January 2011 Weekly Stock Market Reports

Jan 30, 2011 Indicant Weekly Stock Market Report

Volume 01, Issue 05 ISSN 1526 6516 © The Indicant Stock Market Report

Optimization, Sub-optimization, and Degeneration

All physical objects that exist require the collection and assembly of a combination of some of the chemical elements. Upon the completion of that existence, one could argue its form, fit, and function enjoy an optimal conclusion to its designed intention, provided it thrives or just merely enjoys a continuation of existence. If it does not thrive or endures deteriorated conditions during existence, sub-optimization occurs, as it struggles for survival. The struggle during sub-optimization, though, can lead to optimization. On the contrary, when the struggling effort fails, extinction demonstrates the results of degeneration.

Optimization, sub-optimization, and degeneration are formal mathematical terms in operations research. The idea for optimization is to maximize some output, while minimizing the inputs. Inputs are constraints. Constraints are variables, expressed, mathematically as inequalities since desired changes in the objective function (output) will usually produce adjustments to the required inputs.

Most physical objects, however, are sub-optimal. One can argue that all physical things endure a half-life and then begin degeneration on its path to expiration or extinction. All physical objects are not ever lasting. However, those among the plants and animals have fostered a unique biological system of regeneration to replenish their ancestral expirations. That defers extinction in any group of biological objects. Extinction appears unavoidable, as 99% of all species that have existed eventually became extinct.

Few cells, which are a collection of the chemical elements, remain in a state of rest. They are either expanding or they are atrophying. Human cells discontinue expansion until the age of twenty or so in humans. Some can delay atrophic conditions from genetic luck or exercise.

Biological optimization is achieved for a few short years in humans around the age of twenty to twenty-five or so. Before and after that, though, the human body begins sub-optimization processes. Degeneration begins in later life in all living organisms. Expiration follows degeneration.

The U.S. Constitution stipulates all men are created equal. That is a relatively easy observation since all humans are helpless at birth. However, after birth inequalities manifest. Those inequalities are natural. Some of those on the short end of equality strive to gain competitive advantages over those who lack ambition. That “struggle” lifts those finding success to the superior group. Capitalism has shown that also brings the less ambitious upward, as well. Pareto principles clearly demonstrate this by the sheer volume of people contained in the middle class. This middle class is the majority, adding pizzazz to Pareto’s principles. The middle class is a clear target of politician by virtue of the “most votes” in a democracy; both real and fake.

Communism, unionism, and any other form of collectivism inspire the concept that equality among peers should manifest throughout ones life. That concept has demonstrated an acceleration of degenerate socio-economic solutions. Such socio-economic systems always collapse, as the collective members fall in ability equal to the lowest level members in the collection. Unfortunately, collective units have an easily identifiable target for politicians for a large ready-made block of votes. That is whom politicians cater. The lower end of any collective unit and/or democratic majority tend to devolve to political groupies. They are the ones you see attending political rallies.

All politicians, regardless of the socio-economic systems employed must cater to the masses. Pareto principles hold that a minority among the masses are the most productive while the majority, more or less, tag along. Many among that majority become envious. That envy is clear today with constant attacks on the top 2% wage earners. If it is true, that all people are created equal, then all should pay the same amount in taxes. For example, all Americans should pay $10,000 in taxes, regardless of income, possessions, or inheritance. That would indeed be a burden to the 44% of Americans, who pay no income tax. However, the penalty for not paying the $10,000 would not be severe. All that should happen is losing one’s right to vote. That would significantly enhance the quality of people who run for political office. Those 44% of free-loaders would no longer be targeted for votes.

Those who are envious tend to vote for those who claim they can make provisions to them to minimize stressful lives. The weak believe it is optimal to acquire with minimal effort. On the contrary, that accelerates cellular atrophy. Degeneration of the socio-economic systems then follows, as the majority believing that swells in numbers (and votes).

The traveling salesman problem originated in the 1800’s. However, optimization of which cities the traveling salesman should visit in a specific sequence could not be solved when the number of cities was a large number. The optimum solutions were not solvable until the invention of computers. The model used was referred to as the Simplex Method, which was an iterative process of finding any solution on the first iteration and processing thousands of iterations with each improving the result of the prior solution. Optimization would reveal the proper sequence of cities to visit that maximized revenue and minimized cost and other constraining variables.

Since then Narendra Karmarkar of ITT developed a more efficient model in 1986, commonly referred to as Interior Point Methods (or Barrier Methods). His model solves linear programs and nonlinear convex optimization problems. Applications improved profitability in the transportation industry, facilitated traffic improvements across phone lines, and eventually paved the way for the Internet.

Optimization requires an objective function. For example, the objective function is for the salesman to maximum sales during his travels. One never knows if optimal conclusions manifest until all the constraints are identified. For example, the revenues generated in one city may be higher than another city. However, the cost to travel to the other city may be significantly higher than traveling to the first city. When 38-cities with differing cost variables and potential revenues are included in the optimization problem, the time to calculate would take over 1500-years with IBM’s best mainframe computers in the 1970’s. Today, however, most processes can provide optimal answers in one night after about 8-hours of processing. Karmarkar’s theorems helped speed up the process to optimal conclusions more than the technology employed to process them.

Planned optimization of entire economies is not possible even in the smallest of countries. Computer processors are reaching their limits. So, one could argue that every transaction in any economy cannot ever be processed to compute optimization modeling for that economy. In other words, there are too many variables, inequalities, and constraints to compute.

All human beings, including politicians, are encumbered with brains that approximate three to three and a half pounds. Not all-potential knowledge can be captured into such a small organ. Not all-potential knowledge can be captured in one computer program including Karmarkar’s theorem. However, political leaders, with their limited knowledge, tend to think they have a more complete knowledge than their constituents do. After all, they are the leaders of their constituents and they reason they must be smarter and superior in many ways.

If the largest computers in the world struggle with computing optimization modeling for the relatively simple traveling salesman problem, how is it that political leadership thinks they manage the economy? They do not, but they think they can. Egypt’s Prime Minister, Hosni Mubarak, is learning firsthand about his limitations and the destructive conclusions in his attempt to “manage everything.” His little bitty three-pound brain was never large enough to manage too much more than ordering his breakfast, tending to his personal hygiene needs, and living his life of luxury. Because of his 30-years at the helm of Egypt, economic chaos manifested. He will be lucky to live out the week if he attempts to hold on that power. His little bitty three-pound brain may align chemical flows in that area of his brain that suggests, “flight” over “fight.” That may not, however, stoke the flames of the stock market bull.

In the former Soviet Union, those few select souls at the top of that structure never optimized. Although the hundred or so folks in charge of the Soviet Union enjoyed an accumulation of brain weight exceeding 300-pounds, most were consumed with “what’s in it for me.” That distracted from optimizing their economy, leading to sub-optimization and eventually to degeneration and extinction. They accelerated degeneration and to the point where the average life expectancy of a Russian male is twenty-years shy of the rest of the industrialized world. As of 1999, it had fallen to 58-years of age. Their cells degenerated over the three generations of communist rule, leading to excessive stress on their biological systems once the economy demanded more of a competitive element to their being. That is the fault of their ancestors and there is no humanistic solution to arrest that pitiful result. The only solution is to relearn struggle.

Some non-industrialized cultures enjoy much longer and healthier life spans. That is because every day is full of stress. If they fail at hunting or fishing, they will starve. Sub-optimization and cellular atrophying are delayed, considerably, in such cultures because of that stress. They do not have elections and promote the idea that the best orator among them is somehow superior. They do not understand provisions by others. After all, it does not make much sense for someone to kill the animal and then feed everyone else with it. If that happened the best hunters would die, which would eventually lead to the extinction of the entire culture.

The capital markets know that political attempts to equalize inequalities results in immediate sub-optimizations. Following that, degenerative processes manifests. The stock market bear is typically aroused after presidential state of the union speeches. That is why February is the most non-bullish month in the six-month bullish cycle (Nov-May).

You saw the bear’s arousal last week with Egypt’s follies and within a couple of weeks of the president state of the union. Bearish responses are not because of the president’s message. The capital markets know that politicians are irrelevant to capitalistic conquests. However, the capital markets do know that politicians are always potentially destructive to economic well being. When the popularity of politicians rises, which is occurring now, the capital markets become uncomfortable. When the masses “believe” in political leadership, sub-optimizations will manifest. That eats into corporate profits.

If political leadership holds their popularity very high for long periods, degenerative solutions eventually lead to a cultural collapse. That is always bearish and very much so ahead of the collapse itself. Politicians should never be feared. However, the masses that support them are to be feared. That, in part, is what is arousing the stock market bear. The potential cultural collapse in Egypt also has an arousing effect on the stock market bear.

The bull wants to see more biological cellular tension; not less. It wants to believe that cellular expansion is occurring, as opposed to atrophic behavior. This tension must begin in the political arena. U.S. federal debt must shrink. Debt shrinkage correlates well with a do-nothing government and that is always bullish. Expanding the federal government is always bearish, as demonstrated by FDR in the 1930’s. Debt shrinkage will tend to remove elements contributing to sub-optimization and fears of degeneration will subside. Debt shrinkage will manifest cellular expansion and slow atrophy. That would be bullish.

Mid-east unrest is always desired by the petroleum industry. Threatened supply lines are good for business. Capitalists would solve the problem of rising energy costs. The energy sector’s bullishness last week and in the past few months demonstrates this phenomenon. Unfortunately, politicians, dictators, kingdoms, and religious fanatics interject and sub-optimize solutions. They, like most, first figure out the answer to the most pressing question in any crisis, “how can I benefit?” It is always that and only that. That eventually leads to degenerate solutions. That is bearish.

Optimization occurs when two parties agree on a price. It is that simple. That is capitalism. Expanding that concept without political interferences would be bullish. Of course, political forces will never allow that simplicity until all people pay the same amount in taxes. That is also an optimal conclusion since the constraints are all equalities. That would be bullish, but do not hold your breath in anticipation thereof.

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 three sell signals. Those three sell signals were due to sudden and deep price declines this past Friday. Your stop losses should have minimized the damage.

The Mid-term Indicant is signaling hold for 292 of the 340-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 45.2%. That annualizes to 45.4%. The Mid-term Indicant has been signaling hold for these 292-stocks and funds for an average of 51.8-weeks.

The Mid-term Indicant is avoiding 42-stocks and funds of 340-tracked by the Indicant. The avoided stocks and funds are down an average of 50.7% since the Mid-term Indicant signaled sell an average of 120.0-weeks ago.

