table of the Near-term Indicant, Quick-term, and Short-term Indicant. The table has links to charts for each. Each chart contains all three models and there are two separate buy and sell signals for either the Near-term and/or Quick-term Indicant.

The tour is still being developed, but most of you are now familiar with the Near-term bull/bear cycles as well as the tangential protections and reverse tangential bearish detectors.

The NYSE and NASDAQ Indicant Volume Indicators  are at the embryonic stages of a robust cycle, if indeed, such a cycle matures. This configuration supports continuing bullishness. Monday’s volume was seasonably light, suggesting a continuation of current bullish bias. Tuesday’s volume, coupled with mild bullishness, was about the same as Monday’s and with the same prognosis; status quo of bullishness. Wednesday’s volume on mild bullishness was “holiday light” and not a meaningful metric. It was “normal” on a seasonally adjusted basis. Christmas Eve volume was closer to zero than average. However, light volume, coupled with mild bullishness, suggest a continuation of bullish bias.

Short-term ETF Report Card, Status, and Charts

The Near-term Indicant generated no buy signals and no sell signals.

The Near-term Indicant is signaling hold for 29-ETF’s. They are up by an average of 18.5%, annualizing at 52.6%, since their buy signals an average of 18.3-weeks ago.

The NTI is avoiding two-ETF’s. They are down 5.7% since their sell signals an average of 4.1-weeks ago.

The Quick-term Indicant generated no buy signals and no sell signals.

The Quick-term Indicant is signaling hold for 29-ETF’s. They are up an average of 28.3% since their buy signals an average of 29.2-weeks ago. Those with hold signals are annualizing at 50.4%.

The two avoided ETF’s are down by an average of 32.2% since their sell signals an average of 20.9-weeks ago.

Near-term Indicant ETF Key Attributes

NTI Blue Bulls Count; solid majority of 27-offering bullish support.

NTI Blue Curve Trend; 28-sloping north; strong bullish support.

NTI Green Curve Trend; 22-sloping north; strong majority support for non-bearishness. The bear cannot dominate with this configured attribute.

Quick-term Indicant ETF Key Attributes

QTI Red Bull Count; solid majority of 27-support Quick-term bullishness.

QTI Bullish Red Curve Trend; 28-sloping north in solid majority support for Quick-term bullishness.

QTI Yellow Bear Count; zero non-contrarian represents a solid majority supporting Quick-term non-bearishness.

QTI Bearish Yellow Curve Trend;  29-sloping north, highlighting solid non-bearishness.

The Short-term Indicant ETF Key Attributes:

Vector Pressure Bullish Domain Occupancy; strong majority of 29 in bullish domains, supporting bull.

Vector Pressures Slope Relative to Vector Pressure: 28 in bullish position.

Vector Pressure Trend; minority of 14-moving in bullish direction, supporting bull.

Short-term Summary: Most attributes remain in support of the bull.

Click here to get a quick overview of the regular mutual funds as they stood several months ago. As you can see, many of them are down by double digit percentage points since the Mid-term Indicant signaled sell in late 2007 and in early 2008. The Mid-term Indicant is updated each weekend with a link to the member’s section. Members can click this sentence to get a more recent update. You will notice buy signals the past few weeks for the first time in several months.

Click the below link to see today’s Near-term, Quick-term, and Short-term Indicant signals. Links on that page will take you to a single chart with all the model’s position on each ETF.

http://www.indicant.net/Members/Updates/STI-SQI-QTI-ETF-SumPage/0UD%20QTI-ETF0-Sum.htm

Contrarian Funds

ProFunds Ultra Short mutual fund moves inversely to the QQQQ by exponential amounts. See the Mid-term Indicant for its status.

The Near-term Indicant signaled sell for QID on November 16, 2009. It is down 7.6% since that sell signal. Its configuration no longer supports potential for short-term bullishness.

The Quick-term Indicant signaled sell for QID on March 26, 2009. It is down 58.4% since then. The Quick-term Indicant will not signal buy until it contacts the bearish yellow curve, which is valued at $28.15 and still falling.

ETF#03-Natural Resources   - The Near-term Indicant and Quick-term Indicant signaled buy on August 3, 2009. It is up 12.4% since those buy signals, annualizing at 31.3%. Its NTI Bullish Blue Curve collapsed on Dec 8, 2009. A sell signal will be released in the event NTI Green shifts to the south.

ETF#11-Gold and Precious Metals  is up 34.4% since the QTI signaled buy on December 11, 2008. Annualized growth is at 32.7%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $95.02 and still rising.

The Near-term Indicant signaled buy on Apr 24, 2009. It is up 20.8% since then, annualizing at 30.7%.

You will notice its NTI Bullish Blue Curve collapsed after being attacked by the Gold Bear. Vector Pressures remain in bullish domains and the dominant attribute that should minimize bearish damage to the Gold Bull. After this profit taking by the experts, taking money from advertising respondents, Gold should rebound, after the advertising respondents get scared and sell their losses. You should continue to hold.

As stated for the last several months, gold remains fundamentally sound for long-term holding and a technical measure of authenticity in that assessment is in its bearish yellow curve. If it crosses below bearish yellow, you will not want to be holding.  The Quick-term Indicant will highlight that potential when this occurs.

ETF#14-TLT-Long Government  received a sell signal on Dec 4, 2009 from both the Near-term and Quick-term Indicant. It is down 3.9% since that sell signal. All TLT attributes are solidly bearish.

Major ETF Events

Dec 24, 2009-The U.S. Senate adjourned, removing a burden from the short-term bull.

Dec 23, 2009-Again no major events confronted the short-term bull.

Dec 22, 2009-No major events with mild bullish behavior.

Dec 21, 2009-Gold was truly contrarian with solid bearish expressions in the face of overall stock market bullishness.

Current Strategy-Short-term Indicant- Dec 24, 2009-Bull remains solid. Holding remains safe. Dec 22, 2009-Same as yesterday. Dec 21, 2009-Holding remains safe.

Click Quick-term Indicant, Near-term, and Short-term for all 31-ETF’s.

Other links:

Short-term Indicant for DJIA and NASDAQ

Short-term Indicant Tables for the Dow Jones Industrial Average Index

Short-term Indicant Table for the NASDAQ Composite Index

Indicant Volume Indicator

Near-term, Quick-term, and Short-term Indicant for Major Indices

Divergence versus Convergence

The bull’s rest may be over with the first week of decisive bullish convergence. Do not be surprised at continuing bullishness until Congress returns in late January, which coincides with non-bullish behavior.

Indicant Conclusion

As stated the past eleven weeks, low interest rates offer narrowed alternative investment opportunities. The argument holds that sideline cash is not smart. As long as this perception prevails, the bull cycle should continue.

It has been reported, but not verified by the Indicant, that most of the cash infusion into the stock market since the bull began last March is from hedge funds. The individual investor has not yet returned to the stock market. There remains more bullish potential for the stock market from this “fundamental” perspective.

Configurations remain supportive of the current Short-term bull. As long as the Short-term bull remains in tact, there is no threat to the Mid-term Bull.

Keep up with the daily stock market report as the Quick-term and Near-term attributes can shift quickly.

Do not get lazy and set those stop losses for those stocks and funds that continue to enjoy hold signals.

The daily updates are on the following link.

http://www.indicant.net/Non-Members/Back%20Issues/QT.htm

Hyperlinks

To access all major markets, stocks, funds, economic data, charts, statuses, etc, click the following hyperlink:

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm 

Once you are inside the website, click on "members update" or simply log in. It is on the top of every page in the web site so you can always find your way back.

Happy Investing,

www.indicant.net

12/27/09

Dec 20, 2009 Indicant Weekly Stock Market Report

Volume 12, Issue 03 ISSN 1526 6516 © The Indicant Stock Market Report

Big Government

Big, excessively influential, governments have consistently demonstrated three results; long lines, higher poverty, and war. Problems start with long lines. As the government expands, more people are conscripted into the military where the political elite can control the behavior of those in long lines. The political elite direct some folks to bang on drums or blow into trumpets. That way, the political elite can keep the conscripted in well defined lines and under their complete control. The political elite provide guns to their brothers and first cousins with instruction to shoot any of the conscripted that are out of step.

The political elite swell with tremendous pride as they gaze down upon the stupid masses that march to their desired drum beat.

Informal long lines manifest for the most basic needs, such as bread and vodka. Those lines are not controlled but the pitiful souls constituting those lines are no threat to the political elite. The political elite have everything while the masses have little. Of course, it is the masses fault for the political elite cannot exist without concurrence by the masses. The political elite enjoy generations of ignorance by the masses. The political elite are eventually removed from their positions of power for universal law disallows the non-productive to exist indefinitely.

As resources are sucked from the shrinking numbers of productive, the poverty level naturally increases among the masses. Those few productive people by their character and nature continue to work hard but their shrinking numbers generate exponentially more demand on a per unit basis for their skills. Those few productive are farmers, manufacturers, extractors, doctors, nurses, etc. Politicians in any form are not productive. Certain laws are needed to protect earned possessions, but eventually the political elite envy those whose possessions they are suppose to protect.

The trial lawyers who support healthcare reform do not understand the “big picture.” As resources shrivel, the first to go are pure economic overhead members in the private sector. In other words, as the political elite gain power, the need for attorneys shrinks. History shows that unabated political power yields zero need for attorneys. Economic leeches are no different from biological leeches. All they do is leech and eventually kill their host and then themselves.

A few savvy attorneys will do just fine for a few generations. They will get a job in the various justice departments and align themselves closely with the political elite. However, the capacity for such positions is narrow. Most will be relegated to the lowest level among all economic participants.

The nature of governmental dominance tends to drive all non elites to the lowest economic performer in their respective cultures. In essence, everyone is rewarded the exact same amounts for their efforts. Consequently, those with more potential lower their output to the lowest output performer in their economic unit. That is easy to rationalize since there is no benefit for being more productive. Eventually effort and output all become equal and drive toward zero over time.

This process lowers demonstrated capacity. Theoretical capacity remains high as it reflects the productive hours per day times the number of people with capacity to accomplish. Demonstrated capacity, on the other hand, reflects actual output. Demonstrated capacity can be said to be equal to theoretical capacity times the laziness/inability factor. For example, 1,000 people times ten productive hours is equal to 10,000 hours of theoretical capacity. If the laziness/inability factor is at 50%, demonstrated capacity is halved to only 5,000 hours. If the product output is a fishcake, taking ten hours a day to produce one, there will only be 5,000 fishcakes. So, each person would have to share their fishcakes, each getting one-half. Or, each person could get a whole fish cake by agreeing to eat every other day.

Over time, the laziness/inability factor will approach 25% of theoretical capacity as the lack of nutrition cuts into ones ability to be productive. Those who want to be productive see their peers low level of output and more or less eventuate their output to equal the output of laziest slob in their unit. At 25% laziness/inability factor, each person will only get one-quarter fishcake or the populace could agree to eating a whole fishcake every fourth day. The decreasing nutrition leads to a few more becoming less productive in addition to peer equality pressures. Those that remain with closer to theoretical capacity continually cut their output to that of the lowest performer. And so on and so on. The target of large government systems is always zero output. It is not designed that way; it just happens; always has and always will.

Economics run by governments create long lines. If fishcake producers provided their product to a supermarket, the waiting line before big government and when theoretical capacity approximates demonstrated capacity would be, say, one day for fishcakes. Over time, the waiting line would increase to four days at a laziness/inability factor of 25%. Rest assured big government will yield less than 25% laziness/inability factor over time. That four-day wait will increase to eight, then ten, etc. and then deactivates to an overthrow of the political elite or extinction of the species. Those are always the two only choices confronting humankind (over-throw or extinction)..

Healthcare reform will result in the same phenomenon. If the majority of Americans desire healthcare reform as being legislated by their politically elected, they deserve what they have voted for themselves and their offspring, which could last through multiple generations. Such a phenomenon is natural. That is nature’s way of weeding out the weak and stupid. Without doing so threatens the survivability of the human species. From a strategic viewpoint, this possibly could be a good thing for long-term survivability in spite of its near-term unpleasantness and our being unlucky participants.

Big government accelerates this cleansing of the stupid and weak. As demonstrated capacity shrinks, poverty and hate both increase. Wars typically evolve from any big government. The wars wipe out many more of the stupid and weak as they will tend to battle on the basis of hate and hate alone. Descendents who ignorantly facilitated the rise in power of the political elite are incapable of seeing the big picture. The good news is that the leaders during times of cleansing eventually fall prey to their own ineptness. That has always occurred in the past and will always occur in the future.

All organizations fail at some point, including the U.S. Government. Time will prove it is not immune to this phenomenon. Elected politicians are not special. On the contrary, their stupidity is unbelievable, but most likely reflecting their constituents, who tend to vote for the best liar. Politicians compete only on one level, where the victor is generally proven to be the better liar than their defeated opponents.

It is apparent a leech majority has manifested since their “elected politicians” are about to increase the size of government by exponential amounts far exceeding even the theoretical productive capacity of the masses. The gap between theoretical capacity and demonstrated capacity will widen and quite considerably. Over time, the numbers of conscripted with rise. Long lines, both formal and informal, will manifest. Wars will follow.

The post FDR generation is now dying. The post FDR generation was indeed the greatest generation. They saw, first hand, how big governments, both domestic and foreign, do not lead to good. On the contrary, the result is always evil. It always has been, but apparently the contemporary majority people do not read or think. That is one reason why many of their ancestors died a fiery death at the cause of another and they are entering another cycle of stupidity.

The FDR post generation offspring do not understand the eventuality of big governments, for the most part; at least 51% of the population. They will follow the same path of their great grandparents, who set around listening to FDR’s radio programs and believing his bull. That is they elected proponents of big government and lived in poverty because of their ineptness at understanding a more prosperous course.

History suggests such economic/cultural cycles are not avoidable. Leeches must eventually destroy themselves. We are seeing the early stages of this “unfavorable” cycle. The elections of 2010 will offer a measure of the level of stupidity among the populace. Massive stupidity will assumed to be continuing if incumbent politicians are reelected. If so, they will enhance their status as politically elite and expand the natural process of economic leeching.

One can suppose the silver lining is that the ignorant elected their politicians, who by default, will legislate the demise of their constituents. Once this generation and the one to follow passes, nature will provide a return to logic and sensible action. The current populace is no different from hundreds of the past. Wrong-headed thinking of “giving unearned access and possession” is a mathematical impossibility. The very nature of leeching drives to this conclusion.

Healthcare reform is being constructed by a very few people. Those people believe they are the only ones wise enough to construct a viable document. They have no respect for the opinions of others, which is a common attribute for the egotistically driven. None of them provides competitive values; most, if not all, never have. Their only element of success is out-lying their defeated opponents. They have no idea of what accurate thinking is about. In essence, those who believe they are the wisest are actually among those of massive stupidity.

If healthcare reform passes, regardless of content, more resources will be processed through bigger government, which is the most massive source of expanding the lazy/inability factor. Rest assured that is bearish for the stock market. However, the stock market has a penchant for sniffing the future. Right now, the stock market is projecting the demise of excessive political and governmental influence on the economy and healthcare. The stock market will turn bearish if it sniffs a nasty stench from Washington D.C. as having their way.

Keep your eye on the daily stock market report.

Weekly Buy/Sell Summary – Stocks and Funds – Mid-term Indicant

Click this sentence for a graphical summary of what follows. Simply scroll down the page to see graphical and detail content of this section.

The Mid-term Indicant generated no buy signals and no sell signals.

The Mid-term Indicant is signaling hold for 208 of the 333-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 27.1%. That annualizes to 49.8%. The Mid-term Indicant has been signaling hold for these 208-stocks and funds for an average of 28.3-weeks.