One year ago, on Jan 29, 2010, the Mid-term Indicant was holding 223-stocks and funds out of 333 tracked for an average of 33.6-weeks. They were up by an average of 22.4% (annualized at 34.7%). There were 91-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 45.8% since their respective sell signals an average of 99.8-weeks earlier one year ago. There were no buy signals but there were three sell signals on this weekend last year.

The Mid-term Indicant was signaling hold for only 19-stocks and funds of the 344-tracked two years ago on Jan 30, 2009. They were up by an average of 134.9% (annualized at 69.3%) since their respective buy signals an average of 101.3-weeks earlier. The Mid-term Indicant was avoiding 320-stocks and funds at that time. They were down an average of 35.3% since their respective sell signals an average of 35.6-weeks earlier. There were no buy signals and five sell signals on this weekend in 2009. The stock market bear continued dominating on this weekend in 2009.

There were 149-stocks and funds with hold signals on Jan 25, 2008 since their buy signals an average of 156.0-weeks earlier. They were up by an average of 173.9% (annualized at 58.0%). There were 192-avoided stocks and funds at that time. They were down by an average of 13.5% from their respective sell signals an average of 13.5-weeks earlier. There were six sell signals on this weekend in 2008 in addition to the 190-sell signals in the prior eleven weeks, as the bear market was already well underway at this point in 2008. Although performance levels remained excellent, many stocks and funds were beginning to display souring configurations.

On Jan 26, 2007, the Mid-term Indicant was signaling hold for 307-stocks and funds out of 345-tracked. They were up by an average of 107.2% (annualized at 60.5%) since their buy signals an average of 92.2-weeks earlier. The Mid-term Indicant was avoiding 31-stocks and funds at that time. They were down by an average of 12.8% since their sell signals an average of 21.3-weeks earlier. There was one buy signal and six sell signals on this weekend in 2007.

Five years ago, on Jan 27, 2006, there were 280-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 118.7% (annualized at 66.9%) since their respective buy signals an average of 92.3-weeks earlier. There were 58-avoided stocks and funds then. They were down an average of 8.7% since their respective sell signals an average of 19.3-weeks earlier. There were five buy signals and two sell signals on this weekend in 2006.

On Jan 28, 2005, there were 230-stocks and funds with hold signals from the listing of 320-tracked by the Mid-term Indicant at that time. They were up an average of 90.0%, annualizing at 64.5%, since their respective buy signals an average of 72.6-weeks earlier. There were 90-avoided stocks and funds then. They were down by an average of 26.8% since their sell signals an average of 49.1-weeks earlier. There were no buy signals and six sell signals on this weekend in 2005.

There were 282-stocks and funds with hold signals on Jan 30, 2004. They were up by an average of 67.1%, annualizing at 88.0%, since their buy signals 39.7-weeks earlier. The eight avoided stocks and funds were down an average of 27.9% since their respective sell signals an average of 42.4-weeks earlier. There were no buy or sell signals on this weekend in 2004.

On Jan 31, 2003, there were 137-stocks and funds with a hold signal, enjoying a 26.5% gain since their respective buy signals an average of 22.2-weeks earlier. That annualized at 62.2%. There were 95-avoided stocks at that time. They were down by an average of 6.8% since their sell signals an average of 5.3-weeks earlier. The Mid-term Indicant was tracking 296 stocks and funds in 2002-late 2004. There were seven buy signals on this weekend in 2003. However, the stock market began an early dip that year ahead of the nice 2003 bull leg, incurring 57-sell signals in addition to the 95-sell signals in the prior week in 2003.

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. Governmental and political behavior can have immediate and long-lasting unfavorable influences on the capital markets.

Some companies will perform well, regardless of the depth of stock market bears. 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.

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

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

The Mid-term and Short-term Indicant continue with support for the bull. The mid-term election year gained traction toward stock market bullishness. Much of this gain correlated with political dynamics. The stock market remains configured for classical stock market bullishness during pre-election years, which should be enjoyed in 2011, albeit with potential near-term bearish expressions. Keep in mind configurations do not yet support such bearishness. That prognosis rests on political dynamics and historical standards

The current stock market bull originated in anticipation of stalemated politicians. That has been the historical standard. Partisanship is expected to heighten and that remains in effect and therefore bullish in spite of potential for near-term bearish behavior. Mid-eastern unrest is threatening the economy by virtue of high-energy prices.

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% for holds with less than a 20% unrealized gain. Of course, this includes new buys. Stop losses shortly after buying are the trickiest, but they should be tight. Right after buying, set the stop loss at the lesser value of 8% or green curve values.

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. Do not worry if you stop out. New opportunities always emerge. The idea is to minimize losses.

Floor traders are aware of stop loss positions. If prices near those stop losses against the grain of directional bias, the floor traders will drive the price down to those stop losses and then buy for themselves and then quickly sell for profits at your expense. Although seemingly immoral, it is the nature of free markets and contributes to the desired liquidity of stock markets. This is one reason why stop losses should be well below prevailing prices but well above your buy price. That perfection, of course, is not attainable shortly after buying, which is the most dangerous period for holding. Use the Blue and Green curves or a combination thereof for stop loss management shortly after buying.

Long after a successful buy, monitor prices relative to the bearish yellow curve. That will minimize the number of trades, while protecting portfolio values.

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. If the green curve is rising and above your buy price, set the stop loss just below it. Green is a common bouncing point. Consider a stop loss a percentage below its value. Once green passes above your buy price, then adjust your stop losses, periodically, say weekly, at or just below green. Once yellow passes above your buy price, you should set the stop loss at the yellow price. That is a good tactic when longer-term holding positions are supported with expected fundamentals and your enjoyment of owning a piece of a great company or fund.

If your stop loss triggered sell, while Indicant continues signaling hold, normal advice would be to buy again. However, if the Near-term Indicant is signaling bear/avoid in related sectors, it is better to wait for specific buy signals from the Mid-term Indicant. In other words, other opportunities will emerge.

The ETF’s are signaled on the Near-term, Quick-term, and Short-term Indicant and are updated daily. These shorter-term models attempt participation in significant 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 62.3% since its secular weekly low on October 9, 2002. The NASDAQ is up 141.2% and the S&P500 is up 64.3% since then. The small cap index, S&P600, is up 142.1% 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. That will again be an attribute to monitor in coming months if the stock market moves bearishly by significant amounts. Such bearishness is unlikely based on current configurations. Historical standards and political climate support continued bullishness during 2011. Much of that depends, however, on the middle eastern uprising.

The NASDAQ is down 46.8% since its last weekly secular peak on March 9, 2000. The S&P500 is down 16.4% since its similar secular peak on March 23, 2000. The Dow is up by 0.9% 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.

If socialism continues to expand, the NASDAQ may not hit its 2000 peak until after 2050. Significant downsizing of federal governments and related regulations shrinkage will stimulate a reassessment of the previous sentence. If the opposite occurs with increasing federal bureaucracies, the NASDAQ will never return to its 2000 peak.

The NASDAQ year-to-date performance was bullish by 12.6% through this week in 2001. The NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness. January’s bullishness was a head-fake, as most of the bearishness manifested post 911 of that year.

The NASDAQ was down by 0.3% 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 NASDAQ stock market bear cycle found bottom in October 2002, which was consistent with the mid-term year’s historical standards of finding bottoms during mid-term election years.

The NASDAQ YTD 2003 performance was up by 0.5%. It finished up by 50.0% in 2003, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 3.7% and finishing up for that year by 1.4%. This was congruent with election year bullishness, although shy of magnitude standards.

It was down 6.4% on this weekend in 2005’s post election year, which was consistent with historical standards of losses and/or minimal gains during post election years. This was an excellent year, based on post election year historical standards of bearishness. Many of you recall that 2004 and 2005 were meandering bear markets.

In 2006, the NASDAQ was up 4.5% on this weekend. It finished up in 2006 by 9.5%, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 0.8% at this time in 2007, finishing up by 9.8%, which was consistent with pre-election year bullishness. The stock market peaked in 2007 from the 2003 bull leg after democrats took control of Congress in early 2007. George W. went along with them as opposed to repelling them. That accelerated the bear and added depth to its decline.

The NASDAQ was down by 11.4% on this weekend in 2008. It finished 2008 down by 40.5%. That was extreme contrarian performance to the standards of historical election year bullishness. It was the most bearish presidential election year since related records from 1832. It was down 4.4% on this weekend in 2009. Keep in mind, this extraordinary bullish cycle in 2009 finished that year down by 20.6% from its prior Mid-term cyclical peak on October 31, 2007. Historians will view that extraordinary bullishness as a mere spurt (reverberation) from 2008’s severe bear market. The 2008 bear market more accurately reflected economic fundamentals than the 2009 bull market. Much of the 2009 bull market correlated well with declining political popularity.

The NASDAQ was down 4.0% on this weekend last year. It finished 2010 up by 16.9%, which was consistent with mid-term election year bullishness; especially in the second half of such years.

The Dow is down 16.5% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 6.0% since its last peak on Oct 31, 2007. The S&P500 is down 18.5% since its Oct 9, 2007 peak. The S&P600-small cap index is down 7.1% 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.

Interestingly, the NAS100 topped its pre-crash highs of 2007/8. It continues maintaining that lofty achievement. It is the only major index with that position. It is up by 1.4% since its Oct 31, 2007 peak. The S&P400 eclipsed the 2007/8-precrash high on weekending January 14, 2010. It was up 0.4% last week and now down 0.9% from its prior peak on July 13, 2007. Interestingly, the S&P400 did not find comfort surpassing prior peaks from 2007. The Nov 14, 2010’s weekly report discussed this phenomenon.

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 last weekly cyclical bottom on November 20, 2008.

Although exact simultaneous bottoming did not occur on March 9, 2009, tracking from that pivot-point has been and will continue to be appropriate. This inexactness lends credence to the reverse tangential projections with a short-term view, albeit mildly so. Consequently, March 9, 2009 is the pivot date to monitor performance since the March 2009 bottoming from the 2007-2008 bear cycle.

The Dow is up 80.6% since March 9, 2009, which is the “bottoming” pivot date from the great bear market of 2007/8. The NASDAQ is up 111.8% and the S&P500 is up 88.7% since then. The S&P600, Small Cap Index, is up 127.4% since March 9, 2009. That March 2009-January 2010 bull leg was indeed powerful, but such cycles have occurred many times in the past only to be followed by bear cycles of varying breadth and depth. The Mid-term Indicant and Short-term Indicant are no longer suggesting impending bearishness. The Mid-term Indicant is suggesting potential meandering behavior, but not yet strongly so. The Near-term Indicant is configuring with potential bearish behavior by the S&P600 Index.