The Mid-term Indicant is avoiding 109-stocks and funds of 333- tracked by the Indicant. The avoided stocks and funds are down an average of 40.7% since the Mid-term Indicant signaled sell an average of 90.0-weeks ago.

One year ago, on Dec 19, 2008, the Mid-term Indicant was holding 31-stocks and funds out of 344 tracked for an average of 42.9-weeks. They were up by an average of 60.4% (annualized at 73.2%). There were 311-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 35.1% since their respective sell signals an average of 30.7-weeks earlier.

The Mid-term Indicant was signaling hold for 226-stocks and funds of the 345-tracked two years ago on Dec 21, 2007. They were up by an average of 158.2% (annualized at 61.4%) since their respective buy signals an average of 134.0-weeks earlier. The Mid-term Indicant was avoiding 100-stocks and funds at that time. They were down an average of 2.8% since their respective sell signals an average of 17.8-weeks earlier.

There were 312-stocks and funds with hold signals on Dec 15, 2006 since their buy signals an average of 86.1-weeks earlier. They were up by an average of 107.7% (annualized at 65.0%). There were 31-avoided stocks and funds at that time. They were down by an average of 12.7% from their respective sell signals an average of 19.7-weeks earlier.

On Dec 16, 2005, the Mid-term Indicant was signaling hold for 270-stocks and funds out of 320-tracked. They were up by an average of 98.0% (annualized at 61.0%) since their buy signals an average of 83.5-weeks earlier. The Mid-term Indicant was avoiding 48-stocks and funds at that time. They were down by an average of 15.8% since their sell signals an average of 28.3-weeks earlier.

Five years ago, on Dec 17, 2004, there were 298-hold signals for stocks and funds out of the 320 tracked by the Mid-term Indicant at that time. They were up an average of 70.8% (annualized at 65.3%) since their respective buy signals an average of 56.4-weeks earlier. There were 16-avoided stocks and funds then. They were down an average of 40.2% since their respective sell signals an average of 58.0-weeks earlier.

On Dec 19, 2003, there were 277-stocks and funds with hold signals from the listing of 296-tracked by the Mid-term Indicant at that time. They were up an average of 55.4%, annualizing at 83.1%, since the buy signals an average of 34.7-weeks earlier. There were 10-avoided stocks and funds then. They were down by an average of 26.6% since their sell signals an average of 36.6-weeks earlier.

There were 275-stocks and funds with hold signals on Dec 20, 2002. They were up by an average of 16.0%, annualizing at 67.3%, since their buy signals 12.4-weeks earlier. The ten-avoided stocks and funds were down an average of 27.5% since their respective sell signals an average of 22.7-weeks earlier.

Summary of Stocks and Funds with Buy and Sell Signals This past Week

To maintain appropriate security, you can see the Mid-term Indicant "buy/sell" signals for stocks and funds for this week by clicking the following link. It is in the member’s only section.

Click this link to this week’s buy and sell signals.

As repeatedly stated, do not hold more than 10% of your investment resources in a single stock and do not hold more than 20% of your investment resources into a single mutual fund. Also, never fall in love with a stock or fund. Only love the value of your portfolio. Never love its contents. Management stupidity can wreak havoc on any stock or fund at any time. Socio-economic interference can devastate your holdings from time to time. Congressional behavior can have immediate and long-lasting unfavorable influences on the capital markets.

Some companies will perform well, regardless of the depth of the bear market. Buy signals will be muted if Congressional action threatens the capital markets. Legislation, regulation, and politicians are the biggest threat to the stock market bull.

All updated information can be accessed from the following link. You will need your login ID and password.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm

Comments about Mid-term Indicant Buy and Sell Signals This Weekend

The Long-term, Mid-term, Quick-term, Near-term, and Short-term attributes describing trend are all bullish. The economy is on the mend and earnings should improve. The market may be a bit ahead of earnings potential, but the bullish trends have not been upset, yet. The biggest threat on the immediate horizon continues to be Congressional action. The bull prefers governmental inaction.

The bull’s duration is not known. There are no indications it is ready to expire. Declining Vector Pressure is a minor source of concern. This is one reason why there were no buy signals this weekend, but not yet threatening current bull signals and holding positions.

Click the following link that will take you to the Near-term, Quick-term, and Short-term Indicant models.

http://www.indicant.net/Members/Updates/STI-Mkts/STI-10-Indices/STI08.htm

Stop Loss Management

The Mid-term Indicant recommends a trailing stop loss of 8% due to the Near-term, Quick-term, Short-term Indicant signaling bullish bias while the Mid-term Indicant is also favoring bullish expectations in spite of declining Vector Pressure.

For your longer-term holdings where you are enjoying triple and quadruple digit gains, you may want to set your stop at the bearish yellow price.

For new buys, set stop losses at the blue or green values in the tables. If green is deeply lagging the prevailing price, you may want to average the blue and green prices for your stop losses.

Most of the longer-term signals of stocks and funds continue with “avoid” signals, but a few are still holding. The risk of continued holding, for the likes of Apple, remains relaxed. Other previously strong companies, such as RIMM, are in trouble. The Mid-term Indicant continues avoiding RIMM.

The ETF’s are signaled on the Near-term, Quick-term, and Short-term Indicant and are updated daily. These shorter-term models participate in bullish spurts and rallies, while the Mid-term Indicant is focused on fundamentals and longer-term technical data.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 41.8% since its secular weekly low on October 9, 2002. The NASDAQ is up 98.5% and the S&P500 is up 41.9% since then. The small cap index, S&P600, is up 90.0% since October 9, 2002. All of the major indices were at new lows on the same week in 2002, which is a common attribute for bottoming.

Most major indices last cyclical bottom occurred on March 9, 2009. That includes the four major Dow Indices, the NASDAQ and all of the major S&P Indices. The only exception is the NASDAQ100. It encountered its weekly bottom on November 20, 2008. The resilience of the current Near-term Bull cycle suggests it may indeed have enough sustainability to establish a major cyclical bottom. In other words, the next Near-term Bear cycle may not fall below the March 9, 2009 bottoming. Even with that, statistics supported by 100% accuracy the Reverse Tangential Projections will occur at some future point. Those projections are above these cyclical bottoms, but well below prevailing prices.

The Dow is down 27.1% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 22.6% since its last peak on Oct 31, 2007. The S&P600-small cap index is down 27.1% since its last closing peak on Jul 19, 2007. Bull market expirations are not as obviating with simultaneous peaking like bear markets are with simultaneous bottoming among the major indices.

There is one major point here. If the Near-term Indicant is signaling avoid, all short-term traders should be avoiding, in spite of the potential optimism of not finding a new bottom in the next bear cycle. The longer-term trader should continue patiently awaiting buying clearance from the Mid-term Indicant. There have been quite a few of them the past few months, but muted the past few weeks with Congressional threats to capitalism. Older and strategic longer-term traders are still up by triple digits from the 1991 bull signal by the Long-term Indicant.

The NASDAQ is down 56.2% since its last weekly secular peak on March 9, 2000. The S&P500 is down 27.8% since its similar secular peak on March 23, 2000. The Dow is down by 11.9% since January 13, 2000 when it peaked from the 1990’s roaring bull. As stated the past several years in this report, do not be surprised at the NASDAQ equaling its March 9, 2000 high until after 2025.

As socialism increases, the NASDAQ may not hit its 2000 peak until after 2050. Even that depends on resurgence in entrepreneurialism and related capitalism. Politicians screwed up the economy and the majority apparently believes their proposed fixes. All democracies eventually fail by virtue of tyranny by the stupid majority. We may be witnessing the early stages of that phenomenon.

Politicians are now attempting to impose more constraints on business expansion and thus the continuation of wealth destruction should not be surprising. Politicians have deemed obsolete the normal efficiencies of capitalistic cleansing of the incompetent. That will wear down the capital markets as politicians continue their neurotic desires to expand their influence and controls. Those leeches will eventually kill their host, but like all leeches, they continue on sucking away.

The Dow is up 17.7% so far this year. The NASDAQ is up 40.2% and the S&P500 is up by 22.0%. Keep in mind the post election year is the most bearish and has lost money since 1832. The stock market is not conforming to this historical standard at this time, just as it did not conform in last year’s election year, which is normally bullish.

The NASDAQ year-to-date performance was bearish by 18.9% through this week in 2001. Keep in mind the NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness. So far, the NASDAQ is incongruent with historical standards in this post election year of 2009.

The NASDAQ was down by 30.2% through this weekend in 2002. Some of you recall the dynamic bear market in 2002, where the NASDAQ finished that year down by 31.5%. The bear cycle found bottom in October 2002, which is consistent with the mid-term year’s historical standards.

The NASDAQ YTD 2003 performance was up by 46.5%. It finished up in that solidly bullish year by 50.0%, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 6.6% and finished up by 8.6% for that year, which was congruent with election year bullishness, although shy of magnitude standards. 

It was up 3.7% in 2005’s post election year, which contradicted historical standards of losses and/or minimal gains. Many of you recall that 2004 and 2005 were meandering bear markets. 2005’s post election year finished up by a mere 1.4%, which was an excellent year based on post election year historical standards of bearishness.

In 2006, the NASDAQ was up 10.4% on this weekend and finished that year with a 9.5%-gain, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 7.5% at this time in 2007 and finished that year in positive territory by 9.8%, which was consistent with pre-election year bullishness. It was down 41.5% at this time last year. The NASDAQ finished down by 40.5% in 2008. That was contrarian performance to historical election year bullishness and the most bearish presidential election year since related records from 1832.

So far, this presidential post election year is performing inconsistently with historical standards. It continues to be bullish in the face of historical bearishness. Last year’s inconsistency is somewhat influential. Variant directional intensity in one year, quite often, is succeeded with the opposite variant with similar magnitude in the following year.

The capital markets understand socio-political influences are predominant in the first year of most incoming administrations and thus generally non-bullish with an actual demonstration of outright bearishness in presidential post election year. As the popularity of Congress and the U.S. President wane, the stock market senses a reduction in their power. That is bullish.

Politicians offer nothing pertinent to the quality of life, including health or wealth. They “talk about it” but just one RN offers more toward health and one good entrepreneur offers more toward wealth than the collection of all politicians, kings, queens, and dictators since the beginning of time. Those “control freaks” only talk and rob folks of their wealth and health.

The Short-term Indicant continues signaling bull in spite of the market’s historical standards and current incongruence to those standards.

Keep your eye on the daily stock market report.

Economic Conditions – Inflation, Currency, Interest Rates

Click the above heading for a summary of hard economic indicators.

Short-term rates remain configured at cyclical minimums. As stated for several weeks, that would normally threaten the bull, as rate hikes typically follow cyclical minimums. However, they are so low a prognosis of normalcy borders minutia. In essence, potential rate hikes are irrelevant to the stock market at this time at these levels. The Fed’s current strategy is to maintain low rates, conflicting with the normalcy of rate hikes during economic recovery.

Oil prices continue vacillating in a range the Saudi Kingdom finds comfortable. As previously stated, the kingdom will assert its leadership and regulate supplies to demands that will result in approximately $80/bbl for a lengthy period. Of course, normal human greed will occur and the result will be military action. Participants remain unknown, but most likely will begin with Israel and Iran and concluding with the U.S. and Russia and possibly China. Any scenario is bullish for oil prices and bearish for the stock market.

Several weeks ago, commodities began their elevation into the neutral zone from their bullish mini-cycle. Bearish yellow is now in a solid cyclical shift to the north. That should incite a period of indecisiveness, which is occurring now. Improving economic conditions and the potential for inflation suggests commodities are a good long-term investment. Gold is a Red Bull and setting record highs until last week, where if fell under the pressures of a strengthening dollar. As stated for several months, gold is a solid long-term investment. It measures regulator incompetence, which is accelerating, and maintains value relative to political interference and deteriorated commerce.

Gold is obviously anticipating significant inflationary behavior with paper currencies. It is also buffering portfolios against governmental policies around the world. A tremendous amount of paper currency has been added to circulation well ahead of the productive efforts normally required to support those levels. Inflation has to follow at some future point. Increased socialism will inherently reduce supply of products and services, while paper money in the hands of the incompetent and non-productive will increase demand. At some future point, an I-Pod may cost well over $10,000. Only the “established elite” will enjoy those sort of possessions, while the masses will have to relearn the drumbeats from their primordial past. Once that nonsensicality has passed, deflation will most likely follow.

As stated 64-weeks ago, once the euphoria of the socialistic methods begin displaying its harsh reality on the reduced quality of life, rest assured the bear market will continue and with gusto. This is not technical. This is fundamental. You will see that prognosis continuing in spite of recent bullish behavior. This cycle should endure a double dip. However, the second dip may not occur until early next year after the “heart and soul” of bullish seasonality concludes around Feb 2010.

The above and below paragraph may become obsolete, based on Blue Dog Democrats upsetting the assumed control of Congress by socialists, communists, and creeps. If they back down and join the evil ones, then the paragraphs remain in tact.

The question remains, is public resistance to healthcare reform really from the grassroots? If so, and if its political influence results in cessation of the rampant stupidity in Washington D.C., the bull will find that too favorable to acquiesce to the bear on the immediate horizon. Although healthcare reform is garnishing most of the attention, cap and trade legislation will depress corporate profits, depress capitalistic adventurism, and thus will eventually depress the stock market.

As stated 59-weeks ago, “probabilities remain high that any bullish cycle will be followed by a deep bear market in 2009.” It is obvious there will be no bear market in 2009. However, that threat remains, “if taxes are raised on the highly productive and capital gains, do not be surprised at a 1,000 Dow by 2010.” The bear has been passive since early March 2009, but it still has plenty of time to demonstrate its reflection of a souring culture. The Blue Dogs have upset this line of thinking and we will know more when Congressional behavior is demonstrated over the next few weeks/months.

As stated the past 16-weeks, on a positive note, it appears enough of the populace are influencing their political representatives to slow the progress of stupidity. If this happens, then bearish expectations of great magnitude will be muted.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 162.2% from its April 13, 2001 buy signal until the Mid-term Indicant sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Oct 16, 2009. It is down 0.7% since then. It was solidly bearish the past two weeks, but merely priming the bull for future dynamic gains. The U.S. dollar strengthened the past few weeks, but that is temporary. It will weaken.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 1.1% since then, annualizing at 3.6%.

Vanguard Energy #18, VGENX, was up 144.9% from since the Mid-term Indicant buy signal April 5, 2003 until its sell signal on October 3, 2008. It is up 11.6%, annualizing at 29.8% since its buy signal on July 31, 2009.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003. It received a sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 18, 2009. It is down 0.8% since that buy signal.

State Street Research Global #9, SSGRX, was up 174.2% from its August 16, 2002 buy signal to the Mid-term Indicant sell on October 3, 2008. It is down 21.0% since that sell signal.

Fidelity Energy #39, FSENX, was up 81.2% since the Mid-term Indicant signaled buy on August 16, 2003 and the sell signal on October 3, 2008. It is up 6.5% since its buy signal on Sep 11, 2009, annualizing at 23.9%.

The Near-term Indicant and Quick-term Indicant signaled buy for ETF#03 – Energy and Natural Resources on Aug 3, 2009. It is up 8.1% since then, annualizing at 20.9%. It was up 242.4% (annualized at 44.8%) since its previous buy signal on March 26, 2003 until the September 2008 sell signal.

The Quick-term Indicant signaled buy for the GLD-ETF#11 on December 11, 2008. It is up 35.1% since that buy signal, annualizing at 33.7%. It gained 81.4% from its August 3, 2005 buy signal until the September 8, 2008 sell signal. Its annualized gain during that hold period amounted to 28.2%.  The Near-term Indicant signaled buy on April 24, 2009. It is up 21.4% since the Near-term buy signal, annualizing at 32.0%.

Mid-term Indicant Positions – Ten U.S. Indices

There were no new bull signals and no new bear signals.