The current bull cycle is believed to be the classical mid-term election year bullish starting point ahead of the presidential pre-election year, which is now underway. The pre-election year is the most bullish along the 4-year cycle. In essence, the firing of incumbent politicians in the U.S. generally arouses the bull. The Near-term Indicant is not supportive right now for the S&P600 Index.

Political behavior is favoring the stock market bull with pressure to reduce government waste. Anticipating that is bullish, even though the shorter near-term cycle is not as supportive of the bull. Middle-eastern unrest, although, is a bit threatening to the stock market bull.

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.

As promised by Bernanke over a year ago, the discount rate (and prime) rate are holding flat from their depressed levels. The fed funds closing rate and call money also continue flat and very depressed. The 2012 forecast suggests values closer to zero than any other value.

The 3-month T-Bill remains flat and depressed, along with short-term CD’s. The 2012 forecasted values do not yet indicate any significant increases. Keep in mind these forecasts are purely statistical, but qualitative inquiries are not suggesting different projections at this time. However, the 6-month CD yield increased significantly seven weeks ago, suggesting desired longer-term upward pressures. Even with this new development, it remains depressed. Anyone buying a 6-month CD at 0.41% with 2+% CPI is heading to the poor house unless deflationary pressures manifest. At any rate, all CD’s remain as Yellow Bears.

The Euro jumped to Red Bull status this past week, but remains with weakening trend and weakening mid-term cycle. There is no good reason to assume its long-term cyclical decline will reverse. The Canadian dollar, like the Yen, has been stable the past several weeks, but with a mild strengthening bias. Its cyclical direction and trend remain bullish. The CA$ tends to parallel oil prices, but the forecast for the CA$ continues with projected strengthening. The Japanese Yen trend and mid-term cycle continues with strengthening trend, but has been trading in a shallow zone the past several weeks.

Overall, the US dollar threatens to continue strengthening, but continues to weaken against the Japanese Yen (high productivity) and the Canadian dollar (resource rich).

Gold’s optimistic forecast remains at $1600/oz by 2012. As you can see, it is tracking above its high-end forecasted value and it remains a Red Bull to boot in spite of near-term cyclical bearishness. The prior $2,000/oz-forecast by 2014 is now being challenged based on political dynamics. However, statistical bullishness remains in tact. At the same webpage, you will notice oil is less stable.

As stated by the Indicant for several months, it is priced where the Kingdom finds comfort at around $80/bbl. It has been nudging a bit higher than that for the past several weeks. The high end forecast, though, projects $120/bbl by 2012. The Saudi Kingdom will have to approve that, though. Reports suggest the kingdom is now comfortable at $100/bbl. It has been vacillating around $90/bbl the past several weeks with some speculative bullishness and solid economic reasons for that bullishness.

Commodity price’s quick-term cycle continues increasing. Significant bullish behavior continues. They are not yet contributory to inflationary pressures. The Dow Jones AIG Commodity Index and Spot Prices are enjoying Red Bull status. This remains economically bullish.

Scrolling down a bit on the aforementioned webpage, you will find the Reuter’s UK Commodities Index continues moving north since early 2009. It is a Red Bull. It continues to skyrocket, setting a new all time high during the week of November 8, 2010 and continues to set new highs. It remains economically bullish with inflationary considerations later. The CRB Bridge Futures continues its shift from waffling to more bullish aggression. It is also a solid Red Bull.

Commodities, overall, discontinued behavior consistent with uncertainty in favor of outright bullishness. “Extract baby extract” seems to be an evolving theme as more people around the planet are moving toward capitalistic progressions in spite of American waffling.

Mortgage rates were a bit bearish the past few days, aligning with its cyclical and longer-term trend. They did not find comfort at their first Red Curve interaction since late 2008 this past week.

The consumer price index and producer price index continue to be relatively stable.

Overall, hard economic data is stabilizing, albeit with increasing commodity prices. That is non-bearish, but lending support to longer-term inflationary potential. However, rising productivity from increased interests in capitalism around the world could significantly dampen inflationary threats. That, coupled with U.S. political dynamics of potential massive sovereign debt reductions, suggests dynamic bullishness.

At some point, the U.S. Congress will learn they have no influence on how China and India manage their economies; both of which will enjoy larger economies than the U.S. at some point. If they retain a penchant for capitalism, rest assured prices for all commodities will escalate. However, the rising productivity associated with capitalists could dampen the effects on consumers. These potential economic shifts are unparalleled in the annals of history.

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 again signaled buy on Sep 17, 2010. It is up 5.0%, annualizing at 13.5% since then. It was significantly bearish the past two weeks. Gold could be in trouble.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 13.3% since then, annualizing at 9.4%. This lazy fund has been solidly bearish in three of the past four weeks. It was mildly bullish last week.

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. The Mid-term Indicant signaled buy on Sep 17, 2010 following a couple of buy/sell cycles since late 2008. It is up 22.0%, annualized at 59.6% since the more recent buy signal.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003 until the next sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 17, 2010, following a couple of buy/sell cycles since late 2008. It is up 39.2%, annualized at 106.0%, since its Sep 17, 2010 buy signal. This was solidly bullish last week on middle-eastern unrest.

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 was down 18.4% since that sell signal and the buy signal on January 8, 2010. The Mid-term Indicant signaled buy on Oct 8, 2010. It is up 23.6% since then, annualizing at 75.7%.

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. After a few disappointing buy/sell cycles since late 2008, the Mid-term Indicant again signaled, buy, on Sep 17, 2010. It is up 35.0% since that buy signal, annualizing at 94.8%.

The Quick-term and Near-term Indicant signaled, buy, for ETF#03 – Energy and Natural Resources on Sep 15, 2010. It is up 31.3% since then, annualizing at 83.4%. It was up 242.4% (annualized at 44.8%) since the 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 61.5% since that buy signal, annualizing at 28.5%. 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 27.1%. The Near-term Indicant signaled buy on April 24, 2009 and it gained 17.3% until its sell signal on Feb 4, 2010. It received a sell signal from the Near-term Indicant on Jul 27, 2010, but received a new buy signal on Aug 9, 2010. It is was up by 12.0% since that buy signal, annualizing at 28.0% at the time of the Near-term sell signal last week on Jan 20, 2011. It is down 0.7% since that sell signal. The near-term model lost an opportunity of about 2% between Jul 27 and Aug 9, 2010.

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

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

All the major indices are up by an average of 23.3% since their bull signals an average of 42.6-weeks ago. That annualizes at 28.5%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $31,009,275. That beats buy and hold performance of $1,798,829 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $150,838. That beats buy and hold’s $125,021 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $220,824. That beats buy and hold’s $93,165 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1623.9%, 20.7%, and 146.7%, 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. The stock market did not succumb to the bear during the post election year, 2009. There will be another bear cycle at some future point. Boasting will be more available at that time.

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.

Click here for the Mid-term Table of Mutual Funds.

The Mid-term Indicant signaled sell for MF#22-ProFunds Ultra Short on April 3, 2009. It is down 74.2% since then. It will receive a buy signal only if the Quick-term Indicant signals buy for QID, which occurred last August, but quickly endured “fluttering” behavior, followed by bearish aggression. A sell signal quickly ensued. That fluttering prevented the buy signal for MF#22.

Although this is classically a post-election-year hold, the Mid-term Indicant was unable to signal buy in 2009, as the stock market bear remained in hibernation for the most part. The Short-term Bull displayed attributes of a thoroughbred in 2009 and thus no opportunities were available to shorting the stock market since the April 3, 2009 sell signal. It is no longer getting close to a buy signal, as it appears to have succumbed to the stock market bull for the time being. It may not receive a buy signal until 2013, which is the next post election year.

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 308.5% (annualized at 16.0%) since the Long-term Indicant signaled bull 1,004-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, including relative performance 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.

Influencing parameters in the LTI include prior bull cycles. The great bull market in the 1990’s was powerful enough to offset the 2008-2009 recessionary bear market in this long-term modeling.

The 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 or Saturday afternoon.

Short-term Indicant Stock Market Report - Summary

Although there is no bearish unanimity among the Near-term attributes, some of the major indices are troubled. The Transports, NASDAQ, NASDAQ100, and S&P600 are enduring Force in bearish domains. That is always threatening to any short-term bull cycle. The other major indices remain with bullishly healthy near-term configurations, which remain capable counterattacking some of the developing bearish attributes.

The above paragraph is repeated from the past few days and it remains in affect in spite of Friday’s bearish aggression. So far, configurations remain consistent with bearish spurt behavior. Evidence of bearish sustainability remains absent.

ETF#21-EWZ-Brazil Near-term bullish blue curve collapsed this past Friday. This ETF has endured directionless behavior the past several weeks and remains with a pathetic configuration. It weakened further and received a Near-term sell signal this past Friday. This is the first non-contrarian ETF receiving a sell signal since last August. ETF#20-EEM-Emerging Markets also succumbed to bearish ambitions today. It fell below NTI Green. Its Vector Pressure remains in bullish domains. Consequently, it also received a bear signal this Friday.

ETF#11-GLD-Gold enjoyed a strong bullish response to last Thursday’s bearish aggression. However, it remains solidly bearish on the near-term cycle. There is more about GLD later in this report.

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

The Near-term Indicant signaled no new bulls and no new bears. Click this sentence to see table leading to the charts.

The Short-term Indicant is signaling bull for all eleven non-contrarian indices. These bulls are up 11.7% since the NTI signaled bull an average of 15.8-weeks ago. That annualizes to 38.5%. The lone bear is contrarian VIX. It is down 7.7% since its bear signal 19.1-weeks ago. The VIX enjoyed a dramatic increase today, but no bull signal.

The Quick-term Indicant signaled bear for contrarian VIX on Sep 16, 2010. It is down 7.7% since that bear signal.

The Quick-term Indicant is signaling bull for all eleven major non-contrarian indices. The eleven major indices are up by an average of 13.6% since the bull signal an average of 19.8-weeks ago, annualizing at 35.6%.

Short-term Market Summary

The majority of Force Vectors remain in bullish domains, supporting the bull. Most Force Vectors continue dipping to the south, which is annoying the short-term bull cycle. The Transport’s Force cycle reversed to bullish direction. The bull/bear battle within Transports, as mentioned yesterday, did not remain isolated to that sector. The bear nudged its ambition ahead of the bull across all major stock market sectors. Commodities were especially bullish today, though.