The Mid-term Indicant signaled bull on July 31, 2009. The ten major indices are up by an average of 12.0% since that bull signal. That annualizes to 31.2%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $29,665,608. That beats buy and hold performance of $1,571,412 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $143,415. That beats buy and hold’s $107,990 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $201,548. That beats buy and hold’s $76,688 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1787.8%, 32.8%, and 162.8%, respectively, for these indices as of this past week.

The Indicant’s percentage advantage over buy and hold does not change during bull signals. The advantage changes only during bear signals. That is because the buy and hold model has to keep holding, while the Mid-term Indicant model avoids bear markets. The only purpose of the Mid-term Indicant model is to avoid the bear markets. That is why it beat buy and hold by approximately 2,000% covering the past 100+ years. It will not be surprising to see the Mid-term Indicant outperform buy and hold by over 3,000% before the end of this decade. If the market remains bullish during this time, we’ll eat crow. It needs bears to outperform.

Click here for a tour of the Mid-term Indicant for major market indices.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

Click here for Mid-term Indicant Table of NASDAQ 100 Stocks.

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

Click here for Mid-term Indicant - Table of Dow Jones Industrial Average Stocks.

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

Click here for Mid-term Indicant - Dow Jones Utility Stocks Table.

Mid-term Indicant Positions - Indicant Selected Stocks  

Click here to see Indicant Select Stock Report Card history.

Click here for Mid-term Indicant Table of Indicant Selected Stocks.

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant signaled sell for ProFunds Ultra Short on April 3, 2009. It is down 52.4% since then. It remains too risky to buy since the Near-term Indicant Bull continues resisting bearish assaults. Although this is classically a post-election-year hold, current technical indicators are advising to avoid this fund until the Near-term bull cycle expires. However, this Near-term Bull is a thoroughbred.

Click here for Mid-term Indicant Table of Mutual Funds

Remember never to keep more than 20% of your investment resources into a single mutual fund. Sector investing in mutual funds is an extremely good way to mix your investments.

Long Term Indicant Positions - Dow Jones Industrial Average

The blue-chip Long-term Indicant Bull signal was at 2895 for the DJIA in November 1991. Keep in mind the Long-term Indicant generated only five bull/bear cycles since 1920.

The Dow is up 256.8% (annualized at 14.1%) since the Long-term Indicant signaled bull 946-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, inflation, and unreasonable interest rates have not been strong enough to signal bear since that bull signal. Even with today’s economy and stock market position, the 1991 investor is still up triple digit amounts, which remains above average performance when considering long-term planning.

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained on the website for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is included in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months. This report is in the next section and a mere repeat of the daily report you received on the last trading day of the week, which is usually on Friday evening.

Short-term Indicant Stock Market Report - Summary

As stated the last few days, until the major stock market indices and non-contrarian ETF’s interact with the NTI Bearish Green curve, the bull will remain in tact.

The bull responded to Thursday’s intrusion by the bear. The bull was obviously offended by several NTI Bullish Blue Curves collapsing.

XLF received a buy signal today. Pressure is at equilibrium with various market vectors. Also, many banks are being reinserted into the S&P500 Index. Many index funds will have to be buying banks, many of which are XLF holdings.

Short-term attributes remain in support of the overall stock market bull. The only concern is mild pressure relief in the bull. It is a minor concern, though.

Near-term, Quick-term, Short-term Indicant Stock Market Details

The Near-term Indicant signaled no new bulls and no new bears.

All eleven major non-contrarian indices are up by an average of 25.9%, annualizing at 48.0%, since the NTI signaled bull an average of 28.0-weeks ago. The lone bear is the VIX and it is up 3.1% since its bear signal 2.3-weeks ago.

The Quick-term Indicant signaled no new bulls and no new bears.

Although there were no new bull signals, the Quick-term Indicant is signaling bull for 11-major indices. They are up 19.5%, annualizing at 37.2%, since their bull signals an average of 27.3-weeks ago.

The lone QTI bear, VIX, is down 39.3% since its bear signal 35.1-weeks ago.

The overall stock market remains configured without significant bearish threats.

-Short-term Trend Sensitive Attributes (Includes Near-term and Quick-term)

      QTI-Red Bull Count; Unanimity with eleven supporting bullish bias.

      QTI-Bullish Red Curve Trend; Bullish unanimity with 11 of 11-non-contrarian indices in bullish trend, supporting bullish bias.

      QTI-Bearish Yellow Curve Trend; Non-bearish unanimity with 11 of 11-non-contrarian indices in non-bearish trend, supporting non-bearish bias.

      QIT-Yellow Bear Count; None of the non-contrarian’s are inflicted with this attribute and thus without any bearish bias.

      NTI-Blue Bull Count; Eight, offering mild majority support for the NTI Bull.

      NTI-Bullish Blue Curve Trend;11-non-contrarian in bullish trend.

      NTI-Bearish Green Curve Trend - Non-bearish majority with eleven of eleven non-contrarian indices in bullish trend, supporting near-term non-bearishness.

      STI-Force Vector Cyclical Direction - Two non-contrarian moving north and no longer a solid majority.

      STI-Vector Pressure Trend-Majority of six non-contrarian moving bullishly, offering bullish support.

      Short-term Summary-Overall-Most attributes remain supportive of the Short-term Bull. The only concern is declining pressure, but most remain in bullish domains.

-Tangential Protection – Sep 1, 2009-Mon-Protection lines were constructed for Dow Transports, Dow Utilities, NASDAQ100, and S&P400. The S&P600-Index lost this protection during the week of November 9, 2009. These indices will not receive a Near-term bear signal until they fall below those tangential protection lines. The other indices will most likely receive bear signals when they fall below their NTI Green Curves with negatively sloping Vector Pressure. Near-term bear synergy cannot manifest until all indices are receiving a Near-term Bear signal. Since last March, the bull has responded when attributes neared bear signal justifications.

-Reverse Tangential Bearish Detection -  Although the current Near-term Bull has not yet expired, the following observations still holds true. The timing is unknown, but there is 100% confidence the indices and ETF’s will fall to those prices noted in the below link. (Note: You should not worry about this or consider this until you see the indices and ETF’s fall below the various attributes, such as the bearish yellow or green curves. The stock market can climb by significant magnitudes before the execution of this phenomenon).

-Political Climate – Quiet for the time being, which is fundamentally bullish. If you see political headlines regarding healthcare passage and/or cap and trade passage, be prepared for the bearish onslaught.

Click this sentence to the table, highlighting RTP’s (Reverse Tangential Projections). The values and magnitudes are expressed in the table on the website. Keep in mind there is 100% confidence in these bearish projections. The problem is not knowing when, but odds favor early next year. Much of this depends on political influences. There will be some unfavorable influences. There always is. The question is, when? As long as the aforementioned attributes are suggesting bullishness and non-bearishness, the bull will continue dominance.

Click the Short-term Indicant to see the combined table of the Near-term Indicant, Quick-term, and Short-term Indicant. The table has links to charts for each. Each chart contains all three models and there are two separate buy and sell signals for either the Near-term and/or Quick-term Indicant.

The tour is still being developed, but most of you are now familiar with the Near-term bull/bear cycles as well as the tangential protections and reverse tangential bearish detectors.

The NYSE and NASDAQ Indicant Volume Indicators  lethargic configuration continues slowing, but remaining unimpressive. Monday’s volume was mild on mild bullish behavior, suggesting little interest in shifting bias support. Thus, the bull remains in tact. Tuesday’s volume was up just a bit over yesterday’s on equally mild bearish behavior. Although inflationary fears aroused the bear, there was no apparent rush to sell stocks last Tuesday. Wednesday’s volume was up a bit on mild mixed behavior, suggesting indecisiveness and supporting continuation of bullish bias. Thursday’s volume was mixed with an above average NYSE trading and mildly below average NASDAQ trading. This suggested bearish aggression was simple stock market nervousness. Friday’s volume was relatively high on solid bullish behavior. This adds probability of continuing bullishness and somewhat accelerated from the past few weeks of wavering behavior.

Short-term ETF Report Card, Status, and Charts

The Near-term Indicant generated one buy signal and no sell signals.

The Near-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 15.3%, annualizing at 44.0%, since their buy signals an average of 18.1-weeks ago.

The NTI is avoiding two-ETF’s. They are down 0.5% since their sell signals an average of 2.2-weeks ago.

The Quick-term Indicant generated no buy signals and no sell signals.

The Quick-term Indicant is signaling hold for 29-ETF’s. They are up an average of 24.0% since their buy signals an average of 28.4-weeks ago. Those with hold signals are annualizing at 43.9%.

The avoided ETF’s are down by an average of 28.0% since their sell signals an average of 20.1-weeks ago.

Near-term Indicant ETF Key Attributes

NTI Blue Bulls Count; minority of 12-offering bullish support.

NTI Blue Curve Trend; 23-sloping north; strong bullish support.

NTI Green Curve Trend; 27-sloping north; strong majority support for non-bearishness. The bear cannot dominate with this configured attribute.

Quick-term Indicant ETF Key Attributes

QTI Red Bull Count; a majority of 23-support Quick-term bullishness.

QTI Bullish Red Curve Trend; 28-sloping north in solid majority support for Quick-term bullishness.

QTI Yellow Bear Count; zero non-contrarian represents a solid majority supporting Quick-term non-bearishness.

QTI Bearish Yellow Curve Trend;  29-sloping north, highlighting solid non-bearishness.

The Short-term Indicant ETF Key Attributes:

Vector Pressure Bullish Domain Occupancy; 29 in bullish domains, supporting bull.

Vector Pressure Trend; minority of 13-moving in bullish direction, supporting bull.

Short-term Summary: Most attributes remain in support of the bull.

Click here to get a quick overview of the regular mutual funds as they stood several months ago. As you can see, many of them are down by double digit percentage points since the Mid-term Indicant signaled sell in late 2007 and in early 2008. The Mid-term Indicant is updated each weekend with a link to the member’s section. Members can click this sentence to get a more recent update. You will notice buy signals the past few weeks for the first time in several months.

Click the below link to see today’s Near-term, Quick-term, and Short-term Indicant signals. Links on that page will take you to a single chart with all the model’s position on each ETF.

http://www.indicant.net/Members/Updates/STI-SQI-QTI-ETF-SumPage/0UD%20QTI-ETF0-Sum.htm

Contrarian Funds

ProFunds Ultra Short mutual fund moves inversely to the QQQQ by exponential amounts. See the Mid-term Indicant for its status.

The Near-term Indicant signaled sell for QID on November 16, 2009. It is up 1.0% since that sell signal. It remains configured for potential “short-term bullishness” but significantly more overall stock market bearish synergy is required to signal buy for this fund and QQQQ must demonstrate  interest in bearish behavior.

The Quick-term Indicant signaled sell for QID on March 26, 2009. It is down 55.5% since then. The Quick-term Indicant will not signal buy until it contacts the bearish yellow curve, which is valued at $28.51 and still falling.

ETF#03-Natural Resources   - The Near-term Indicant and Quick-term Indicant signaled buy on August 3, 2009. It is up 8.1% since those buy signals, annualizing at 21.4%. Its NTI Bullish Blue Curve collapsed on Dec 8, 2009. A sell signal will be released in the event NTI Green shifts to the south. It is getting close, but most likely preparing for a solid bullish response to this insult by the bear. It rebounded nicely earlier this week, but was mildly bearish the past two days.

ETF#11-Gold and Precious Metals  is up 35.1% since the QTI signaled buy on December 11, 2008. Annualized growth is at 32.4%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $94.56 and still rising.

The Near-term Indicant signaled buy on Apr 24, 2009. It is up 21.4% since then, annualizing at 32.4%.

As expected GLD has bullishly rebounded nicely the past earlier this week. It fell sharply on Thursday and moved solidly to the north on Friday. Its NTI Bullish Blue Curve collapsed with on Thursday’s bearish aggression. As expected, this angered the “golden bull.”

As stated for the last several months, gold remains fundamentally sound for long-term holding and a technical measure of authenticity in that assessment is in its bearish yellow curve. If it crosses below bearish yellow, you will not want to be holding.  The Quick-term Indicant will highlight that potential when this occurs.

ETF#14-TLT-Long Government  received a sell signal on Dec 4, 2009 from both the Near-term and Quick-term Indicant. It is down 0.6% since that sell signal.

Major ETF Events

Dec 18, 2009-Friday’s bullishness nearly offset Thursday’s bearish aggression. All ETF’s with collapsing NTI Blue Curves bounced bullishly today. Apparently, the lazy bull was inspired to demonstrate its dominance after incursions by the bear last Thursday. Also, ETF#05-XLF received a buy signal today. Several banks will return to the S&P500 Index and many index funds will have to buy their shares.

Dec 17, 2009-Several NTI Bullish Blue Curves collapsed today, including GLD. The others are ETF#’s 08, 13, and 21; all foreign related, which reflects the strengthening dollar.

Dec 16, 2009-VIX NTI Bullish Blue collapsed today, adding substance to overall stock market bullish bias.

Dec 15, 2009-Inflationary fears did not propel massive sell off. Although the stock market was mildly bearish, no attributes identified a potential shift in stock market sentiment. All remains bullish.

Dec 14, 2009-No major events today; just the slow, boring, but steady bull.

Current Strategy-Short-term Indicant-Dec 18, 2009-As stated yesterday, the bull remains in tact. Dec 17, 2009-Although a few attributes lost their strong bullish support today, the bull remains in tact. Dec 16, 2009-Although bull appears lazy, it is solidly clinging to the NTI Bullish Blue Curve. Other than gold’s bullishness the past two days, the market will likely remain with minimal volatility until after option expiration this Friday. The stock market appears to be punishing those with short-term profit motives with its steady state performance the past several days. Dec 15, 2009-Holding continues to be safe. Dec 14, 2009-Holding remains safe.

Click Quick-term Indicant, Near-term, and Short-term for all 31-ETF’s.

Other links:

Short-term Indicant for DJIA and NASDAQ

Short-term Indicant Tables for the Dow Jones Industrial Average Index

Short-term Indicant Table for the NASDAQ Composite Index

Indicant Volume Indicator

Near-term, Quick-term, and Short-term Indicant for Major Indices

Divergence versus Convergence

Two consecutive weeks of flatness with mild bearish divergence suggests indecisiveness. Blue chips were bearish, but utilities were bullish. The NASDAQ was bullish. The energy sector was also mildly bullish while commodities were somewhat bearish on the strengthening U.S. dollar. Pressure is declining suggesting a maximum cycle point is underway, but not threatening to the bull. The bull is obviously resting.

Indicant Conclusion

As stated the past ten weeks, low interest rates offer narrowed alternative investment opportunities. The argument holds that sideline cash is not smart. As long as this perception prevails, the bull cycle should continue.

Configurations remain supportive of the current Short-term bull. As long as the Short-term bull remains in tact, there is no threat to the Mid-term Bull.

Keep up with the daily stock market report as the Quick-term and Near-term attributes can shift quickly.

Do not get lazy and set those stop losses for those stocks and funds that continue to enjoy hold signals.

The daily updates are on the following link.

http://www.indicant.net/Non-Members/Back%20Issues/QT.htm

Hyperlinks

To access all major markets, stocks, funds, economic data, charts, statuses, etc, click the following hyperlink:

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm 

Once you are inside the website, click on "members update" or simply log in. It is on the top of every page in the web site so you can always find your way back.

Happy Investing,

www.indicant.net

12/20/09

Dec 13, 2009 Indicant Weekly Stock Market Report

Volume 12, Issue 02 ISSN 1526 6516 © The Indicant Stock Market Report

This Week’s Report

Riskless Decision-Making and OPM

Making decisions, using other people’s money, OPM, will not involve the detailed intensity as one using one’s own money. The use of OPM disallows the natural feedback of reward or punishment based on the quality and timeliness of decisions.

As a matter of eventual fact, those whose livelihoods evolving around the use of OPM are the least respected. They are economic parasites. The reason the word, eventual, preceded the word fact in the first sentence of this paragraph is that historians tend to evolve from the liberal arts profession. In essence, historians biased thinking stand in the way of identifying the good, bad, and ugly in history. For example, as some future point, historians will recognize and identify FDR as the inventor of economic parasites. The populace will then view FDR as nearly as bad as Adolph Hitler. Those two individuals could not exist without the other. In essence, their respective behaviors created each other.

Although all biological units possess varying degrees of parasitical behavior, a lion at least works to acquire food, while a pure parasite is not so confrontationally and without hardly any personal risk. They very casually and quietly drain its host with hardly any effort at all. All they have to do is latch onto something and then quietly consume nutrients from its host. There are many more documentaries describing a lion than a leach. Apparently, there is much more interest and admiration in the lion’s behavior than that of a leach.

There are five primary organizational units in the U.S. They are families, ma and pa operations, corporations, government, and not for profit organizations. Families, for the most part, operate within a budget where expenses approximate income. Some use credit to acquire possessions when their income or savings are insufficient to their desires. A few become bankrupt when they do not adequately manage their finances.

Ma and pa operations are very similar to families. They use their own money, for the most part, to finance their companies. Their daily decisions are excruciating; most of which involve the simple survivability of their enterprise. Their daily pressures are second to none. Most love what they do and do it from their hearts. They love their business nearly as much as they love their children. Ma and pa operations and small corporations provide employment growth. A few ma and pa operations evolve into great corporations.

The reasons small companies provide more employment opportunities are simple. First, their daily decisions put their enterprises before themselves. Secondly, they are small with significant more room to grow. Finally, but not the least important, small business leaders are more competent than large corporate managers are. Small business owners disdain stupidity. If you have a business sense and some spare time, spend a day or two in a large corporation. You will hear more stupidity in those few days than you would hear in a smaller company over years.

Many small companies do not survive. Most fail due to being under-capitalized. In other words, most do not use other people’s money. Sometimes one’s inspiration exceeds their financial capacity. Their efforts, in spite of their failures, are heroic anyway. It takes nearly an infinite amount of more effort to create a company for profit than merely writing a resume and getting a job. Large corporations’ employees only got a job. They have little understanding of what was required to get their employer to the position of being able to hire them and provide a livelihood. Stupidity evolves from their narrowed perspectives about business. Most are departmentalized and thus narrows their perspectives even more.

The third organizational group, corporations, uses other people’s money. Some of them do this well, as they return more of the other people’s money than they took. However, most of the S&P500 companies today will not do that. As of 1998, only 86 of the S&P500 companies in 1957 were still in business. All large corporations eventually expire. One reason for their eventual expiration is the use of other people’s money and the related stupidity it garnishes.

General Motors is an example of what happens to organizations using OPM. Click this link to view GM’s chart. As you can see, GM traded above $100 as recently as the year 2000. It closed last week at $0.59 a share. There are several detailed reasons for GM’s demise, but it can be traced to using OPM.

Since the death of GM’s former great leader, Alfred P. Sloan, GM’s management made poor decisions. Their labor unions also made poor decisions. Most of their decisions related to “bad greed.” Bad greed occurs when people want wealth accumulation without actually earning it. “Good greed” occurs when people work hard and honestly to accumulate wealth.

Painful feedback to an individual making poor decisions is slow when using other people’s money. That contrasts with small companies, where poor decisions can lead to an empty dining room table and very quickly.

Quite often, the offending poor decision maker is immune to the financial and/or operational consequences of their poor decisions. For example, Roger Smith, the 1980’s CEO of GM made some poor decisions, but he lived a comfortable life in retirement. Mr. Smith did not personally endure the consequences for his incompetence. CEO’s, since Alfred P. Sloan’s death, enjoyed a similarly nice retirement in spite of their poor decisions. They were, in essence, immune to their own stupidity. Small business owners and small cap executives cannot stand the presence of such people.

The poor decisions at General Motors relate to several competitors who developed new and improved methods of automobile production. The management teams at GM should have copied the Toyota Production System and improve upon that. Instead, they lived their lives of luxury, ignoring competitive threats. Consequently, their grandchildren will not enjoy the same pleasantries they did in the automobile production industry.

Personal immunity from bad decisions is at the core of the problem. For example, Roger Smith spent a lot of time enhancing his power in corporate governance. During his tenure, Toyota and other competitors were gaining market share. However, rather than understanding, copying, and improving the Toyota Production System at GM, Roger kept figuring out ways for he and his pals to get more money out of GM for personal wealth. He received his salary every month and it actually increased while GM was heading south toward its ultimate destiny of expiration.

This contrasts with ma and pa operations and some small caps. Every day, people in those organizations make decisions purely in the interest in their organization’s survivability and prosperity. Their personal needs are secondary to that of their organizations and their personal needs are satisfied by the organization’s progress and only by that progress. In other words, there is a direct connection between their personal needs and that of the organization. This contrasts, significantly, where there is little connection between self-reward/punishment and organizational performance in larger organizations.

The fourth organizational unit is government. Governments are not special. They are made up of the same species that drive large corporations into extinction. Government is simply another organizational unit that will eventually perish.

All organizational units eventually expire; families, ma and pa operations, corporations, government, and not for profit. The smaller organizational units expire due to biological constraints; everyone dies. The bigger ones have enough of “other people’s money” to perpetuate new biological units, replacing those that retire or die. Each generation of replacements is of lesser quality than the prior one, much like what happens when repeatedly making copies of the same document at a copy machine. Eventually, the paper will be white.

The bigger organizational units fail for one and only one reason. There is no direct connection between self-reward/punishment and decision-making. That is because they use OPM.

How will czar specialists in the Federal Government be punished for their bad decisions? Their next paycheck will be awarded regardless of the quality of their decisions. There will be no punishment and thus the quality of their decisions will be on the low end of potential. That contrasts with the life of the likes of Thomas Edison, where the light bulb either worked or not. If it did not work, Mr. Edison would not eat, as his efforts exceeding 18-hour workdays in that effort consumed all of his time. Rest assured no one in government, using OPM, will work with the excruciating details that Mr. Edison did. The same is true in the dilettante infested Fortune 500 companies.

All decisions made by government employees are riskless from a personal perspective. Each and everyday they go to work, they will be confronted with issues. Plodding along at their exceedingly low productivity rate some will actually make a decision. The problem is the decision is never a good one. Those who have a sense of real value for obvious reasons do not respect those who engage in the work of using OPM. They put nothing they own into the mix. In essence, they are not only members of economic overhead they are also economic parasites.

It is impossible to make a good decision without enduring personal risk. It is 100% impossible that all variables will be thought about when consequence, favorable or unfavorable, to the decision-maker is absent. Rest assured when using OPM, very little thought goes into decision-making and that is assuming if a decision is actually made. Even if a decision is made, proper action and follow through will most likely remain absent, while the paychecks continually flow into the hands of the decision-maker, regardless of the level of performance.

Government employees, including elected politicians, do not endure the consequences of bad decisions. Most decisions by government employees and politicians are wrong. A couple of statements easily prove this.

1. You cannot point to one single desirous possession you own that was provided by the government until the recent acquisition of GM by the government. Rest assured such a possession will not be desirous at trade in time.

2. Receipts to government for spending are not earned.

The problem with immunity from punishment by bad decision-making is that at some unknown future point, that immunity becomes obsolete. At that point, the culmination of years of bad decisions has become so entropic that the parasitical process has exceeded the capacity of the hosts’ provisions of funds. In other words, the leeches have sucked their host dry.

Economic parasites are in human DNA. Although the populace in other countries has overthrown their governments from time to time in the past, the descendants of the overthrown simply find other hosts to devour. They are much like the parasitical process one can see in the forests, consisting of dead trees and when looking closely, you can see those same parasites that killed the trees sucking from a live tree and killing it as well.

The stock market is an excellent leading indicator of the entropic conclusion of this process. All organizations fail. Fortunately, the stock market and free markets provide nice and profitable replacements for those that fail. The idea is to not be holding stocks in those companies expiring during your investing lifetime. The idea is to own stocks in those companies who employ the likes of Alfred P. Sloan, Thomas Edison, and others like them. Although they used other people’s money from time to time, they had unique character that drove them to return much more than they took. There is absolutely no one in any government anywhere in the world with that character and that ability.

So, keep your investments away from any organization that is tied to any government. If the CEO and his pals spend a lot of time with politicians and government employees, do not invest. Even if that garnishes huge government contracts, rest assured the performance will not be to your liking. There will be money rotation, but you will be excluded from the circle of rotation.

Keep your eye on the daily stock market report.

Weekly Buy/Sell Summary – Stocks and Funds – Mid-term Indicant

Click this sentence for a graphical summary of what follows. Simply scroll down the page to see graphical and detail content of this section.

The Mid-term Indicant generated seven buy signals and no sell signals.

The Mid-term Indicant is signaling hold for 201 of the 333-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 27.9%. That annualizes to 51.5%. The Mid-term Indicant has been signaling hold for these 201-stocks and funds for an average of 28.2-weeks.

The Mid-term Indicant is avoiding 109-stocks and funds of 333- tracked by the Indicant. The avoided stocks and funds are down an average of 40.5% since the Mid-term Indicant signaled sell an average of 89.0-weeks ago.

The letters, NLT, identify stocks and funds no longer traded. We used to use the last signal at the time of the last trade to maintain consistencies in the report card. However, we expect several corporations to fail or merge in the coming months and years. Marking such failures with the letters, NLT, will not disrupt the report card. We can then more quickly identify replacements for those that have failed or merged into another company. NLT companies and funds are excluded from the report card summaries at the time of being classified as NLT. However, the report card’s historical record is not adjusted. It always reflects the recommendations and performance as it stood at the time of said performance and recommendations.

One year ago, on Dec 12, 2008, the Mid-term Indicant was holding 29-stocks and funds out of 344 tracked for an average of 44.5-weeks. They were up by an average of 64.9% (annualized at 75.8%). There were 313-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 35.3% since their respective sell signals an average of 29.6-weeks earlier.

The Mid-term Indicant was signaling hold for 227-stocks and funds of the 345-tracked two years ago on Dec 14, 2007. They were up by an average of 154.3% (annualized at 60.3%) since their respective buy signals an average of 133.1-weeks earlier. The Mid-term Indicant was avoiding 109-stocks and funds at that time. They were down an average of 9.1% since their respective sell signals an average of 16.3-weeks earlier.

There were 311-stocks and funds with hold signals on Dec 08, 2006 since their buy signals an average of 85.3-weeks earlier. They were up by an average of 108.1% (annualized at 65.8%). There were 33-avoided stocks and funds at that time. They were down by an average of 11.9% from their respective sell signals an average of 19.1-weeks earlier.

On Dec 9, 2005, the Mid-term Indicant was signaling hold for 271-stocks and funds out of 320-tracked. They were up by an average of 92.7% (annualized at 58.7%) since their buy signals an average of 82.1-weeks earlier. The Mid-term Indicant was avoiding 47-stocks and funds at that time. They were down by an average of 16.2% since their sell signals an average of 27.7-weeks earlier.

Five years ago, on Dec 10, 2004, there were 300-hold signals for stocks and funds out of the 320 tracked by the Mid-term Indicant at that time. They were up an average of 68.6% (annualized at 64.6%) since their respective buy signals an average of 57.3-weeks earlier. There were 17-avoided stocks and funds then. They were down an average of 43.7% since their respective sell signals an average of 57.3-weeks earlier.

On Dec 12, 2003, there were 271-stocks and funds with hold signals from the listing of 296-tracked by the Mid-term Indicant at that time. They were up an average of 53.1%, annualizing at 82.6%, since the buy signals an average of 33.5-weeks earlier. There were 15-avoided stocks and funds then. They were down by an average of 25.1% since their sell signals an average of 35.9-weeks earlier.

There were 286-stocks and funds with hold signals on Dec 13, 2002. They were up by an average of 14.8%, annualizing at 67.4%, since their buy signals 11.5-weeks earlier. The nine-avoided stocks and funds were down an average of 27.3% since their respective sell signals an average of 23.0-weeks earlier.

Summary of Stocks and Funds with Buy and Sell Signals This past Week

To maintain appropriate security, you can see the Mid-term Indicant "buy/sell" signals for stocks and funds for this week by clicking the following link. It is in the member’s only section.

Click this link to this week’s buy and sell signals.

As repeatedly stated, do not hold more than 10% of your investment resources in a single stock and do not hold more than 20% of your investment resources into a single mutual fund. Also, never fall in love with a stock or fund. Only love the value of your portfolio. Never love its contents. Management stupidity can wreak havoc on any stock or fund at any time. Socio-economic interference can devastate your holdings from time to time. Congressional behavior can have immediate and long-lasting unfavorable influences on the capital markets.

Some companies will perform well, regardless of the depth of the bear market. Buy signals will be muted if Congressional action threatens the capital markets. Legislation, regulation, and politicians are the biggest threat to the stock market bull.

All updated information can be accessed from the following link. You will need your login ID and password.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm

Comments about Mid-term Indicant Buy and Sell Signals This Weekend

The Long-term, Mid-term, Quick-term, Near-term, and Short-term attributes describing trend are all bullish. The economy is on the mend and earnings should improve. The market may be a bit ahead of earnings potential, but the bullish trends have not been upset, yet. The biggest threat on the immediate horizon continues to be Congressional action. The bull prefers governmental inaction.

As stated the last few weeks, the Mid-term Indicant is poised for several more buy signals in the next few weeks. The Short-term Indicant ridded itself of the few remaining attributes supporting bearish ambition two weeks ago.

The bull’s duration is not known. There are no indications it is ready to expire.

Click the following link that will take you to the Near-term, Quick-term, and Short-term Indicant models.

http://www.indicant.net/Members/Updates/STI-Mkts/STI-10-Indices/STI08.htm

Stop Loss Management

The Mid-term Indicant recommends a trailing stop loss of 8% due to the Near-term, Quick-term, Short-term Indicant signaling bullish bias while the Mid-term Indicant is also favoring bullish expectations.

For your longer-term holdings where you are enjoying triple and quadruple digit gains, you may want to set your stop at the bearish yellow price.

For new buys, set stop losses at the blue or green values in the tables. If green is deeply lagging the prevailing price, you may want to average the blue and green prices for your stop losses.

Most of the longer-term signals of stocks and funds continue with “avoid” signals, but a few are still holding. The risk of continued holding, for the likes of Apple, remains relaxed. Other previously strong companies, such as RIMM, are in trouble. The Mid-term Indicant continues avoiding RIMM.

The ETF’s are signaled on the Near-term, Quick-term, and Short-term Indicant and are updated daily. These shorter-term models participate in bullish spurts and rallies, while the Mid-term Indicant is focused on fundamentals and longer-term technical data.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 43.7% since its secular weekly low on October 9, 2002. The NASDAQ is up 96.6% and the S&P500 is up 42.4% since then. The small cap index, S&P600, is up 85.8% since October 9, 2002. All of the major indices were at new lows on the same week in 2002, which is a common attribute for bottoming.

Most major indices last cyclical bottom occurred on March 9, 2009. That includes the four major Dow Indices, the NASDAQ and all of the major S&P Indices. The only exception is the NASDAQ100. It encountered its weekly bottom on November 20, 2008. The resilience of the current Near-term Bull cycle suggests it may indeed have enough sustainability to establish a major cyclical bottom. In other words, the next Near-term Bear cycle may not fall below the March 9, 2009 bottoming. Even with that, statistics supported by 100% accuracy the Reverse Tangential Projections will occur at some future point. Those projections are above these cyclical bottoms, but well below prevailing prices.