Eleven QTI Red Bulls mitigate stock market bearish sustainability. Only one non-contrarian NTI Blue bull adds bullish support, but ever so slightly. In spite of Friday’s bearish aggression, any bearish behavior should be viewed as a mere spurt.

As stated Jan 18-Tue, do not be surprised at some excitement here. You saw that late week before last and again this Friday with the VIX increase and the bearish stock market. The VIX Force cycle is now moving bearishly, but from within bullish domains. VIX mischievous behavior did not subside in spite of its declining Force.

Indicant Volume Indicators

This has been a low volume bull since inception in May 2009 with occasional volume surges in support of the bull. It appears content in remaining as such for the time being and it has become even more depressed since the New Year. As stated the past few days, the Indicant Volume Indicator is nearing holiday levels. Volume is nearing a cyclical bottom, which offers potential stock market interest.

Jan 28, 2011-Fri-Big board volume was aggressive on today’s bearish aggression. That supports bearish inclinations, but a few more similar trading days are required before the bear can dominate. The NASDAQ volume was up a bit off recent averages. In other words, it was not robustly supportive of the bear’s ambition.

Jan 27, 2011-Thu-Again low volume. Therefore, bullish bias prevails.

Jan 26, 2011-Wed-Low volume again…bullish bias prevails.

Jan 25, 2011-Tue-Volume remains non-descriptive.

Jan 24, 2011-Mon-Extremely low volume on bullish aggression is equally suspicious to that on bearish aggression. Regardless, though, volume behavior offers no justification to invoke bearish bias. Bullish bias prevails in spite of today’s very low volume on solid bullish behavior.

Jan 21, 2011-Fri-Flat volume on flat behavior is meaningless.

Short-term ETF Report Card, Status, and Charts

The Near-term Indicant generated no buy signals and 2 sell signals.

The Near-term Indicant is signaling hold for 26-ETF’s. They are up by an average of 14.8% since their buy signals an average of 19.1-weeks ago. This annualizes at 40.3%.

The NTI is avoiding four ETF’s. They are down by an average of 25.1% since their sell signals an average of 14.3-weeks ago. They are contrarians, QID, VXX, TLT, and GLD.

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 18.1% since their buy signals an average of 27.0-weeks ago. This annualizes at 34.8%.

The Quick-term Indicant is avoiding 3-ETF’s (QID, VXX, TLT). They are all contrarian ETF’s. They are down by an average of 41.5% since their sell signals an average of 41.2-weeks ago.

Short-term Summary: There are 25-Red Bulls (lost one on Fri), mitigating dynamic and sustainable bearish behavior. The six NTI Blue Bulls (lost a whopping 18-on Fri) add bullish, but significantly waning support. Bearish spurt potential continues pestering the bull. Most all non-contrarians Force Vectors are moving south. This is the pestering element, but as long as Pressure remains in bullish domains, the bear can only pester. All non-contrarian Vector Pressure elements are in bullish domains. All non-contrarians are above an increasing NTI Green curve and the NTI Green curve is above their respective buy prices. ETF#21-EWJ Near-term bullish blue curve collapsed last Thursday.

Contrarian Funds

ETF#03-Natural Resources. The Near-term and Quick-term Indicant signaled buy on Sep 15, 2010. It is up 31.3%, annualizing at 83.4%, since then. This ETF remains with Red Bull status, mitigating sustainable bearish threats. The “energy bear” cannot find sustainable forces with current bullish attributes. This remains solidly bullish in spite of the late week bear attacks these past two weeks. Even with those attacks, it remains as a NTI Blue Bull. Force fell below Pressure this past Tuesday, but not yet threatening to the hold signals.

ETF#11-Gold and Precious Metals is up 61.5% since the QTI signaled buy on December 11, 2008. Annualized growth is at 28.5%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $122.50 and still rising. Being patient here is important since your buy price approximates $80.65.

The Near-term Indicant signaled sell on Jan 20, 2011. It is down 0.7% since that sell signal with Friday’s bullish aggression.

It fell below NTI Green on Jan 20, 2011. Its Force Vector dipped deeper into bearish domains on the same day. Vector Pressure shifted into bearish domains, which adds bearish support in spite of Friday’s bullish aggression. Configurations do not justify continued holding along the Near-term Indicant cycle and thus the avoid signal. Keep in mind the Quick-term Indicant should be your model of choice if you bought in Dec 2008.

Click this sentence for additional charting and current forecasting of the actual price of gold.

As stated since late 2008, 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 advise of that potential when it occurs. Keep in mind, currencies can be manipulated for a period. However, currencies decoupled from production and related productivity will endure inflation regardless of political witch doctoring. Keep in mind, GLD tracks the price of gold in U.S. dollars. A strengthening dollar will have a depressing effect on the price of gold. Please read on, as this paragraph is now being challenged.

Interestingly, gold appears to be in trouble along the near-term cycle. In reference to the Indicant Weekly Report of January 16, 2011, political influences may be gold’s worst enemy, as it is approaching its prior peak from 1492. If political forces result in shifting sovereign debt loads to the south, currencies will strengthen, dampening the “emotional” value of gold. The Tea Party movement may invoke this shift, as that political pressure strongly supports dynamic cuts in Federal spending. Perceptions hold that will dampen inflationary threats and thus depress the price of Gold in U.S. dollars.

ETF#14-TLT-Long Government received a sell signal from Quick-term Indicant on Nov 15, 2010, as price fell below QTI-Yellow. It is down 1.7% since that sell signal. It is a Yellow Bear, which offers no bullish support.

The Near-term Indicant signaled sell on Oct 14, 2010. It is down 8.8% since then. As you can see, it is having difficulty garnishing more bearish behavior. On the contrary, it eclipsed its NTI Blue curve today and Force moved above Pressure. This is somewhat bullish, but needs more attribute support to trigger a buy signal.

The Near-term Indicant and Quick-term Indicant signaled sell for ETF#31-QID on Sep 13, 2010. It is down 30.7% since then. Without a reverse split, this ETF appears to be in search of single digit status. It closed at $10.52 last Thursday, but Friday’s stock market bearish aggression increased it to $11.05 and thus minimizing probabilities of it falling to single digit levels. All attributes are no longer solidly bearish. Force dipped into bearish domains today. Although encouraging to bearish ambition, the overall stock market is not yet supportive of QID’s bullish desires.

The Near-term Indicant signaled sell on Sep 2, 2010 for ETF#32-VXX. It is down 60.0% since then. Its Force Vector continues with an ever increasingly mature bullish cycle, threatening the stock market bull. However, that threat is minimal due to the VIX and VXX low pressure. Its Force Vector crossed above Vector Pressure last Friday, but that remains irrelevant.

Major ETF Events

Jan 28, 2011-Fri-The near-term lost 18-Blue Bulls today. The stock market is configuring with near-term “peaking.” There were also two Near-term Indicant sell signals on Friday for non-contrarian ETF’s; both international. However, this is offering minimal bearish support for the overall stock market at this time.

Jan 27, 2011-Thu-ETF#21-EWZ-Brazil-Near-term bullish blue curve collapsed today. This ETF remains with a pathetic configuration.

Jan 26, 2011-Wed-The VIX cowardly fell below the NTI Blue curve today. Its timidity is certainly not encouraging the stock market bear.

Jan 25, 2011-Tue-TLT Force eclipsed Pressure and its price moved above NTI Blue. This is a major assertion by the TLT bull, but needs just a bit more support to garnish a buy signal.

Jan 24, 2011-Mon-The Dow Transports fell below NTI Blue and Green today. Force is in bearish domains, but its cycle is mature. It needs to reverse quickly or the bear will find inspiration. The NASDAQ100 and S&P600 are similarly configured. However, the formerly weak Utilities sector is too strong to allow the stock market bear to unleash sustainable fury.

Current Strategy-Short-term Indicant- Jan 28, 2011-Holding remains safe, relative to NTI Green prices. Prices remain above Green, for the most part, and Green is well above the buy prices. Falling below Green with minimal Force will trigger the next sell signals. There were two such events last Friday for internationally related ETF’s. For those of you who bought GLD on Dec 2008 buy signal, wait for the price to fall below Yellow before selling, even though it is now enduring a Near-term avoid signal.

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. The stock market is now in the heart and soul of bullish seasonality. The bear will have difficulty manifesting with the shifting political cycles.

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 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.

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 stock market endured bearish divergence the past two weeks, following combined bullish convergence/divergence in six of the prior eight weeks. Middle-eastern unrest had Friday’s stock market behaving like the 1970’s stock market with energy up and everything else down. However, configurations continue suggesting any bearish behavior should be viewed as a mere spurt.

Indicant Conclusion

The presidential pre-election year stock market bullishness remains in tact as it has now entered into the strongly bullish pre-election year. Technical support is waning by the Near-term Indicant, but without bearish breadth. However, last Friday’s bearish aggression resulted in several Near-term Indicant Blue bulls expiring. In spite of that, though, there were only two Near-term Indicant sell signals and no Quick-term sell signals.

Meandering behavior may be confronting the stock market bull. The Indicant Volume Indicator remains depressed, as the post holiday sessions did not introduce significant increases in volume. Volume should increase in coming weeks and months, offering additional obviations of directional intensity.

As stated the past 69-weeks, low interest rates impose narrowed alternative investment opportunities. That narrowed alternative suggests more demand for common stocks. Worldly events may be adjusting in support of the original premise; that is, where else can one put their money to work? The stock market, of course! The stock market bull continues expressing support for this principle.

Political phenomena in the U.S., coupled with low interest rates, continue in support of the bull. Inflation has not yet threatened the bull. Keep in mind, though, it will at some point in the future unless Congress is successful in reducing 2.5-trillion dollars from the national debt.

Middle-eastern politics is a bit threatening to the bull at this time. Longer-term issues will become more pronounced during the post-bickering period. If Egyptians allow a dictator or religion fanaticism to rule them, there could be a prolonging bearish influence. Much of that will depend on the supply reliability of petro and the state of Israel. International war, though, would be a more likely outcome. The target will be most middle-eastern countries. Depending on damage and impact to the supply of petro, a bullish response would be likely. A philosopher of wrong will not adjust just because someone else tells them it is wrong. Chit-chat accomplishes nothing when engaging the irrational.

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

01/30/2011

Jan 23, 2011 Indicant Weekly Stock Market Report

Volume 01, Issue 04 ISSN 1526 6516 © The Indicant Stock Market Report

Why February Is Usually Non-Bullish

The majority rules democracies. The best socio-political systems are believed to have a democratic basis. After all, the majority should rule. History demonstrates the failure of several prior democracies. Apparently, the majority is not always right.

U.S. forefathers apparently understood history. They must have understood democracies prior failures. Upon completion of the U.S. Constitution, Ben Franklin advised “we have given you a republic….we hope you can keep it together,” indicating there will be some who will venture with its destruction from time to time.

The founders of the U.S. Constitution had real jobs. They knew how to make money in a capitalistic environment. They understood the inherent hard work and honest fortitude to do so. That contrasts, significantly, with today’s politicians. Most contemporary politicians never worked within the capitalistic system. Consequently, their thinking is inaccurate. Their actions lead to economic damage. They are in the business of “taking.” They do not understand how much sweat and labor they drain from honest hard working people around this world.

The Pareto principle helps in understanding a direct causative reason for the demise of democracies. An Italian economist, Alfredo Pareto, observed that 20% of the people owned 80% of the land in the late 1800’s. A variety of Pareto applications have been developed through many disciplines since Pareto’s initial observation, as it has consistently demonstrated its merit.

If the 80% non-land owners become envious, the 20% who own land will lose it in a democracy. The less productive will simply elect politicians who promise to take land and give it to them. That is the problem with pure democracies.

The idea of a republic is to prevent that inevitable result. In other words, there are three pillars of power; all equal in power, and designed, more or less, to prevent any single pillar from gaining absolute power. In essence, the founding fathers understood the dangers of a potential tyrannical majority. Adolph Hitler clearly demonstrates what happens when absolute power is coalesced into a small group of people.

The 80-20 rule suggests that 80% of the wealth is created by 20% of the people. Names, such as Dell, Gates, Edison, Ford, Sloan, Halliburton, etc. represent those highly productive 20%. The capital markets facilitate extraordinary wealth accumulations by those highly productive 20%. Politicians do not directly seek the votes of those 20%. After all, that is a solid minority and not friendly to the politically ambitious. Consequently, politicians seek votes from the less productive 80%. To get their votes, they have to directly and indirectly convey “giving” in return for votes. To give, they must first, take, because politicians do not have enough wealth to placate the 80% less productive. Therefore, they must work at acquiring assets from the highly productive 20%, where an abundance of assets can be transferred to the less productive.

The U.S. President typically enjoys popularity surges around the time of the annual state of the union address. This occurs in late January of each year. This rise in political popularity scares the capital markets. The stock market bear is typically aroused during this ceremonial event. Consequently, since 1950, February has been relatively flat. Although not the worse performing month of the twelve, it is the only month with disappointing stock market performance that is sandwiched between the Stock Trader’s Almanac discovery of the bullish half of the year; November through May.

After the state of the union address by the U.S. President, the stock market finds difficulty expressing bullish behavior. The capital markets fear new and evolving punishments to the productive 20% and tyranny by the not so productive 80%. This fear correlates with the president’s state of the union address and thus correlative to the normally depressing behavior in February. Some could argue the president’s state of the union address is causative to February’s disappointments to the stock market bull.

Fortunately, there have been enough votes among the 80% group that recognizes their quality of life directly correlates to the profound prosperity of the 20%-group. That typically elevates just enough votes, most of the time, to hold potential political tyrants at bay.

Political leadership constantly exacerbates potential tyranny by the majority. Politicians elected by the majority scare capital markets, since a near majority of the 80% tend to support those who campaign on “giving” them something. If political leadership becomes very popular, the stock markets find yet more difficulty expressing bullish behavior. Such increases in political popularity can lead to increases in taxes, regulation, and other wealth snuffing practices.

For example, politicians enjoy promulgating universal healthcare. Politicians recognize that many among the 80% are gullible. Therefore, political jibber-jabber is non-stop on what they can do for and “give” to the populace. Very few politicians are medical doctors, who are the only ones who could address biological elements confronting one’s health. The other 500 or so in Congress, Executive Offices, and the Supreme Court would have no idea on how to address health related concerns. Nevertheless, they keep on jibber jabbing about it.

The public sector has been “educating” children for about one hundred years or so. The educational system has apparently produced too few smart enough to become medical doctors, while producing huge numbers of unhealthy people and hypochondriacs. The same folks that have been in charge of the public school system that has produced severe imbalances between “capability” and “need” in the healthcare industry continue promulgating their “know it all” message on how to fix the problem of healthcare. Since those idiots remain in political power, there is one obvious truth; people are indeed gullible and/or tyranny by the majority may unfold.

The stock market recognized the tyranny threat by the majority might be delayed last August. It anticipated a high turnover rate in Congress last August. This anticipation propelled the stock market bull ahead of the mid-term elections, where many congressional incumbents were booted from office. The stock market bull rejoiced in its recognition that there are enough votes in the 80% group willing to vote to protect the wealth producing abilities in the 20% group.

However, since then, presidential political popularity has increased. Some of this increase relates to the impending state of the union speech. Some relates to other reasons. The reasons are typically irrelevant to the stock market bull. It simply does not like increasing popularity among politicians, who are distracting to wealth creation and the largest group that destroys it. The stock market bull’s confidence has waned with this increasing popularity by a left leaning president. The stock market bull may abandon its prior aggression because this increasing popularity elevates the threat of tyranny by the majority.

Do not be surprised at soft market conditions to increasing bearishness following the state of the union address. The S&P600 is configuring to bolster the stock market’s bearish ambition. Its Force Vector fell into bearish domains. Pressure is declining. It fell below the Near-term Indicant’s green curve last week. Its bullish blue curve has collapsed. However, it remains as a Quick-term Red Bull and therefore not a major concern at this time, but noticeable nonetheless. Also, the other major indices remain configured in support of the stock market bull, minimizing the potential bearish threat.

However, it would be appropriate to adjust one’s thinking to recognize potential bearishness on the immediate horizon. Magnitude is always unknown and bear/sell signals will be quick once configurations justify them. The bull market originating in late March 2009 was more or less manipulated by politicians and Federal bureaucracies, as opposed to real wealth creation. Rest assured all manipulations, in any form and by anyone, will be paid back, plus interest. That is one of those universal laws.

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 295 of the 340-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 44.9%. That annualizes to 46.2%. The Mid-term Indicant has been signaling hold for these 295-stocks and funds for an average of 50.5-weeks.

The Mid-term Indicant is avoiding 42-stocks and funds of 340-tracked by the Indicant. The avoided stocks and funds are down an average of 49.9% since the Mid-term Indicant signaled sell an average of 119.0-weeks ago.

One year ago, on Jan 22, 2010, the Mid-term Indicant was holding 226-stocks and funds out of 333 tracked for an average of 31.5-weeks. They were up by an average of 24.0% (annualized at 39.6%). There were 91-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 44.8% since their respective sell signals an average of 98.8-weeks earlier one year ago. There were no buy or sell signals on this weekend last year.

The Mid-term Indicant was signaling hold for only 23-stocks and funds of the 344-tracked two years ago on Jan 23, 2009. They were up by an average of 101.8% (annualized at 76.6%) since their respective buy signals an average of 69.1-weeks earlier. The Mid-term Indicant was avoiding 310-stocks and funds at that time. They were down an average of 36.5% since their respective sell signals an average of 35.5-weeks earlier. There was one buy signal and ten sell signals on this weekend in 2009.

There were 152-stocks and funds with hold signals on Jan 18, 2008 since their buy signals an average of 153.3-weeks earlier. They were up by an average of 167.2% (annualized at 56.7%). There were 152-avoided stocks and funds at that time. They were down by an average of 17.2% from their respective sell signals an average of 14.8-weeks earlier. There were 19-sell signals on this weekend in 2008 in addition to the 171-sell signals in the prior ten weeks, as the bear market was already well underway at this point in 2008. Although performance levels remained excellent, many stocks and funds were beginning to display souring configurations.

On Jan 19, 2007, the Mid-term Indicant was signaling hold for 313-stocks and funds out of 345-tracked. They were up by an average of 105.8% (annualized at 60.6%) since their buy signals an average of 90.9-weeks earlier. The Mid-term Indicant was avoiding 32-stocks and funds at that time. They were down by an average of 13.5% since their sell signals an average of 21.2-weeks earlier. There were no buy or sell signals on this weekend in 2007.

Five years ago, on Jan 20, 2006, there were 279-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 116.9% (annualized at 65.3%) since their respective buy signals an average of 93.1-weeks earlier. There were 52-avoided stocks and funds then. They were down an average of 11.4% since their respective sell signals an average of 24.7-weeks earlier. There were two buy signals and eleven sell signals on this weekend in 2006.

On Jan 21, 2005, there were 230-stocks and funds with hold signals from the listing of 320-tracked by the Mid-term Indicant at that time. They were up an average of 88.6%, annualizing at 71.6%, since their respective buy signals an average of 48.7-weeks earlier. There were 85-avoided stocks and funds then. They were down by an average of 27.5% since their sell signals an average of 48.7-weeks earlier. There were no buy signals and five sell signals on this weekend in 2005.

There were 288-stocks and funds with hold signals on Jan 23, 2004. They were up by an average of 68.6%, annualizing at 92.9%, since their buy signals 38.4-weeks earlier. The eight avoided stocks and funds were down an average of 28.7% since their respective sell signals an average of 41.4-weeks earlier. There were no buy or sell signals on this weekend in 2004.

On Jan 24, 2003, there were 289-stocks and funds with a hold signal, enjoying a 22.0% gain since their respective buy signals an average of 18.7-weeks earlier. That annualized at 61.2%. There were only six avoided stocks at that time. They were down by an average of 24.0% since their sell signals an average of 16.6-weeks earlier. The Mid-term Indicant was tracking 296 stocks and funds in 2002-late 2004. There were no buy signals on this weekend in 2003. However, the stock market began an early dip that year, incurring 95-sell signals.

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.

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

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

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

Long after a successful buy, monitor prices relative to the bearish yellow curve. That will minimize the number of trades, while protecting portfolio values.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 62.9% since its secular weekly low on October 9, 2002. The NASDAQ is up 141.1% and the S&P500 is up 65.2% since then. The small cap index, S&P600, is up 140.4% 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. That will again be an attribute to monitor in coming months if the stock market moves bearishly by significant amounts. Such bearishness is unlikely based on current configurations. Historical standards and political climate support continued bullishness during 2011.

The NASDAQ is down 46.7% since its last weekly secular peak on March 9, 2000. The S&P500 is down 16.0% since its similar secular peak on March 23, 2000. The Dow is down by 1.3% 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.

The NASDAQ year-to-date performance was bullish by 12.1% through this week in 2001. The NASDAQ finished 2001 down by 21.1%, which was congruent with standards of post-election-year-bearishness.