The Dow is down 26.1% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 23.4% since its last peak on Oct 31, 2007. The S&P600-small cap index is down 28.7% since its last closing peak on Jul 19, 2007. Bull market expirations are not as obviating with simultaneous peaking like bear markets are with simultaneous bottoming among the major indices.

There is one major point here. If the Near-term Indicant is signaling avoid, all short-term traders should be avoiding, in spite of the potential optimism of not finding a new bottom in the next bear cycle. The longer-term trader should continue patiently awaiting buying clearance from the Mid-term Indicant. There have been quite a few of them the past few months, but muted the past few weeks with Congressional threats to capitalism. Older and strategic longer-term traders are still up by triple digits from the 1991 bull signal by the Long-term Indicant.

The NASDAQ is down 56.6% since its last weekly secular peak on March 9, 2000. The S&P500 is down 27.6% since its similar secular peak on March 23, 2000. The Dow is down by 10.7% since January 13, 2000 when it peaked from the 1990’s roaring bull. As stated the past several years in this report, do not be surprised at the NASDAQ equaling its March 9, 2000 high until after 2025.

As socialism increases, the NASDAQ may not hit its 2000 peak until after 2050. Even that depends on resurgence in entrepreneurialism and related capitalism. Politicians screwed up the economy and the majority apparently believes their proposed fixes. All democracies eventually fail by virtue of tyranny by the stupid majority. We may be witnessing the early stages of that phenomenon.

Politicians are now attempting to impose more constraints on business expansion and thus the continuation of wealth destruction should not be surprising. Politicians have deemed obsolete the normal efficiencies of capitalistic cleansing of the incompetent. That will wear down the capital markets as politicians continue their neurotic desires to expand their influence and controls. Those leeches will eventually kill their host, but like all leeches, they continue on sucking away.

The Dow is up 19.3% so far this year. The NASDAQ is up 38.9% and the S&P500 is up by 22.5%. Keep in mind the post election year is the most bearish and has lost money since 1832. The stock market is not conforming to this historical standard at this time, just as it did not conform in last year’s election year, which is normally bullish.

The NASDAQ year-to-date performance was bearish by 19.0% through this week in 2001. Keep in mind the NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness. So far, the NASDAQ is incongruent with historical standards in this post election year of 2009.

The NASDAQ was down by 28.4% through this weekend in 2002. Some of you recall the dynamic bear market in 2002, where the NASDAQ finished that year down by 31.5%. The bear cycle found bottom in October 2002, which is consistent with the mid-term year’s historical standards.

The NASDAQ YTD 2003 performance was up by 45.4%. It finished up in that solidly bullish year by 50.0%, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 6.2% and finished up by 8.6% for that year, which was congruent with election year bullishness, although shy of magnitude standards. 

It was up 3.7% in 2005’s post election year, which contradicted historical standards of losses and/or minimal gains. Many of you recall that 2004 and 2005 were meandering bear markets. 2005’s post election year finished up by a mere 1.4%, which was an excellent year based on post election year historical standards of bearishness.

In 2006, the NASDAQ was up 10.8% on this weekend and finished that year with a 9.5%-gain, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 9.8% at this time in 2007 and finished that year in positive territory by 9.8%, which was consistent with pre-election year bullishness. It was down 43.1% at this time last year. The NASDAQ finished down by 40.5% in 2008. That was contrarian performance to historical election year bullishness and the most bearish presidential election year since related records from 1832.

So far, this presidential post election year is performing inconsistently with historical standards. It continues to be bullish in the face of historical bearishness. Last year’s inconsistency is somewhat influential. Variant directional intensity in one year, quite often, is succeeded with the opposite variant with similar magnitude in the following year.

The capital markets understand socio-political influences are predominant in the first year of most incoming administrations and thus generally non-bullish with an actual demonstration of outright bearishness in presidential post election year. As the popularity of Congress and the U.S. President wane, the stock market senses a reduction in their power. That is bullish.

Politicians offer nothing pertinent to the quality of life, including health or wealth. They “talk about it” but just one RN offers more toward health and one good entrepreneur offers more toward wealth than the collection of all politicians, kings, queens, and dictators since the beginning of time. Those “control freaks” only talk and rob folks of their wealth and health.

The Short-term Indicant continues signaling bull in spite of the market’s historical standards and current incongruence to those standards.

Keep your eye on the daily stock market report.

Economic Conditions – Inflation, Currency, Interest Rates

Click the above heading for a summary of hard economic indicators.

Short-term rates remain configured at cyclical minimums. As stated for several weeks, that would normally threaten the bull, as rate hikes typically follow cyclical minimums. However, they are so low a prognosis of normalcy borders minutia. In essence, potential rate hikes are irrelevant to the stock market at this time at these levels. The Fed’s current strategy is to maintain low rates, conflicting with the normalcy of rate hikes during economic recovery.

Oil prices continue vacillating in a range the Saudi Kingdom finds comfortable. As previously stated, the kingdom will assert its leadership and regulate supplies to demands that will result in approximately $80/bbl for a lengthy period.

Several weeks ago, commodities began their elevation into the neutral zone from their bullish mini-cycle. Bearish yellow is now in a solid cyclical shift to the north. That should incite a period of indecisiveness, which is occurring now. Improving economic conditions and the potential for inflation suggests commodities are a good long-term investment. Gold is a Red Bull and setting record highs. As stated for several months, gold is a solid long-term investment. It measures regulator incompetence, which is accelerating, and maintains value relative to political interference and deteriorated commerce.

The U.S. Dollar continues to weaken.

Gold is obviously anticipating significant inflationary behavior with paper currencies. It is also buffering portfolios against governmental policies around the world. A tremendous amount of paper currency has been added to circulation well ahead of the productive efforts normally required to support those levels. Inflation has to follow at some future point. Increased socialism will inherently reduce supply of products and services, while paper money in the hands of the incompetent and non-productive will increase demand. At some future point, an I-Pod may cost well over $10,000. Only the “established elite” will enjoy those sort of possessions, while the masses will have to relearn the drumbeats from their primordial past. Once that nonsensicality has passed, deflation will most likely follow.

As stated 63-weeks ago, once the euphoria of the socialistic methods begin displaying its harsh reality on the reduced quality of life, rest assured the bear market will continue and with gusto. This is not technical. This is fundamental. You will see that prognosis continuing in spite of recent bullish behavior. This cycle should endure a double dip. However, the second dip may not occur until early next year after the “heart and soul” of bullish seasonality concludes around Feb 2010.

The above and below paragraph may become obsolete, based on Blue Dog Democrats upsetting the assumed control of Congress by socialists, communists, and creeps. If they back down and join the evil ones, then the paragraphs remain in tact.

The question remains, is public resistance to healthcare reform really from the grassroots? If so, and if its political influence results in cessation of the rampant stupidity in Washington D.C., the bull will find that too favorable to acquiesce to the bear on the immediate horizon. Although healthcare reform is garnishing most of the attention, cap and trade legislation will depress corporate profits, depress capitalistic adventurism, and thus will eventually depress the stock market.

As stated 58-weeks ago, “probabilities remain high that any bullish cycle will be followed by a deep bear market in 2009.” It is obvious there will be no bearish market in 2009. However, that threat remains, “if taxes are raised on the highly productive and capital gains, do not be surprised at a 1,000 Dow by 2010.” The bear has been passive since early March 2009, but it still has plenty of time to demonstrate its reflection of a souring culture. The Blue Dogs have upset this line of thinking and we will know more when Congressional behavior is demonstrated over the next few months.

As stated the past 15-weeks, on a positive note, it appears enough of the populace are influencing their political representatives to slow the progress of stupidity. If this happens, then bearish expectations of great magnitude will be muted.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 162.2% from its April 13, 2001 buy signal until the Mid-term Indicant sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Oct 16, 2009. It is up 1.7% since then, annualizing at 10.6%. It was solidly bearish last week, but merely priming the bull for yet more gains.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 4.9% since then, annualizing at 17.9%.

Vanguard Energy #18, VGENX, was up 144.9% from since the Mid-term Indicant buy signal April 5, 2003 until its sell signal on October 3, 2008. It is up 9.6%, annualizing at 26.0% since its buy signal on July 31, 2009.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003. It received a sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 18, 2009. It is down 4.5% since that buy signal.

State Street Research Global #9, SSGRX, was up 174.2% from its August 16, 2002 buy signal to the Mid-term Indicant sell on October 3, 2008. It is down 26.6% since that sell signal.

Fidelity Energy #39, FSENX, was up 81.2% since the Mid-term Indicant signaled buy on August 16, 2003 and the sell signal on October 3, 2008. It is up 1.2% since its buy signal on Sep 11, 2009, annualizing at 4.9%.

The Near-term Indicant and Quick-term Indicant signaled buy for ETF#03 – Energy and Natural Resources on Aug 3, 2009. It is up 7.0% since then, annualizing at 18.8%. It was up 242.4% (annualized at 44.8%) since its previous buy signal on March 26, 2003 until the September 2008 sell signal.

The Quick-term Indicant signaled buy for the GLD-ETF#11 on December 11, 2008. It is up 35.5% since that buy signal, annualizing at 34.8%. It gained 81.4% from its August 3, 2005 buy signal until the September 8, 2008 sell signal. Its annualized gain during that hold period amounted to 28.2%.  The Near-term Indicant signaled buy on April 24, 2009. It is up 21.8% since the Near-term buy signal, annualizing at 33.6%.

Mid-term Indicant Positions – Ten U.S. Indices

There were no new bull signals and no new bear signals.

The Mid-term Indicant signaled bull on July 31, 2009. The ten major indices are up by an average of 11.7% since that bull signal. That annualizes to 32.1%. Bear signals will occur in the event Congress passes healthcare legislation, turning it over to the most inefficient organization in the United States.

The Mid-term Indicant Dow Jones Industrial Average performance is at $30,075,198. That beats buy and hold performance of $1,593,108 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $143,928. That beats buy and hold’s $108,376 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $199,600. That beats buy and hold’s $75,947 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1787.8%, 32.8%, and 162.8%, respectively, for these indices as of this past week.

The Indicant’s percentage advantage over buy and hold does not change during bull signals. The advantage changes only during bear signals. That is because the buy and hold model has to keep holding, while the Mid-term Indicant model avoids bear markets. The only purpose of the Mid-term Indicant model is to avoid the bear markets. That is why it beat buy and hold by approximately 2,000% covering the past 100+ years. It will not be surprising to see the Mid-term Indicant outperform buy and hold by over 3,000% before the end of this decade. If the market remains bullish during this time, we’ll eat crow. It needs bears to outperform.

Click here for a tour of the Mid-term Indicant for major market indices.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

Click here for Mid-term Indicant Table of NASDAQ 100 Stocks.

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

Click here for Mid-term Indicant - Table of Dow Jones Industrial Average Stocks.

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

Click here for Mid-term Indicant - Dow Jones Utility Stocks Table.

Mid-term Indicant Positions - Indicant Selected Stocks  

Click here to see Indicant Select Stock Report Card history.

Click here for Mid-term Indicant Table of Indicant Selected Stocks.

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant signaled sell for ProFunds Ultra Short on April 3, 2009. It is down 51.5% since then. It remains too risky to buy since the Near-term Indicant Bull continues resisting bearish assaults. Although this is classically a post-election-year hold, current technical indicators are advising to avoid this fund until the Near-term bull cycle expires. However, this Near-term Bull is a thoroughbred.

Click here for Mid-term Indicant Table of Mutual Funds

Remember never to keep more than 20% of your investment resources into a single mutual fund. Sector investing in mutual funds is an extremely good way to mix your investments.

Long Term Indicant Positions - Dow Jones Industrial Average

The blue-chip Long-term Indicant Bull signal was at 2895 for the DJIA in November 1991. Keep in mind the Long-term Indicant generated only five bull/bear cycles since 1920.

The Dow is up 261.7% (annualized at 14.4%) since the Long-term Indicant signaled bull 945-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, inflation, and unreasonable interest rates have not been strong enough to signal bear since that bull signal. Even with today’s economy and stock market position, the 1991 investor is still up triple digit amounts, which remains above average performance when considering long-term planning.

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained on the website for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is included in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months. This report is in the next section and a mere repeat of the daily report you received on the last trading day of the week, which is usually on Friday evening.

Short-term Indicant Stock Market Report - Summary

As stated the last few days, until the major stock market indices and non-contrarian ETF’s interact with the NTI Bearish Green curve, the bull will remain in tact.

So far, fractionally non-contrarian ETF#03, XLE-Energy, is the only ETF with a collapsed NTI Blue Curve. This suggests a bias favoring the bull for both this ETF and the overall stock market.

Vector Pressures continue shifting bullishly, which adds support to non-bearishness. However, the strongest bull and weakest bull are both enduring negatively sloping Vector Pressures. This is mild threat to the overall stock market bull if this trend continues. Sometimes this inspires the bull and other attributes are suggesting such an inspiration to be executed by the bull.

In spite of the noted mild threats, short-term attributes remain in support of the overall stock market bull.

Near-term, Quick-term, Short-term Indicant Stock Market Details

The Near-term Indicant signaled no new bulls and no new bears.

All eleven major non-contrarian indices are up by an average of 25.5%, annualizing at 49.2%, since the NTI signaled bull an average of 27.0-weeks ago. The lone bear is the VIX and it is up 2.3% since its bear signal 1.3-weeks ago.

The Quick-term Indicant signaled no new bulls and no new bears.

Although there were no new bull signals, the Quick-term Indicant is signaling bull for 11-major indices. They are up 19.3%, annualizing at 38.2%, since their bull signals an average of 26.3-weeks ago.

The lone QTI bear, VIX, is down 39.8% since its bear signal 34.1-weeks ago.

The overall stock market remains configured without bearish threats. As stated last Monday, “on the contrary, do not be surprised at bullish behavior for the next few days. As stated last Tuesday, bearishness on Tuesday was silly nervousness. There are very few threats to the stock market short-term bull.” The stock market was indeed bullish, but mildly so, for the remainder of this week.

-Short-term Trend Sensitive Attributes (Includes Near-term and Quick-term)

      QTI-Red Bull Count; Unanimity with eleven supporting bullish bias.

      QTI-Bullish Red Curve Trend; Bullish unanimity with 11 of 11-non-contrarian indices in bullish trend, supporting bullish bias.

      QTI-Bearish Yellow Curve Trend; Non-bearish unanimity with 11 of 11-non-contrarian indices in non-bearish trend, supporting non-bearish bias.

      QIT-Yellow Bear Count; None of the non-contrarian’s are inflicted with this attribute and thus without any bearish bias.

      NTI-Blue Bull Count; Six, offering minority support for the NTI Bull.

      NTI-Bullish Blue Curve Trend;11-non-contrarian in bullish trend. VIX also in bullish trend, but nearing collapse.

      NTI-Bearish Green Curve Trend - Non-bearish majority with ten of 11-non-contrarian indices in bullish trend, supporting near-term non-bearishness. VIX also in bullish trend, but non-threatening.

      STI-Force Vector Cyclical Direction - Eight non-contrarian moving north, offering bullish bias.

      STI-Vector Pressure Trend-Minority of five non-contrarian moving bullishly, offering mild bullish support.

      Short-term Summary-Overall-Vector Pressure is shifting back to the north offering the bull to express its inspirational desires. The high number of QTI Red Bulls continue guarding against sustainable bearish aggression. Evidence of a major shift in directional intensity remains absent. That is bullish.