The NASDAQ was down by 1.0% 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 NASDAQ stock market bear cycle found bottom in October 2002, which was consistent with the mid-term year’s historical standards of finding bottoms in mid-term election years.

The NASDAQ YTD 2003 performance was up by 2.2%. It finished up by 50.0% in 2003, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 6.9% and finishing up for that year by 1.4%. This was congruent with election year bullishness, although shy of magnitude standards.

It was down 6.5% on this weekend in 2005’s post election year, which was consistent with historical standards of losses and/or minimal gains. This was an excellent year, based on post election year historical standards of bearishness. Many of you recall that 2004 and 2005 were meandering bear markets.

In 2006, the NASDAQ was up 1.9% on this weekend. It finished up in 2006 by 9.5%, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 1.5% at this time in 2007, finishing up by 9.8%, which was consistent with pre-election year bullishness. The stock market peaked in 2007 from the 2003 bull leg after democrats took control of Congress in early 2007. George W. went along with them as opposed to repelling them. That accelerated the bear and added depth to its decline.

The NASDAQ was down by 11.8% on this weekend in 2008. It finished 2008 down by 40.5%. That was extreme contrarian performance to the standards of historical election year bullishness. It was the most bearish presidential election year since related records from 1832. It was down 4.4% on this weekend in 2009. Keep in mind, this extraordinary bullish cycle in 2009 finished that year down by 20.6% from its prior Mid-term cyclical peak on October 31, 2007. Historians will view that extraordinary bullishness as a mere spurt (reverberation) from 2008’s severe bear market. The 2008 bear market more accurately reflected economic fundamentals than the 2009 bull market. Much of the 2009 bull market correlated well with declining political popularity.

The NASDAQ was down 0.2% on this weekend last year. It finished 2010 up by 16.9%, which was consistent with mid-term election year bullishness; especially in the second half of such years.

The Dow is down 16.2% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 5.9% since its last peak on Oct 31, 2007. The S&P500 is down 18.0% since its Oct 9, 2007 peak. The S&P600-small cap index is down 7.8% 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.

Interestingly, the NAS100 topped its pre-crash highs of 2007/8. It is up by 1.3% since its Oct 31, 2007 peak. The S&P400 eclipsed the 2007/8-precrash high on weekending January 14, 2010. It was down 1.8% last week and now down 1.3% from its prior peak on July 13, 2007. Interestingly, the S&P400 did not find comfort surpassing prior peaks from 2007. The Nov 14, 2010’s weekly report discussed this phenomenon.

The Dow is up 81.3% since March 9, 2009, which is the “bottoming” pivot date from the great bear market of 2007/8. The NASDAQ is up 112.0% and the S&P500 is up 89.7% since then. The S&P600, Small Cap Index, is up 125.8% since March 9, 2009. That March 2009-January 2010 bull leg was indeed powerful, but such cycles have occurred many times in the past only to be followed by bear cycles of varying breadth and depth. The Mid-term Indicant and Short-term Indicant are no longer suggesting impending bearishness. The Mid-term Indicant is suggesting potential meandering behavior, but not yet strongly so. The Near-term Indicant is configuring with potential bearish behavior by the S&P600 Index.

The current bull cycle is believed to be the classical mid-term election year bullish starting point ahead of the presidential pre-election year, which is now underway. The pre-election year is the most bullish along the 4-year cycle. In essence, the firing of incumbent politicians in the U.S. always arouses the bull. The Near-term Indicant is not supportive right now for the S&P600 Index.

Political behavior is favoring the stock market bull with pressure to reduce government waste. Anticipating that is bullish, even though the shorter near-term cycle is not as supportive of the bull.

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.

As promised by Bernanke, the discount rate (and prime) rate are holding flat from their depressed levels. The fed funds closing rate and call money also continue flat and very depressed. The 2012 forecast suggests values closer to zero than any other value.

The 3-month T-Bill remains flat and depressed, along with short-term CD’s. The 2012 forecasted values do not yet indicate any significant increases. Keep in mind these forecasts are purely statistical, but qualitative inquiries are not suggesting different projections at this time. However, the 6-month CD yield increased significantly six weeks ago, suggesting desired longer-term upward pressures. Even with this new development, it remains depressed. Anyone buying a 6-month CD at 0.41% with 2+% CPI is heading to the poor house unless deflationary pressures manifest. At any rate, all CD’s remain as Yellow Bears.

The Euro remains neutral with weakening trend and weakening mid-term cycle. This behavior tracks more closely to its long-term cyclical decline. The Canadian dollar, like the Yen, has been stable the past several weeks. Its cyclical direction and trend remain bullish. The CA$ tends to parallel oil prices, but the forecast for the CA$ continues with projected strengthening. The Japanese Yen trend and mid-term cycle continues with strengthening trend. It was mildly bearish this past week.

Overall, the US dollar threatens to continue strengthening, but continues to weaken against the Japanese Yen (high productivity) and the Canadian dollar (resource rich).

Gold’s optimistic forecast remains at $1600/oz by 2012. As you can see, it is tracking above its high-end forecasted value and it remains a Red Bull to boot. The prior $2,000/oz-forecast by 2014 is now being challenged based on political dynamics. However, statistical bullishness remains in tact. At the same webpage, you will notice oil is less stable.

Scrolling down a bit on the aforementioned webpage, you will find the Reuter’s UK Commodities Index continues moving north since early 2009. It is a Red Bull. It continues to skyrocket, setting a new all time high during the week of November 8, 2010. It remains economically bullish with inflationary considerations later. The CRB Bridge Futures continues its shift from waffling to more bullish aggression. It is also a solid Red Bull.

Mortgage rates were a bit bearish the past few days, aligning with its cyclical and longer-term trend. They did not find comfort at their first Red Curve interaction since late 2008 this past week.

The consumer price index and producer price index continue to be relatively stable.

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 again signaled buy on Sep 17, 2010. It is up 7.2%, annualizing at 20.5% since then. It was significantly bearish last week.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 12.9% since then, annualizing at 9.2%. This lazy fund was solidly bearish the past three weeks.

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. The Mid-term Indicant signaled buy on Sep 17, 2010 following a couple of buy/sell cycles since late 2008. It is up 20.7%, annualized at 59.2% since the more recent buy signal.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003 until the next sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 17, 2010, following a couple of buy/sell cycles since late 2008. It is up 32.5%, annualized at 92.9%, since its Sep 17, 2010 buy signal. This was also bearish last week.

The Quick-term and Near-term Indicant signaled, buy, for ETF#03 – Energy and Natural Resources on Sep 15, 2010. It is up 29.4% since then, annualizing at 82.7%. It was up 242.4% (annualized at 44.8%) since the 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 62.5% since that buy signal, annualizing at 29.4%. 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 27.1%. The Near-term Indicant signaled buy on April 24, 2009 and it gained 17.3% until its sell signal on Feb 4, 2010. It received a sell signal from the Near-term Indicant on Jul 27, 2010, but received a new buy signal on Aug 9, 2010. It is was up by 12.0% since that buy signal, annualizing at 28.0% at the time of the Near-term sell signal last week on Jan 20, 2011. It is down 0.1% since that sell signal. The near-term model lost an opportunity of about 2% between Jul 27 and Aug 9, 2010.

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

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

All the major indices are up by an average of 23.7% since their bull signals an average of 41.6-weeks ago. That annualizes at 29.6%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $31,135,529. That beats buy and hold performance of $1,806,152 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $151,667. That beats buy and hold’s $125,708 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $230,067. That beats buy and hold’s $93,257 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1623.9%, 20.7%, and 146.7%, respectively, for these indices as of this past week.

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.

Click here for the Mid-term Table of Mutual Funds.

The Mid-term Indicant signaled sell for MF#22-ProFunds Ultra Short on April 3, 2009. It is down 74.0% since then. It will receive a buy signal only if the Quick-term Indicant signals buy for QID, which occurred last August, but quickly endured “fluttering” behavior, followed by bearish aggression. A sell signal quickly ensued. That fluttering prevented the buy signal for MF#22.

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 310.1% (annualized at 16.1%) since the Long-term Indicant signaled bull 1,003-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, including relative performance 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.

Influencing parameters in the LTI include prior bull cycles. The great bull market in the 1990’s was powerful enough to offset the 2008-2009 recessionary bear market in this long-term modeling.

The Short-term Indicant Stock Market Report

Short-term Indicant Stock Market Report - Summary

As stated the past several days, “all Short-term attributes support the stock market bull.” As stated last Tuesday, “the VIX is due for some added excitement. This could be a bit disruptive to the stock market bull while remaining absent of attributes that could inspire the bear.” As you saw, the VIX responded with a solid bullish bounce the last Wed, Thu, and Fri. As you can see, this bear is attempting to antagonize the bull. These annoyances occur more often than not and unavoidable. The bear will probably continue threatening, but meaningless until prices fall to NTI Green curves.

The S&P600 fell below NTI Green and its Force Vector dipped into bearish domains. Transports NTI Blue collapsed today. However, with all this, bearish unanimity remains absent. A bearish spurt could manifest, but without full support it should not manifest into a deep or sustainable bearish cycle.

GLD’s price fell below NTI Green last Thu. Force deepened its cycle into bearish domains. That combination triggered a Near-term Indicant sell signal. The Quick-term Indicant, however, is signaling hold and will continue to do so until price falls below QTI Yellow curve. Keep in mind, GLD is up 62.5% since the Dec 11, 2008 buy signal. That was over two years ago. Buy price was $80.65. Yellow price is currently at $122.15 and it will continue to rise even if GLD continues with a near-term bearish cycle. If you bought on the QTI buy price, continue to hold. However, if it falls below Yellow, you will not want to be holding. If Congress cuts two-trillion plus from the debt, rest assured gold will plummet. If political unison attacks wasteful government spending by more than token amounts and productivity rises as it did in the 1990’s, inflationary pressures will devolve. This is one area where political unanimity would be a good thing. That could put gold back to less than $300/oz and propel the Dow above 25,000. Keep in mind, this is not a forecast. It is mere speculation derived from a lone 3.5# brain; albeit a logical one. With that, it would undo quite a bit of prior bearish dialog contained herein. Politics is playing a much larger role in stock market behavior. The capital markets will constantly measure the level of voter stupidity (or brilliance). As you know, it can go either way.

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

The Near-term Indicant signaled no new bulls and no new bears. Click this sentence to see table leading to the charts.

The Short-term Indicant is signaling bull for all eleven non-contrarian indices. These bulls are up 12.1% since the NTI signaled bull an average of 14.8-weeks ago. That annualizes to 42.4%. The lone bear is contrarian VIX. It is down 15.0% since its bear signal 18.1-weeks ago.