-Tangential Protection – Sep 1, 2009-Mon-Protection lines were constructed for Dow Transports, Dow Utilities, NASDAQ100, and S&P400. The S&P600-Index lost this protection during the week of November 9, 2009. These indices will not receive a Near-term bear signal until they fall below those tangential protection lines. The other indices will most likely receive bear signals when they fall below their NTI Green Curves with negatively sloping Vector Pressure. Near-term bear synergy cannot manifest until all indices are receiving a Near-term Bear signal. Since last March, the bull has responded when attributes neared bear signal justifications.

-Reverse Tangential Bearish Detection -  Although the current Near-term Bull has not yet expired, the following observations still holds true. The timing is unknown, but there is 100% confidence the indices and ETF’s will fall to those prices noted in the below link. (Note: You should not worry about this or consider this until you see the indices and ETF’s fall below the various attributes, such as the bearish yellow or green curves. The stock market can climb by significant magnitudes before the execution of this phenomenon).

-Political Climate – Quiet for the time being, which is fundamentally bullish. If you see political headlines regarding healthcare passage and/or cap and trade passage, be prepared for the bearish onslaught.

Click this sentence to the table, highlighting RTP’s (Reverse Tangential Projections). The values and magnitudes are expressed in the table on the website. Keep in mind there is 100% confidence in these bearish projections. The problem is not knowing when, but odds favor early next year. Much of this depends on political influences. There will be some unfavorable influences. There always is. The question is, when? As long as the aforementioned attributes are suggesting bullishness and non-bearishness, the bull will continue dominance.

Click the Short-term Indicant to see the combined table of the Near-term Indicant, Quick-term, and Short-term Indicant. The table has links to charts for each. Each chart contains all three models and there are two separate buy and sell signals for either the Near-term and/or Quick-term Indicant.

The tour is still being developed, but most of you are now familiar with the Near-term bull/bear cycles as well as the tangential protections and reverse tangential bearish detectors.

The NYSE and NASDAQ Indicant Volume Indicators  lethargic configuration continues slowing, but remaining unimpressive. Last Tuesday’s volume was a bit heavy on bearish aggression, but lighter than recent bullish aggressions. However, the Indicant Volume Indicator shows mild interest in shifting to a robust cycle. Behavior during robustness is an obviation of directional intensity. So far, there is not enough robustness, but interesting this uptick occurred with bearish aggression. Wednesday’s volume was relatively flat on mild bullishness, again obviating a continuation of current directional intensity, which remains bullish. Thursday’s volume was again flat on mild bullish behavior, continuing with the same theme of no impending shifts in directional intensity. That remains bullish. Friday’s volume was mild on flat/mixed stock market behavior. There remains little evidential interest in shifting bullish bias to bearish.

Short-term ETF Report Card, Status, and Charts

The Near-term Indicant generated no buy signals and no sell signals.

The Near-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 16.0%, annualizing at 48.8%, since their buy signals an average of 17.1-weeks ago.

The NTI is avoiding three-ETF’s. They are up 0.4% since their sell signals an average of 3.6-weeks ago.

The Quick-term Indicant generated no buy signals and no sell signals.

The Quick-term Indicant is signaling hold for 29-ETF’s. They are up an average of 24.7% since their buy signals an average of 27.4-weeks ago. Those with hold signals are annualizing at 46.9%.

The avoided ETF’s, are down by an average of 28.0% since their sell signals an average of 19.1-weeks ago.

Near-term Indicant ETF Key Attributes

NTI Blue Bulls Count; majority of 16-offering bullish support.

NTI Blue Curve Trend; 25-sloping north; strong bullish support.

NTI Green Curve Trend; 27-sloping north; strong majority support for non-bearishness. The bear cannot dominate with this configured attribute.

Quick-term Indicant ETF Key Attributes

QTI Red Bull Count; a majority of 26-support Quick-term bullishness.

QTI Bullish Red Curve Trend; 29-sloping north in solid majority support for Quick-term bullishness.

QTI Yellow Bear Count; zero non-contrarian represents a solid majority supporting Quick-term non-bearishness.

QTI Bearish Yellow Curve Trend;  28-sloping north, highlighting solid non-bearishness.

The Short-term Indicant ETF Key Attributes:

Force Vector Bullish Domain Occupancy; two in bullish domains, which is non-bearish.

Force Vectors Bearish Domain Occupancy; nine non-contrarian ETF’s in bearish offering the bear limited encouragement.

Vector Pressure Bullish Domain Occupancy; two in bullish domains, supporting bull.

Vector Pressure Trend; minority of 11-moving in bullish direction, supporting bull, while not inspiring the bear.

Short-term Summary: Most attributes remain non-bearish and bullish, but somewhat lazy.

Click here to get a quick overview of the regular mutual funds as they stood several months ago. As you can see, many of them are down by double digit percentage points since the Mid-term Indicant signaled sell in late 2007 and in early 2008. The Mid-term Indicant is updated each weekend with a link to the member’s section. Members can click this sentence to get a more recent update. You will notice buy signals the past few weeks for the first time in several months.

Click the below link to see today’s Near-term, Quick-term, and Short-term Indicant signals. Links on that page will take you to a single chart with all the model’s position on each ETF.

http://www.indicant.net/Members/Updates/STI-SQI-QTI-ETF-SumPage/0UD%20QTI-ETF0-Sum.htm

Contrarian Funds

ProFunds Ultra Short mutual fund moves inversely to the QQQQ by exponential amounts. See the Mid-term Indicant for its status.

The Near-term Indicant signaled sell for QID on November 16, 2009. It is up 0.9% since that sell signal. It remains configured for potential “short-term bullishness” but significantly more overall stock market bearish synergy is required to signal buy for this fund and QQQQ must demonstrate  interest in bearish behavior.

The Quick-term Indicant signaled sell for QID on March 26, 2009. It is down 54.6% since then. The Quick-term Indicant will not signal buy until it contacts the bearish yellow curve, which is valued at $28.94 and still falling.

ETF#03-Natural Resources   - The Near-term Indicant and Quick-term Indicant signaled buy on August 3, 2009. It is up 7.0% since those buy signals, annualizing at 19.3%. Its NTI Bullish Blue Curve collapsed on Dec 8, 2009. A sell signal will be released in the event NTI Green shifts to the south. It is getting close, but most likely preparing for a solid bullish response to this insult by the bear.

ETF#11-Gold and Precious Metals  is up 35.5% since the QTI signaled buy on December 11, 2008. Annualized growth is at 35.1%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $93.84 and still rising.

The Near-term Indicant signaled buy on Apr 24, 2009. It is up 21.8% since then, annualizing at 34.0%.

GLD’s recent bearishness is a simple profit-taking sell-off. Current configurations suggest a huge bounce within days. If it contacts NTI Green, buy call options. It is nearing a violent bullish response.

As stated for the last several months, gold remains fundamentally sound for long-term holding and a technical measure of authenticity in that assessment is in its bearish yellow curve. If it crosses below bearish yellow, you will not want to be holding.  The Quick-term Indicant will highlight that potential when this occurs.

ETF#14-TLT-Long Government  received a sell signal on Dec 4, 2009 from both the Near-term and Quick-term Indicant. It is down 1.3% since that sell signal.

Major ETF Events

Dec 11, 2009-GLD’s Force Vector is nearing a minimum suggesting a strong bullish bounce is imminent. It has not yet contacted bearish green, which offers a very high probability of loud bullishness. However, such a bounce is gaining in very high probabilities of success. That coupled with the behavior of XLE suggests strong bullishness on commodities in the next few days.

Dec 10, 2009-No major events.

Dec 9, 2009-No major events.

Dec 8, 2009-ETF#03-XLE NTI Bullish Blue Curve collapsed today. This is a contrarian ETF and not threatening to the overall stock market bull. A sell signal will be generated if and when NTI Green shifts bearishly with Force Vector residence in bearish domains.

Dec 7, 2009-None

Current Strategy-Short-term Indicant-Dec 11, 2009-Same as yesterday; the bull is not being threatened. Dec 10, 2009-Assume continuation of bull, as there are no significant bearish threats as of today. Dec 9, 2009-Bull is lazy, but remains a bull nonetheless. Dec 8, 2009-Overall stock market bull remains in tact in spite of today’s bearish aggression. Dec 7, 2009-Mon-Nothing different. Market remains bullish on a short-term basis. Dec 4, 2009-Fri-Attributes are again shifting in favor of the bull on a Near-term basis.

Click Quick-term Indicant, Near-term, and Short-term for all 31-ETF’s.

Other links:

Short-term Indicant for DJIA and NASDAQ

Short-term Indicant Tables for the Dow Jones Industrial Average Index

Short-term Indicant Table for the NASDAQ Composite Index

Indicant Volume Indicator

Near-term, Quick-term, and Short-term Indicant for Major Indices

Divergence versus Convergence

Last week was mostly flat with mild divergence due to falling commodities and relatively flat equities. The bull remains in tact, but somewhat boring right now.

Indicant Conclusion

As stated the past nine weeks, low interest rates offer narrowed alternative investment opportunities. The argument holds that sideline cash is not smart. As long as this perception prevails, the bull cycle should continue.

Configurations remain supportive of the current Short-term bull. As long as the Short-term bull remains in tact, there is no threat to the Mid-term Bull.

Keep up with the daily stock market report as the Quick-term and Near-term attributes can shift quickly.

Do not get lazy and set those stop losses for those stocks and funds that continue to enjoy hold signals.

The daily updates are on the following link.

http://www.indicant.net/Non-Members/Back%20Issues/QT.htm

Hyperlinks

To access all major markets, stocks, funds, economic data, charts, statuses, etc, click the following hyperlink:

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm 

Once you are inside the website, click on "members update" or simply log in. It is on the top of every page in the web site so you can always find your way back.

Happy Investing,

www.indicant.net

12/13/09

Dec 6, 2009 Indicant Weekly Stock Market Report

Volume 12, Issue 01 ISSN 1526 6516 © The Indicant Stock Market Report

Mysticism in Demand – Global Warming’s Replacement

The historical record does not do a good job identifying the first witch doctor. One could speculate or maybe even uncover some special bones and feathers. Without a time machine that will take one back in time, elements identifying the first witch doctor requires speculation.

The historical record suggests two primary groups of people were either hunters and gatherers or farmers. As the population grew, those two groups did not get along that well. This squabbling led to the formation of armies to settle disputes. History suggests that total annihilation of one group by another group was how some disputes were settled. The modern term for that is ethnic cleansing.

Any organization requires leadership. The purpose of any organization is irrelevant. An organization occurs when two or more people band together for a cause. Regardless of the number of people in an organization, leaders evolve. Leaders evolve as a function of the number of followers they can accumulate.

Leaders make proclamations. Adolph Hitler proclaimed a superior race. The masses followed their leader, Adolph. Those who followed Adolph paid a severe price. Followers generally pay a price for their weakness, regardless if the cause was right or wrong.

Simple math suggests there are more followers than leaders. Followers are groups of people, who do not know what to believe or do. They seek a leader to tell them what to do or believe. Leaders tend to seek the company of weaker individuals.

It is amazing to see large crowds of people gathering to listen to a full time politician make a speech. Those people are weak, seeking someone to follow. The words flowing from a full time politician are much like that of a witch doctor. There is absolutely no substance to it. Politicians add zero economic value. They actually subtract from economic value. Politician’s underlying purpose is mere ego gratification.

The likes of Thomas Jefferson, James Madison, and others during their era were “part time” politicians. They all had other occupations and were extraordinarily talented. They had broader perspectives on reality and more or less documented a way of life that is consistent with reality. Birthright to power and possession was one of many elements they disdained. Their claim that all men are created equal was well received.

Those “part-time” politicians did not suggest that all men stayed equal after birth. From time to time, politicians see potential in vote getting when they claim all men remain equal from birth to death. That claim draws bigger crowds and more votes. Egotistical gratification then fulfills the needs of the politician. That is the sole reason of boasting their leadership.

The truly talented work on producing objects. The truly talented offer their objects in return for compensation. Buyers reward the truly talented by buying their goods or services. Politicians on the other hand produce absolutely nothing of value. They never have and they never will. Paying people to be full time politicians is a stupid idea. For example, Congress should be in session only during times of international conflict. They should be paid for their time; about the same as jury duty, plus expenses. However, there would be no reimbursements for first class. Coach fare would be fine.

To garnish high pay and low effort employment in the government, politicians convey to voters higher “sound good/feel good” causes. Global warming was a perfect such cause. It is difficult to prove and disprove. A huge number of followers enjoy the mysticism of global warming.

Most do not like being encumbered with the exacting requirements of producing a product or service that clearly and immediately identifies success or failure. The possibility of failure is too burdensome for most. Followers and leaders of mysticism enjoy perpetual unknowns. The exactness of right or wrong is confrontational to the needs of ego.  Followers have a need for a cause more important than themselves. Followers are miserable souls, who cannot face their own inadequacies and thus march around, making nonsensical noise, about higher causes.

Social cultures come and go. Those expiring the quickest were obviously out of synch with reality. That is easily proven. Reality is what is! Extinction no longer is! The sources of extinction are one of two things; inflexibility or mysticism. When discussing humans, mysticism is the direct cause of inflexibility.

In the summer of 1929, the Smoot-Hawley tariff bill was passed. The stock market peaked shortly after that bill. Fulltime politicians, who were obviously supported by followers, developed the bill. The bill was shrouded in mysticism. Those followers paid the price and many of the children and brothers of those followers died in World War II as a direct result of the follower’s stupidity in electing the stupid fulltime politicians to represent their “sound good/feel good” messages.

A few months later in September 1929, a prominent Harvard economist stated the stock market was at permanently high levels and forecasted a resumption of yet higher stock prices. Two years later stock prices were down 80%. It was not until a quarter of a century later before the stock market returned to 1929 levels. The Harvard professor obviously had no model and one can speculate that his ego gratification is what motivated his erroneous prognosis.

To view the facts, click this sentence.

All of that mysticism by politicians and their followers indirectly led to WWII.

The U.S. populace continues electing Harvard graduates to high political offices. FDR was among the same Harvard genre as the Harvard professor. That institution must have been very high in the promotion of mysticism during that era. A contemporary view suggests a continuation of that mysticism. (Note: There are many good people, who have attended Harvard and other Ivy League schools. This should not be considered as stereotypical all people from those institutions).

Although global warming is difficult to prove or disprove, one can easily notice that temperatures elevate as more people arrive to the conference room. In other words, temperature rises when more living people and/or animals are in a confined area.

The same people who promote global warming get all sniffled when a species of animal is nearing extinction. Delaying the extinction of an animal that cannot adapt adds to the world’s population of the living and possibly contributing to global warming. In other words, if one wishes to promote solutions to global warming, then one should support the normal extinction process of animals. Of course, that conflicts with “sound good/feel good” views.

If the polar bear cannot adapt, then it should become extinct. That has been going on since the beginning and it will continue. Polar bears should not stand in the way of a human’s right to the pursuit of happiness. Polar bears, like it or not, are mere animals that will be replaced by other animals when and if the bears become extinct.

Those that promote the cause of global warming are directly creating it by their “sound good/feel good” stupid philosophies shrouded in mysticism. Supporting the inflexible only adds to the warming effects of the earth.

Polar bears will not deflect an incoming asteroid, while humans have a chance to deflect it. The humans that deflect it are those who avoid any mystical belief systems for if they did not, the asteroid results in their extinction.

Global warming mystics are a direct insult and threat to the continuation of life, liberty, and the pursuit of happiness of humans. Those part-time politicians who laid out the framework of life did not give this right to polar bears. Reality has always and will always hold one truth; adapt or die. Reality has always promoted the concept of life, liberty, and happiness for human beings and only human beings. After all, human beings eat more animals than the other way around.

The question is, “will it rain on your house one week from today?” Scientists who can answer that question 100% accurately for the next 52-weeks are the ones who can earn credibility. If they cannot answer that question 100% accurately for the next 52-weeks, how can they be highly regarded in their assertions?  

If global warming dissipates into the halls of stupidity, where it belongs, rest assured the parasitical elite and members of the economic overhead group will find another cause for the purpose of accumulating pitiful followers to their egotistical, control freak desires. Global warming and healthcare are not the last causes from non-value-adding members of society.

Keep your eye on the daily stock market report.

Weekly Buy/Sell Summary – Stocks and Funds – Mid-term Indicant

Click this sentence for a graphical summary of what follows. Simply scroll down the page to see graphical and detail content of this section.

The Mid-term Indicant generated twelve buy signals and no sell signals.

The Mid-term Indicant is signaling hold for 189 of the 333-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 29.1%. That annualizes to 50.2%. The Mid-term Indicant has been signaling hold for these 189-stocks and funds for an average of 30.1-weeks.

The Mid-term Indicant is avoiding 116-stocks and funds of 333- tracked by the Indicant. The avoided stocks and funds are down an average of 37.5% since the Mid-term Indicant signaled sell an average of 86.0-weeks ago.

The letters, NLT, identify stocks and funds no longer traded. We used to use the last signal at the time of the last trade to maintain consistencies in the report card. However, we expect several corporations to fail or merge in the coming months and years. Marking such failures with the letters, NLT, will not disrupt the report card. We can then more quickly identify replacements for those that have failed or merged into another company. NLT companies and funds are excluded from the report card summaries at the time of being classified as NLT. However, the report card’s historical record is not adjusted. It always reflects the recommendations and performance as it stood at the time of said performance and recommendations.

One year ago, on Dec 5, 2008, the Mid-term Indicant was holding 27-stocks and funds out of 344 tracked for an average of 45.8-weeks. They were up by an average of 71.7% (annualized at 81.3%). There were 315-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 36.5% since their respective sell signals an average of 28.5-weeks earlier.

The Mid-term Indicant was signaling hold for 235-stocks and funds of the 345-tracked two years ago on Dec 7, 2007. They were up by an average of 157.0% (annualized at 62.5%) since their respective buy signals an average of 131.5-weeks earlier. The Mid-term Indicant was avoiding 109-stocks and funds at that time. They were down an average of 5.2% since their respective sell signals an average of 15.7-weeks earlier.

There were 311-stocks and funds with hold signals on Dec 01, 2006 since their buy signals an average of 84.3-weeks earlier. They were up by an average of 113.1% (annualized at 69.7%). There were 31-avoided stocks and funds at that time. They were down by an average of 12.0% from their respective sell signals an average of 19.8-weeks earlier.

On Dec 2, 2005, the Mid-term Indicant was signaling hold for 268-stocks and funds out of 320-tracked. They were up by an average of 97.6% (annualized at 62.1%) since their buy signals an average of 81.7-weeks earlier. The Mid-term Indicant was avoiding 47-stocks and funds at that time. They were down by an average of 17.1% since their sell signals an average of 27.5-weeks earlier.

Five years ago, on Dec 3, 2004, there were 301-hold signals for stocks and funds out of the 320 tracked by the Mid-term Indicant at that time. They were up an average of 69.8% (annualized at 67.1%) since their respective buy signals an average of 54.1-weeks earlier. There were 17-avoided stocks and funds then. They were down an average of 44.3% since their respective sell signals an average of 56.3-weeks earlier.

On Dec 5, 2003, there were 271-stocks and funds with hold signals from the listing of 296-tracked by the Mid-term Indicant at that time. They were up an average of 53.7%, annualizing at 84.0%, since the buy signals an average of 35.4-weeks earlier. There were 14-avoided stocks and funds then. They were down by an average of 24.9% since their sell signals an average of 35.4-weeks earlier.

There were 286-stocks and funds with hold signals on Dec 6, 2002. They were up by an average of 16.2%, annualizing at 81.0%, since their buy signals 10.4-weeks earlier. The nine-avoided stocks and funds were down an average of 30.0% since their respective sell signals an average of 22.4-weeks earlier.

Summary of Stocks and Funds with Buy and Sell Signals This past Week

To maintain appropriate security, you can see the Mid-term Indicant "buy/sell" signals for stocks and funds for this week by clicking the following link. It is in the member’s only section.

Click this link to this week’s buy and sell signals.

As repeatedly stated, do not hold more than 10% of your investment resources in a single stock and do not hold more than 20% of your investment resources into a single mutual fund. Also, never fall in love with a stock or fund. Only love the value of your portfolio. Never love its contents. Management stupidity can wreak havoc on any stock or fund at any time. Socio-economic interference can devastate your holdings from time to time. Congressional behavior can have immediate and long-lasting unfavorable influences on the capital markets.

Some companies will perform well, regardless of the depth of the bear market. Buy signals will be muted if Congressional action threatens the capital markets. Legislation, regulation, and politicians are the biggest threat to the stock market bull.

All updated information can be accessed from the following link. You will need your login ID and password.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20Summary.htm

Comments about Mid-term Indicant Buy and Sell Signals This Weekend

The Long-term, Mid-term, Quick-term, Near-term, and Short-term attributes describing trend are all bullish. The economy is on the mend and earnings should improve. The market may be a bit ahead of earnings potential, but the bullish trends have not been upset, yet. The biggest threat on the immediate horizon is Congressional action. The bull prefers governmental inaction. International loan defaults also threaten the bull.

As stated last week, the Mid-term Indicant is poised for several more buy signals in the next few weeks. The Short-term Indicant ridded itself of the few remaining attributes supporting bearish ambition last week.

The bull’s duration is not known. There are no indications it is ready to expire.

Click the following link that will take you to the Near-term, Quick-term, and Short-term Indicant models.

http://www.indicant.net/Members/Updates/STI-Mkts/STI-10-Indices/STI08.htm

Stop Loss Management

The Mid-term Indicant recommends a trailing stop loss of 8% due to the Near-term, Quick-term, Short-term Indicant signaling bullish bias while the Mid-term Indicant is also favoring bullish expectations.

For your longer-term holdings where you are enjoying triple and quadruple digit gains, you may want to set your stop at the bearish yellow price.

For new buys, set stop losses at the blue or green values in the tables. If green is deeply lagging the prevailing price, you may want to average the blue and green prices for your stop losses.

Most of the longer-term signals of stocks and funds continue with “avoid” signals, but a few are still holding. The risk of continued holding, for the likes of Apple, remains relaxed. Other previously strong companies, such as RIMM, are in trouble. The Mid-term Indicant continues avoiding RIMM.

The ETF’s are signaled on the Near-term, Quick-term, and Short-term Indicant and are updated daily. These shorter-term models participate in bullish spurts and rallies, while the Mid-term Indicant is focused on fundamentals and longer-term technical data.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 42.6% since its secular weekly low on October 9, 2002. The NASDAQ is up 97.0% and the S&P500 is up 42.4% since then. The small cap index, S&P600, is up 86.0% since October 9, 2002. All of the major indices were at new lows on the same week in 2002, which is a common attribute for bottoming.

Most major indices last cyclical bottom occurred on March 9, 2009. That includes the four major Dow Indices, the NASDAQ and all of the major S&P Indices. The only exception is the NASDAQ100. It encountered its weekly bottom on November 20, 2008. The resilience of the current Near-term Bull cycle suggests it may indeed have enough sustainability to establish a major cyclical bottom. In other words, the next Near-term Bear cycle may not fall below the March 9, 2009 bottoming. Even with that, statistics supported by 100% accuracy the Reverse Tangential Projections will occur at some future point. Those projections are above these cyclical bottoms, but well below prevailing prices.

The Dow is down 26.7% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 23.3% since its last peak on Oct 31, 2007. The S&P600-small cap index is down 28.7% since its last closing peak on Jul 19, 2007. Bull market expirations are not as obviating with simultaneous peaking like bear markets are with simultaneous bottoming among the major indices.

There is one major point here. If the Near-term Indicant is signaling avoid, all short-term traders should be avoiding, in spite of the potential optimism of not finding a new bottom in the next bear cycle. The longer-term trader should continue patiently awaiting buying clearance from the Mid-term Indicant. There have been quite a few of them the past few months, but muted the past few weeks with Congressional threats to capitalism. Older and strategic longer-term traders are still up by triple digits from the 1991 bull signal by the Long-term Indicant.

The NASDAQ is down 56.5% since its last weekly secular peak on March 9, 2000. The S&P500 is down 27.6% since its similar secular peak on March 23, 2000. The Dow is down by 11.4% since January 13, 2000 when it peaked from the 1990’s roaring bull. As stated the past several years in this report, do not be surprised at the NASDAQ equaling its March 9, 2000 high until after 2025. (This remains even with the immediate Blue Dog potential).

As socialism increases, the NASDAQ may not hit its 2000 peak until after 2050. Even that depends on resurgence in entrepreneurialism and related capitalism. Politicians screwed up the economy and the majority apparently believes their proposed fixes. All democracies eventually fail by virtue of tyranny by the stupid majority. We may be witnessing the early stages of that phenomenon.

Politicians are now attempting to impose more constraints on business expansion and thus the continuation of wealth destruction should not be surprising. Politicians have deemed obsolete the normal efficiencies of capitalistic cleansing of the incompetent. That will wear down the capital markets as politicians continue their neurotic desires to expand their influence and controls. Those leeches will eventually kill their host, but like all leeches, they continue on sucking away.

The Dow is up 18.4% so far this year. The NASDAQ is up 39.1% and the S&P500 is up by 22.4%. Keep in mind the post election year is the most bearish and has lost money since 1832. The stock market is not conforming to this historical standard at this time, just as it did not conform in last year’s election year, which is normally bullish.

The NASDAQ year-to-date performance was bearish by 20.5% through this week in 2001. Keep in mind the NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness. So far, the NASDAQ is incongruent with historical standards in this post election year of 2009.

The NASDAQ was down by 26.7% through this weekend in 2002. Some of you recall the dynamic bear market in 2002, where the NASDAQ finished that year down by 31.5%. The bear cycle found bottom in October 2002, which is consistent with the mid-term year’s historical standards.

The NASDAQ YTD 2003 performance was up by 47.4%. It finished up in that solidly bullish year by 50.0%, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 7.2% and finished up by 8.6% for that year, which was congruent with election year bullishness, although shy of magnitude standards. 

It was up 4.5% in 2005’s post election year, which contradicted historical standards of losses and/or minimal gains. Many of you recall that 2004 and 2005 were meandering bear markets. 2005’s post election year finished up by a mere 1.4%, which was an excellent year based on post election year historical standards of bearishness.

In 2006, the NASDAQ was up 11.0% on this weekend and finished that year with a 9.5%-gain, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 8.5% at this time in 2007 and finished that year in positive territory by 9.8%, which was consistent with pre-election year bullishness. It was down 45.5% at this time last year. The NASDAQ finished down by 40.5% in 2008. That was contrarian performance to historical election year bullishness and the most bearish presidential election year since related records from 1832.

So far, this presidential post election year is performing inconsistently with historical standards. It continues to be bullish in the face of historical bearishness. Last year’s inconsistency is somewhat influential. Variant directional intensity in one year quite often is succeeded with the opposite variant with similar magnitude in the following year.

The capital markets understand socio-political influences are predominant in the first year of most incoming administrations and thus generally non-bullish with an actual demonstration of outright bearishness in presidential post election year. As the popularity of Congress and the U.S. President wane, the stock market senses a reduction in their power. That is bullish.

Politicians offer nothing pertinent to the quality of life, including health or wealth. They “talk about it” but just one RN offers more toward health and one good entrepreneur offers more toward wealth than the collection of all politicians, kings, queens, and dictators since the beginning of time. Those “control freaks” only talk and rob folks of their wealth and health.

The Short-term Indicant continues signaling bull in spite of the market’s historical standards and current incongruence to those standards.

Keep your eye on the daily stock market report.

Economic Conditions – Inflation, Currency, Interest Rates

Click the above heading for a summary of hard economic indicators.

Short-term rates remain configured at cyclical minimums. Normally, that would threaten the bull, as rate hikes typically follow cyclical minimums. However, they are so low the immediate prognosis borders minutia. In essence, potential rate hikes are irrelevant to the stock market at this time at these levels. The Fed’s current strategy is to maintain low rates, conflicting with the normalcy of rate hikes during economic recovery.

Oil prices continue vacillating in a range the Saudi Kingdom finds comfortable. As previously stated, the kingdom will assert its leadership and regulate supplies to demands that will result in approximately $80/bbl for a lengthy period.

Several weeks ago, commodities began their elevation into the neutral zone from their bullish mini-cycle. Bearish yellow is now in a solid cyclical shift to the north. That should incite a period of indecisiveness, which is occurring now. Improving economic conditions and the potential for inflation suggests commodities are a good long-term investment. Gold is a Red Bull and setting record highs. As stated for several months, gold is a solid long-term investment. It measures regulator incompetence, which is accelerating, and maintains value relative to political interference and deteriorated commerce.

The U.S. Dollar continues to cyclically weaken.

Gold is obviously anticipating significant inflationary behavior with paper currencies. It is also buffering portfolios against governmental policies around the world. A tremendous amount of paper currency has been added to circulation well ahead of the productive efforts normally required to support those levels. Inflation has to follow at some future point. Increased socialism will inherently reduce supply, while paper money in the hands of the incompetent and non-productive will increase demand. At some future point, an I-Pod may cost well over $10,000. Only the “established elite” will enjoy those sort of possessions, while the masses will have to relearn the drumbeats from their primordial past. Once that nonsensicality has passed, deflation will most likely follow.

As stated 62-weeks ago, once the euphoria of the socialistic methods begin displaying its harsh reality on the reduced quality of life, rest assured the bear market will continue and with gusto. This is not technical. This is fundamental. You will see that prognosis continuing in spite of recent bullish expressions. This cycle should endure a double dip. However, the second dip may not occur until early next year after the “heart and soul” of bullish seasonality concludes around Feb 2010.

The above and below paragraph may become obsolete, based on Blue Dog Democrats upsetting the assumed control of Congress by socialists, communists, and creeps. If they back down and join the evil ones, then the paragraphs remain in tact.

The question remains, is public resistance to healthcare reform really from the grassroots? If so, and if its political influence results in cessation of the rampant stupidity in Washington D.C., the bull will find that too favorable to acquiesce to the bear on the immediate horizon. Although healthcare reform is garnishing most of the attention, cap and trade legislation will depress corporate profits, depress capitalistic adventurism, and thus will eventually depress the stock market.

As stated 57-weeks ago, “probabilities remain high that any bullish cycle will be followed by a deep bear market in 2009.” It is obvious there will be no bearish market in 2009. However, that threat remains, “if taxes are raised on the highly productive and capital gains, do not be surprised at a 1,000 Dow by 2010.” The bear has been passive since early March 2009, but it still has plenty of time to demonstrate its reflection of a souring culture. The Blue Dogs have upset this line of thinking and we will know more when Congressional behavior is demonstrated over the next few months.

As stated the past 14-weeks, on a positive note, it appears enough of the populace are influencing their political representatives to slow the progress of stupidity. If this happens, then bearish expectations of great magnitude will be muted.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 162.2% from its April 13, 2001 buy signal until the Mid-term Indicant sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Oct 16, 2009. It is up 5.3% since then, annualizing at 38.6%. It has been bullish the past four weeks.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 12.3% since then, annualizing at 48.8%.

Vanguard Energy #18, VGENX, was up 144.9% from since the Mid-term Indicant buy signal April 5, 2003 until its sell signal on October 3, 2008. It is up 11.3%, annualizing at 32.2% since its buy signal on July 31, 2009.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003. It received a sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 18, 2009. It is down 4.4% since that buy signal.

State Street Research Global #9, SSGRX, was up 174.2% from its August 16, 2002 buy signal to the Mid-term Indicant sell on October 3, 2008. It is down 27.4% since that sell signal.