The Quick-term Indicant signaled bear for contrarian VIX on Sep 16, 2010. It is down 15.0% since that bear signal.

The Quick-term Indicant is signaling bull for all eleven major non-contrarian indices. The eleven major indices are up by an average of 13.9% since the bull signal an average of 18.8-weeks ago, annualizing at 38.5%.

Short-term Market Summary

The majority of Force Vectors remain in bullish domains, supporting the bull. S&P600 Force continues dipping south. Force is now below Pressure and in bearish domains. It is also no longer a blue bull. Although the strongest index among the majors, it is usually the first to inspire the bear. However, until it contacts NTI Green, the Near-term bull must be honored.

Eleven QTI Red Bulls mitigate stock market bearish sustainability. Seven NTI Blue bulls add bullish support. Any bearish behavior should be viewed as a mere spurt. Such a spurt is threatening with Transports, NASDAQ, NAS100, S&P400, and the S&P600 Indices.

VIX Force is now increasing. It crossed above Pressure this past Thursday. As stated Jan 18-Tue, do not be surprised at some excitement here. You saw some the past three days with the VIX increase and the bearish stock market.

The bull is maintaining protective breadth, but the S&P600 has been mildly encouraging the bear. The Transports, NASDAQ, NAS100, and S&P400 have joined in that chorus.

Indicant Volume Indicators

This has been a low volume bull since inception in May 2009 with occasional volume surges in support of the bull. It appears content in remaining as such for the time being. Volume surges will eventually occur and with that obviations of directional intensity will be enhanced. Until then, there are no reasons to argue with the bull.

Jan 21, 2011-Fri-Flat volume on flat behavior is meaningless.

Jan 20, 2011-Thu-Volume is edging up on bearish behavior. Most relates to nervous day-traders of the wrong side of the cycle. Regardless, volume has offered no evidence of any shift in bias. Although a bearish spurt is underway, bullish bias remains.

Jan 19, 2011-Wed-Normal volume on some bearish behavior does not justify bias shift from bullish. The bearishness is not surprising and appears technical.

Jan 18, 2011-Tue-Volume again edged upward on mild bullish behavior, adding to strength of bullish bias.

Jan 14, 2011-Fri-Volume nudge up on mild bullish behavior on lackluster news. Bullish bias prevails.

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 14.6% since their buy signals an average of 18.4-weeks ago. This annualizes at 41.3%.

The NTI is avoiding four ETF’s. They are down by an average of 24.9% since their sell signals an average of 13.3-weeks ago. They are contrarians, QID, VXX, TLT, and GLD.

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 18.5% since their buy signals an average of 26.0-weeks ago. This annualizes at 37.0%.

The Quick-term Indicant is avoiding 3-ETF’s (QID, VXX, TLT). They are all contrarian ETF’s. They are down by an average of 41.5% since their sell signals an average of 40.2-weeks ago.

Short-term Summary: There are 26-Red Bulls (down one this past Friday), mitigating dynamic and sustainable bearish behavior. The 12-NTI Blue Bulls (down 15 the past three days) add bullish, but waning support. There is a bearish spurt antagonizing the bull. Force Vectors are no longer moving in favor of the bull but without bearish unanimity. They are directionally mixed, with the majority shifting in favor the bear.

Contrarian Funds

ETF#03-Natural Resources. The Near-term and Quick-term Indicant signaled buy on Sep 15, 2010. It is up 29.4%, annualizing at 82.7%, since then. This ETF remains with Red Bull status, mitigating sustainable bearish threats. The “energy bear” cannot find sustainable forces with current bullish attributes. This remains solidly bullish in spite of the bear attack last Wed and Thu. Even with that attack, it remains as a NTI Blue Bull.

ETF#11-Gold and Precious Metals is up 62.5% since the QTI signaled buy on December 11, 2008. Annualized growth is at 29.2%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $122.15 and still rising. Being patient here is important since your buy price approximates $80.65.

The Near-term Indicant signaled sell this past Thursday. It is down 01.% since that sell signal.

It fell below NTI Green last Thursday. Its Force Vector dipped deeper into bearish domains on the same day. Vector Pressure remains in bullish domains, but barely, while offering mild hope for an early rebound. Configurations do not justify continued holding along the Near-term Indicant cycle and thus the sell signal this past Thursday. Keep in mind the Quick-term Indicant should be your model of choice if you bought in Dec 2008.

Click this sentence for additional charting and current forecasting of the actual price of gold.

Interestingly, gold appears to be in trouble along the near-term cycle. In reference to last weekend’s weekly report, political influences may be gold’s worst enemy. If political forces result in shifting sovereign debt loads to the south, currencies will strengthen, dampening the “emotional” value of gold. The Tea Party movement may invoke this shift. Keep in mind gold is nearing its all time peak, which occurred in the year 1492.

ETF#14-TLT-Long Government received a sell signal from Quick-term Indicant on Nov 15, 2010, as price fell below QTI-Yellow. It is down 2.1% since that sell signal. It is a Yellow Bear, which offers no bullish support.

The Near-term Indicant signaled sell on Oct 14, 2010. It is down 9.2% since then. As you can see, it is having difficulty garnishing more bearish behavior.

Interestingly, TLT was not contrarian on today’s bearish behavior. It was even more bearish than most of the major indices and related ETF’s.

The Near-term Indicant and Quick-term Indicant signaled sell for ETF#31-QID on Sep 13, 2010. It is down 30.4% since then. Without a reverse split, this ETF appears to be in search of single digit status. It is currently at $10.94. Interestingly, the stock market tends to punish those that attempt to forecast. As you can see, it has moved north this past week to punish the projection of its single digit price (less than $10). All attributes are no longer solidly bearish. Force is above Pressure and Force is now into a bullish cycle. Those are the only two attributes that support its desired bullishness (and QQQQ’s bearishness). Its solid yellow bear status, though, should minimize its bullish ambition. Keep your eye on Force, It will get a bit more serious if it crosses into bullish domains.

The Near-term Indicant signaled sell on Sep 2, 2010 for ETF#32-VXX. It is down 59.8% since then. As stated yesterday, its Force Vector is nearing a minimum point, offering some hope for a bullish bounce. It enjoyed a solid bullish bounce last Wednesday, but it was inconsistent with Thursday’s bearish behavior and contrary to the VIX’s bullish behavior.

Major ETF Events

Jan 21, 2011-Fri-Transports and S&P600 NTI Blue collapsed. The S&P600 Force Vectors dipped into bearish domains. The S&P600 fell below NTI Green. Although these are bearish attributes, they remain a minority, as most others remain in support of the bull. A bearish spurt may gain some momentum, but current configurations suggest it would be a mere spurt and thus not sustainable.

Jan 20, 2011-Thu-The Near-term Indicant signaled sell for GLD. TLT and VXX were both bearish on today’s bearish stock market and thus not contrarian. The VIX, though, was properly bullish.

Jan 19, 2011-Wed-VIX and VXX enjoyed solid bullish bounces, while retaining their bearish configurations.

Jan 18, 2011-Tue-None

Jan 14, 2011-Fri-GLD fell below NTI Green. That is a significant threat to the near-term hold signal. Force is not yet supporting a sell signal.

Current Strategy-Short-term Indicant- Jan 21, 2011-Tue-Holding remains safe, relative to NTI Green prices. For those of you who bought GLD on Dec 2008 buy signal, wait for the price to fall below Yellow before selling.

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.

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 stock market endured bearish divergence last week, following combined bullish convergence/divergence in six of the prior eight weeks. Any bearish behavior should be viewed as a mere spurt.

Indicant Conclusion

The presidential pre-election year stock market bullishness remains in tact as it has now entered into the strongly bullish pre-election year. Technical support is waning by the Near-term Indicant, but without bearish breadth. Meandering behavior may be confronting the stock market bull. The Indicant Volume Indicator remains depressed, as the post holiday sessions did not introduce significant increases in volume. Volume should increase in coming weeks and months, offering additional obviations of directional intensity.

As stated the past 68-weeks, low interest rates impose narrowed alternative investment opportunities. That narrowed alternative suggests more demand for common stocks. Worldly events may be adjusting in support of the original premise; that is, where else can one put their money to work? The stock market, of course! The stock market bull continues expressing support for this principle.

Political phenomena, coupled with low interest rates, continue in support of the bull. Inflation has not yet threatened the bull. Keep in mind, though, it will at some point in the future unless Congress is successful in reducing 2.5-trillion dollars from the national debt pretty quickly.

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

01/23/2011

Jan 16, 2011 Indicant Weekly Stock Market Report

Volume 01, Issue 03 ISSN 1526 6516 © The Indicant Stock Market Report

Gold’s Bearishness Since 1492

Gold is nearing its record peak from over 500-years ago. According to reliable records, the price of Gold peaked in 1492 at $2,450/oz (in 1995$’s). Gold has been bearish ever since Columbus discovered America.

At that time, most believed the earth was flat. It is interesting that a long held belief in a flat world coincides with gold’s peak price. Before and during flat earth mentality, a few human beings somehow managed to create monarchies. Apparently, flat earth believers were easily manipulated and controlled by those select few, who positioned themselves at the monarch’s helm.

These so-called cultural leaders horded gold. They probably reasoned that their ownership of it was their birthright. Most monarchs did not extract gold; they simply took it from others, who owned. Large stashes of gold correlated to large armies. Some kingdoms would attack other kingdoms when threatened by their accumulation of yet more gold. With that corny psychology, the price of gold spiraled north for several hundred years.

Columbus’ discovery of the Americas challenged the flat earth mentality. Although not necessarily causative, it is interesting the peak price of gold correlated with this challenge to conventional beliefs that the earth was flat until 1492.

About 150-years ahead of Columbus’ discovery, the first formal challenge to prevailing monarchies was the Magna Carta in 1215. The Magna Carta was rewritten several times since the original draft but never culminating in a complete conclusion that no one human being was born superior to another.

Distinctions of superior versus inferior must be demonstrated and not detectable at birth. Since 1776, when such distinctions were recommended in the U.S. Constitution, the devolving political systems around the world has increasingly punished those who demonstrated superior skills and increasingly rewarded those with inferior results. In essence, resources have consistently been taken from the more productive and given to the least productive by the new monarchies (politicians).

The biggest challenge to gold bullishness is the Tea Party, who argues against taking from the productive and giving to the non-productive. That argument is shrouded with the national debt. Gold’s bullishness correlates very well with national debt, very similar to monarch’s hoarding prior to 1492.