Fidelity Energy #39, FSENX, was up 81.2% since the Mid-term Indicant signaled buy on August 16, 2003 and the sell signal on October 3, 2008. It is up 1.4% since its buy signal on Sep 11, 2009, annualizing at 6.0%.

The Near-term Indicant and Quick-term Indicant signaled buy for ETF#03 – Energy and Natural Resources on Aug 3, 2009. It is up 7.7% since then, annualizing at 22.4%. It was up 242.4% (annualized at 44.8%) since its previous buy signal on March 26, 2003 until the September 2008 sell signal.

The Quick-term Indicant signaled buy for the GLD-ETF#11 on December 11, 2008. It is up 41.3% since that buy signal, annualizing at 41.3%. It gained 81.4% from its August 3, 2005 buy signal until the September 8, 2008 sell signal. Its annualized gain during that hold period amounted to 28.2%.  The Near-term Indicant signaled buy on April 24, 2009. It is up 26.8% since the Near-term buy signal, annualizing at 43.1%.

Mid-term Indicant Positions – Ten U.S. Indices

There were no new bull signals and no new bear signals.

The Mid-term Indicant signaled bull on July 31, 2009. The ten major indices are up by an average of 11.0% since that bull signal. That annualizes to 32.1%. Bear signals will occur in the event Congress passes healthcare legislation, turning it over to the most inefficient organization in the United States.

The Mid-term Indicant Dow Jones Industrial Average performance is at $29,837,962. That beats buy and hold performance of $1,580,542 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $143,872. That beats buy and hold’s $108,334 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $199,968. That beats buy and hold’s $76,087 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1787.8%, 32.8%, and 162.8%, respectively, for these indices as of this past week.

The Indicant’s percentage advantage over buy and hold does not change during bull signals. The advantage changes only during bear signals. That is because the buy and hold model has to keep holding, while the Mid-term Indicant model avoids bear markets. The only purpose of the Mid-term Indicant model is to avoid the bear markets. That is why it beat buy and hold by approximately 2,000% covering the past 100+ years. It will not be surprising to see the Mid-term Indicant outperform buy and hold by over 3,000% before the end of this decade. If the market remains bullish during this time, we’ll eat crow. It needs bears to outperform.

Click here for a tour of the Mid-term Indicant for major market indices.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

Click here for Mid-term Indicant Table of NASDAQ 100 Stocks.

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

Click here for Mid-term Indicant - Table of Dow Jones Industrial Average Stocks.

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

Click here for Mid-term Indicant - Dow Jones Utility Stocks Table.

Mid-term Indicant Positions - Indicant Selected Stocks  

Click here to see Indicant Select Stock Report Card history.

Click here for Mid-term Indicant Table of Indicant Selected Stocks.

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant signaled sell for ProFunds Ultra Short on April 3, 2009. It is down 51.5% since then. It remains too risky to buy since the Near-term Indicant Bull continues resisting bearish assaults. Although this is classically a post-election-year hold, current technical indicators are advising to avoid this fund until the Near-term bull cycle expires. However, this Near-term Bull is a thoroughbred.

Click here for Mid-term Indicant Table of Mutual Funds

Remember never to keep more than 20% of your investment resources into a single mutual fund. Sector investing in mutual funds is an extremely good way to mix your investments.

Long Term Indicant Positions - Dow Jones Industrial Average

The blue-chip Long-term Indicant Bull signal was at 2895 for the DJIA in November 1991. Keep in mind the Long-term Indicant generated only five bull/bear cycles since 1920.

The Dow is up 258.9% (annualized at 14.3%) since the Long-term Indicant signaled bull 944-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, inflation, and unreasonable interest rates have not been strong enough to signal bear since that bull signal. Even with today’s economy and stock market position, the 1991 investor is still up triple digit amounts, which remains above average performance when considering long-term planning.

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained on the website for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is included in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months. This report is in the next section and a mere repeat of the daily report you received on the last trading day of the week, which is usually on Friday evening.

Short-term Indicant Stock Market Report - Summary

As stated the last few days, until the major stock market indices and non-contrarian ETF’s interact with the NTI Bearish Green curve, the bull will remain in tact.

Some Vector Pressures are starting to shift bullishly, which adds support to non-bearishness. Many ETF’s are again above Near-term Bullish Blue Curve, suggesting added support for the continuation of the bull.

Short-term attributes identify no threats bull market.

Near-term, Quick-term, Short-term Indicant Stock Market Details

The Near-term Indicant signaled no new bulls and no new bears.

All eleven major non-contrarian indices are up by an average of 25.0%, annualizing at 50.0%, since the NTI signaled bull an average of 26.0-weeks ago.

The Quick-term Indicant signaled no new bulls and no new bears.

Although there were no new bull signals, the Quick-term Indicant is signaling bull for 11-major indices. They are up 18.8%, annualizing at 38.6%, since their bull signals an average of 25.3-weeks ago.

The lone QTI bear, VIX, is down 40.5% since its bear signal 33.1-weeks ago. VIX eclipsed bearish yellow on Thursday, Oct 29, 2009, technically qualifying for a Quick-term Bull signal, but the overall stock market remained absent from enough bearish attributes to allow a QTI bull signal. The VIX is no longer bullishly configured. The overall stock market remains configured without bearish threats. On the contrary, do not be surprised at bullish behavior for the next few days.

-Short-term Trend Sensitive Attributes (Includes Near-term and Quick-term)

      QTI-Red Bull Count; Unanimity of eleven support bullish bias.

      QTI-Bullish Red Curve Trend; Bullish unanimity with 11 of 11-non-contrarian indices in bullish trend, supporting bullish bias.

      QTI-Bearish Yellow Curve Trend; Non-bearish unanimity with 11 of 11-non-contrarian indices in non-bearish trend, supporting non-bearish bias.

      QIT-Yellow Bear Count; None of the non-contrarian’s are inflicted with this attribute and thus without any bearish bias.

      NTI-Blue Bull Count; Seven, offering majority support for the NTI Bull.

      NTI-Bullish Blue Curve Trend;12-non-contrarian in bullish trend. VIX also in bullish trend, but teetering on collapse.

      NTI-Bearish Green Curve Trend - Non-bearish majority with ten of 11-non-contrarian indices in bullish trend, supporting near-term non-bearishness. VIX also in bullish trend, but non-threatening.

      STI-Force Vector Cyclical Direction - Eight non-contrarian moving north. New bull cycle forming and for those not yet shifted are bearishly mature, offering a slight edge to the bull.

      STI-Vector Pressure Trend-Minority of four moving bullishly, offering limited non-bearishness, but shifting in favor of the bull.

      Short-term Summary-Overall-Vector Pressure is shifting back to the north offering the bull to express its inspirational desires. The high number of QTI Red Bulls continue guarding against sustainable bearish aggression. So, there is little evidence of a major shift in directional intensity, which is bullish.

-Tangential Protection – Sep 1, 2009-Mon-Protection lines were constructed for Dow Transports, Dow Utilities, NASDAQ100, and S&P400. The S&P600-Index lost this protection during the week of November 9, 2009. These indices will not receive a Near-term bear signal until they fall below those tangential protection lines. The other indices will most likely receive bear signals when they fall below their NTI Green Curves with negatively sloping Vector Pressure. Near-term bear synergy cannot manifest until all indices are receiving a Near-term Bear signal. Since last March, the bull has responded when attributes neared bear signal justifications.

-Reverse Tangential Bearish Detection -  Although the current Near-term Bull has not yet expired, the following observations still holds true. The timing is unknown, but there is 100% confidence the indices and ETF’s will fall to those prices noted in the below link. (Note: You should not worry about this or consider this until you see the indices and ETF’s fall below the various attributes, such as the bearish yellow or green curves. The stock market can climb by significant magnitudes before the execution of this phenomenon).

-Political Climate – Quiet for the time being, which is fundamentally bullish. If you see political headlines regarding healthcare passage and/or cap and trade passage, be prepared for the bearish onslaught.

Click this sentence to the table, highlighting RTP’s (Reverse Tangential Projections). The values and magnitudes are expressed in the table on the website. Keep in mind there is 100% confidence in these bearish projections. The problem is not knowing when, but odds favor early next year. Much of this depends on political influences. There will be some unfavorable influences. There always is. The question is, when? As long as the aforementioned attributes are suggesting bullishness and non-bearishness, the bull will continue dominance.

Click the Short-term Indicant to see the combined table of the Near-term Indicant, Quick-term, and Short-term Indicant. The table has links to charts for each. Each chart contains all three models and there are two separate buy and sell signals for either the Near-term and/or Quick-term Indicant.

The tour is still being developed, but most of you are now familiar with the Near-term bull/bear cycles as well as the tangential protections and reverse tangential bearish detectors.

The NYSE and NASDAQ Indicant Volume Indicators  lethargic configuration is now slowing. A robust configuration will not be surprising in the next few days, but some portions will be due seasonal volumes. The charts are not seasonally adjusted. Monday‘s mild bullish behavior was accompanied with mild volume, suggesting little interest in trend or cyclical shifts in directional intensity, which remains bullish. Tuesday’s volume was a bit more aggressive on strong stock market bullishness. Again, there is little market interest in shifting directional intensity from bullish to bearish. Wednesday’s volume was mild on mixed stock market behavior. Again, volume is offering no evidence of shift in direction. Thursday’s volume was interesting. The big board’s volume was significantly higher than norms while the NASDAQ volume was mildly less than the norm. Mild bearish behavior, though, is not enough to be concerned about shifts in directional intensity from a volume perspective. Friday’s volume was higher than normal with mild bullish conclusions after strong bullishness earlier in the day. Bullish emotion on that waned as the day wore on, but the higher volume is significant. Those buyers will not be quick sellers and thus bullish bias prevails.

Short-term ETF Report Card, Status, and Charts

The Near-term Indicant generated no buy signals and one sell signal.

The Near-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 16.2%, annualizing at 52.6%, since their buy signals an average of 16.1-weeks ago.

In addition to the sell signal, the NTI is avoiding two-ETF’s. They are up by an average of 2.3% since their sell signals an average of 3.9-weeks ago.

The Quick-term Indicant generated no buy signals and one sell signal.

The Quick-term Indicant is signaling hold for 29-ETF’s. They are up an average of 25.0% since their buy signals an average of 26.4-weeks ago. Those with hold signals are annualizing at 49.3%.

The lone avoided ETF, QID, is down 54.5% since its sell signal an average of 36.1-weeks ago.

Near-term Indicant ETF Key Attributes

NTI Blue Bulls Count; majority of 22-offering solid bullish support.

NTI Blue Curve Trend; 29-sloping north; strong bullish support.

NTI Green Curve Trend; 29-sloping north; strong majority support for non-bearishness. The bear cannot dominate with this attribute.

Quick-term Indicant ETF Key Attributes

QTI Red Bull Count; a majority of 27-support Quick-term bullishness.

QTI Bullish Red Curve Trend; 28-sloping north in solid majority support for Quick-term bullishness.

QTI Yellow Bear Count; zero non-contrarian represents a solid majority supporting Quick-term non-bearishness.

QTI Bearish Yellow Curve Trend;  28-sloping north, highlighting solid non-bearishness.

The Short-term Indicant ETF Key Attributes:

Force Vector Bullish Domain Occupancy; five in bullish domains, which is non-bearish.

Force Vectors Bearish Domain Occupancy; zero non-contrarian ETF’s in bearish domains no longer offering the bear encouragement.

Vector Pressure Bullish Domain Occupancy; two in bullish domains, supporting bull.

Vector Pressure Trend; minority of seven moving in bullish direction, supporting bull, while not inspiring the bear.

Short-term Summary: Most attributes remain non-bearish and increasingly bullish.

Click here to get a quick overview of the regular mutual funds as they stood several months ago. As you can see, many of them are down by double digit percentage points since the Mid-term Indicant signaled sell in late 2007 and in early 2008. The Mid-term Indicant is updated each weekend with a link to the member’s section. Members can click this sentence to get a more recent update. You will notice buy signals the past few weeks for the first time in several months.

Click the below link to see today’s Near-term, Quick-term, and Short-term Indicant signals. Links on that page will take you to a single chart with all the model’s position on each ETF.

http://www.indicant.net/Members/Updates/STI-SQI-QTI-ETF-SumPage/0UD%20QTI-ETF0-Sum.htm

Contrarian Funds

ProFunds Ultra Short mutual fund moves inversely to the QQQQ by exponential amounts. See the Mid-term Indicant for its status.

The Near-term Indicant signaled sell for QID on November 16, 2009. It is up 1.2% since that sell signal. It remains configured for potential “short-term bullishness” but significantly more overall stock market bearish synergy is required to signal buy for this fund and QQQQ must demonstrate  interest in bearish behavior.

The Quick-term Indicant signaled sell for QID on March 26, 2009. It is down 54.5% since then. The Quick-term Indicant will not signal buy until it contacts the bearish yellow curve, which is valued at $29.38 and still falling.

ETF#03-Natural Resources   - The Near-term Indicant and Quick-term Indicant signaled buy on August 3, 2009. It is up 7.7% since those buy signals, annualizing at 22.4%.

ETF#11-Gold and Precious Metals  is up 41.0% since the QTI signaled buy on December 11, 2008. Annualized growth is at 41.3%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $92.98 and still rising.

The Near-term Indicant signaled buy on Apr 24, 2009. It is up 26.8% since then, annualizing at 43.1%.

GLD took it on the chin with today’s selloff of gold. That is a mere technical sell off. It remains a solid long-term hold position.

As stated for the last several months, gold remains fundamentally sound for long-term holding and a technical measure of authenticity in that assessment is in its bearish yellow curve. If it crosses below bearish yellow, you will not want to be holding.  The Quick-term Indicant will highlight that potential when this occurs.

ETF#14-TLT-Long Government  received a sell signal today from both the Near-term and Quick-term Indicant. Its Force Vector fell into bearish domains and its price fell below QTI Yellow and NTI Green. That is bearish; very bearish for TLT.

Major ETF Events

Dec 04, 2009-Fri-After fighting gallantly since last August, TLT succumbed today to bearish influences. Its bearish expression and underlying configuration should facilitate overall stock market bullishness in the next few days.

Dec 03, 2009-Thu-Today’s mild bearishness did nothing to upset the Short-term bullish bias.

Dec 02, 2009-Wed – Some Vector Pressures started moving bullishly today following several days of decline. That enhances the position of non-bearishness.

Dec 01, 2009-Tue – VIX Force Vector crossed above Vector Pressure on today’s stock market bullish aggression. If this inspires the VIX bull, the stock market should cool. If not, the VIX threat will perish and the stock market bull should gain momentum.

Nov 30, 2009-Mon – There were no major events.

Current Strategy-Short-term Indicant-Dec 4, 2009-Fri-Attributes are again shifting in favor of the bull on a Near-term basis. Dec 3, 2009-Thu-Same as last Monday. Dec 2, 2009-Wed-Same as last Monday. Nov 30, 2009-Mon-Attributes remain non-bearish. Unfortunately, many attributes are not bullishly supportive. 

Click Quick-term Indicant, Near-term, and Short-term for all 31-ETF’s.

Other links:

Short-term Indicant for DJIA and NASDAQ

Short-term Indicant Tables for the Dow Jones Industrial Average Index

Short-term Indicant Table for the NASDAQ Composite Index

Indicant Volume Indicator

Near-term, Quick-term, and Short-term Indicant for Major Indices

Divergence versus Convergence

Last week enjoyed mild bullish convergence. The bull is strengthening.

Indicant Conclusion

As stated the past eight weeks, low interest rates offer narrowed alternative investment opportunities. The argument holds that sideline cash is not smart. As long as this perception prevails, the bull cycle should continue.

Configurations remain supportive of the current Short-term bull.

Keep up with the daily stock market report as the Qui