Since 1895, the Dow is currently out-performing Gold by over 20:1. That is because productivity in the last century was unparalleled in history. Peace was more common than wars. Democracies evolved. Great products were created, diminishing the value and importance of gold during the 1900’s.

The national debt has more than doubled since 2000. With that, gold prices have steadily increased and nearly approaching its prior peak in 1492. It will continue to rise if “political debt” continues to rise.

However, if the Tea Party drives a profound change in culture, the price of gold should collapse. Gold does not add value; people add value, but only those who are productive do so. The Near-term Indicant is configuring with potential bearishness in gold. Monarchies were not productive. Governments are not productive. Politicians are not productive. If the populace recognizes this and removes the non-productive from cultural influence, gold prices will collapse. Government debt levels will be telling.

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 295 of the 340-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 46.9%. That annualizes to 49.3%. The Mid-term Indicant has been signaling hold for these 295-stocks and funds for an average of 49.5-weeks.

The Mid-term Indicant is avoiding 42-stocks and funds of 340-tracked by the Indicant. The avoided stocks and funds are down an average of 49.3% since the Mid-term Indicant signaled sell an average of 118.0-weeks ago.

One year ago, on Jan 15, 2010, the Mid-term Indicant was holding 226-stocks and funds out of 333 tracked for an average of 30.5-weeks. They were up by an average of 28.4% (annualized at 48.5%). There were 91-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 42.6% since their respective sell signals an average of 97.8-weeks earlier one year ago. There were no buy signals on this weekend last year.

The Mid-term Indicant was signaling hold for only 36-stocks and funds of the 344-tracked two years ago on Jan 16, 2009. They were up by an average of 59.1% (annualized at 61.7%) since their respective buy signals an average of 34.9-weeks earlier. The Mid-term Indicant was avoiding 308-stocks and funds at that time. They were down an average of 35.4% since their respective sell signals an average of 34.9-weeks earlier. There were no buy signals on this weekend in 2009.

There were 171-stocks and funds with hold signals on Jan 11, 2008 since their buy signals an average of 146.1-weeks earlier. They were up by an average of 170.7% (annualized at 60.7%). There were 159 avoided stocks and funds at that time. They were down by an average of 15.6% from their respective sell signals an average of 15.3-weeks earlier. There were 15-sell signals on this weekend in 2008 in addition to the 156-sell signals in the prior nine weeks, as the bear market was already well underway at this point in early 2008. Although performance levels remained excellent, many stocks and funds were beginning to display souring configurations.

On Jan 12, 2007, the Mid-term Indicant was signaling hold for 313-stocks and funds out of 345-tracked. They were up by an average of 105.7% (annualized at 61.2%) since their buy signals an average of 89.9-weeks earlier. The Mid-term Indicant was avoiding 32-stocks and funds at that time. They were down by an average of 13.3% since their sell signals an average of 20.6-weeks earlier.

Five years ago, on Jan 13, 2006, there were 290-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 113.0% (annualized at 67.1%) since their respective buy signals an average of 87.6-weeks earlier. There were 52-avoided stocks and funds then. They were down an average of 10.6% since their respective sell signals an average of 23.7-weeks earlier.

On Jan 14, 2005, there were 235-stocks and funds with hold signals from the listing of 320-tracked by the Mid-term Indicant at that time. They were up an average of 89.2%, annualizing at 67.1%, since their respective buy signals an average of 69.6-weeks earlier. There were 84-avoided stocks and funds then. They were down by an average of 28.2% since their sell signals an average of 48.1-weeks earlier.

There were 288-stocks and funds with hold signals on Jan 16, 2004. They were up by an average of 67.5%, annualizing at 93.8%, since their buy signals 37.4-weeks earlier. The eight avoided stocks and funds were down an average of 28.9% since their respective sell signals an average of 40.4-weeks earlier.

On Jan 17, 2003, there were 289-stocks and funds with a hold signal, enjoying a 19.6% gain since their respective buy signals an average of 16.1-weeks earlier. That annualized at 63.4%. There were only six avoided stocks at that time. They were down by an average of 33.8% since their sell signals an average of 25.8-weeks earlier. The Mid-term Indicant was tracking 296 stocks and funds in 2002-late 2004.

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.

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

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

The stock market divergence gaps are narrowing. Convergence is needed for bullish sustainability. Configured attributes are shifting toward greater convergence and therefore bullish.

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

Long after a successful buy, monitor prices relative to the bearish yellow curve. That will minimize the number of trades, while protecting portfolio values.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 61.8% since its secular weekly low on October 9, 2002. The NASDAQ is up 147.3% and the S&P500 is up 66.5% since then. The small cap index, S&P600, is up 149.5% 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. That will again be an attribute to monitor in coming months if the stock market moves bearishly by significant amounts. Such bearishness is unlikely based on current configurations. Historical standards and political climate support continued bullishness during 2011.

The NASDAQ is down 45.4% since its last weekly secular peak on March 9, 2000. The S&P500 is down 15.3% since its similar secular peak on March 23, 2000. The Dow is up by 0.5% 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.

The NASDAQ year-to-date performance was bearish by 6.3% through this week in 2001. The NASDAQ finished 2001 down by 21.4%, which was congruent with standards of post-election-year-bearishness.

The NASDAQ was up by 2.1% 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 NASDAQ stock market bear cycle found bottom in October 2002, which was consistent with the mid-term year’s historical standards of finding bottoms in mid-term election years.

The NASDAQ YTD 2003 performance was up by 9.4%. It finished up by 50.0% in 2003, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 5.4% and finishing up for that year by 1.4%. This was congruent with election year bullishness, although shy of magnitude standards.

It was down 5.1% on this weekend in 2005’s post election year, which was consistent with historical standards of losses and/or minimal gains. This was an excellent year, based on post election year historical standards of bearishness. Many of you recall that 2004 and 2005 were meandering bear markets.

In 2006, the NASDAQ was up 5.1% on this weekend. It finished up in 2006 by 9.5%, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 3.6% at this time in 2007, finishing up by 9.8%, which was consistent with pre-election year bullishness. The stock market peaked in 2007 from the 2003 bull leg after democrats took control of Congress in early 2007. George W. went along with them as opposed to repelling them. That accelerated the bear and added depth to its decline.

The NASDAQ was down by 6.6% on this weekend in 2008. It finished 2008 down by 40.5%. That was extreme contrarian performance to the standards of historical election year bullishness. It was the most bearish presidential election year since related records from 1832. It was up 5.5% on this weekend in 2009. Keep in mind, this extraordinary bullish cycle in 2009 finished that year down by 20.6% from its prior Mid-term cyclical peak on October 31, 2007. Historians will view that extraordinary bullishness as a mere spurt (reverberation) from 2008’s severe bear market. The 2008 bear market more accurately reflected economic fundamentals than the 2009 bull market. Much of the 2009 bull market correlated well with declining political popularity.

The NASDAQ was up 2.1% on this weekend last year. It finished 2010 up by 16.9%, which was consistent with mid-term election year bullishness; especially in the second half of such years.

The Dow is down 16.8% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 3.6% since its last peak on Oct 31, 2007. The S&P500 is down 17.4% since its Oct 9, 2007 peak. The S&P600-small cap index is down 4.3% 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.

Interestingly, the NAS100 topped its pre-crash highs of 2007/8. It is up by 3.8% since its Oct 31, 2007 peak. The S&P400 eclipsed the 2007/8-precrash high this past week. It was up 2.3% last week and now up 0.5% since its prior peak on July 13, 2007. The Nov 14, 2010’s weekly report discussed this phenomenon.

The Dow is up 80.0% since March 9, 2009, which is the “bottoming” pivot date from the great bear market of 2007/8. The NASDAQ is up 117.2% and the S&P500 is up 91.2% since then. The S&P600, Small Cap Index, is up 134.4% since March 9, 2009. That March 2009-January 2010 bull leg was indeed powerful, but such cycles have occurred many times in the past only to be followed by bear cycles of varying breadth and depth. The Mid-term Indicant and Short-term Indicant are no longer suggesting impending bearishness. The Mid-term Indicant is suggesting potential meandering behavior, but not yet strongly so.

Political behavior is favoring the stock market bull with pressure to reduce government waste. Anticipating that is bullish.

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.

The 3-month T-Bill remains flat and depressed, along with short-term CD’s. The 2012 forecasted values do not yet indicate any significant increases. Keep in mind these forecasts are purely statistical, but qualitative inquiries are not suggesting different projections at this time. However, the 6-month CD yield increased significantly five weeks ago, suggesting desired longer-term upward pressures. Even with this new development, it remains depressed. Anyone buying a 6-month CD at 0.41% with 2+% CPI is heading to the poor house unless deflationary pressures manifest. At any rate, all CD’s remain as Yellow Bears.

The Euro remains neutral with weakening trend and weakening mid-term cycle. This behavior tracks more closely to its long-term cyclical decline. The Canadian dollar, like the Yen, has been stable the past several weeks. Its cyclical direction and trend remain bullish. The CA$ tends to parallel oil prices, but the forecast for the CA$ continues with projected weakening. Although the Japanese Yen weakened in four of the past seven weeks, its trend and mid-term cycle strengthening trend remains in tact. It was mildly bullish this past week.

Overall, the US dollar strengthened the past six weeks, but continues to weaken against the Japanese Yen (high productivity) and the Canadian dollar (resource rich).

As stated by the Indicant for several months, it is priced where the Kingdom finds comfort at around $80/bbl. The high end forecast, though, projects $120/bbl by 2012. The Saudi Kingdom will have to approve that, though. Reports suggest the kingdom is now comfortable at $100/bbl. It has been vacillating around $90/bbl the past several weeks with some speculative bullishness and solid economic reasons for that bullishness.

Scrolling down a bit on the aforementioned webpage, you will find the Reuter’s UK Commodities Index continues moving north since early 2009. It is a Red Bull. It continues to skyrocket, setting a new all time high during the week of November 8, 2010. It remains economically bullish with inflationary considerations later. The CRB Bridge Futures continues its shift from waffling to more bullish aggression. It is also a solid Red Bull.

Commodities, overall, discontinued behavior consistent with uncertainty in favor of outright bullishness. “Extract baby extract” is the evolving theme.

Mortgage rates were a bit bearish the past few days, aligning with its cyclical and longer-term trend. They did not find comfort at their first Red Curve interaction since late 2008 this past week.

The consumer price index and producer price index continue to be relatively stable.

Overall, hard economic data is stabilizing, albeit with increasing commodity prices. That is non-bearish, but lending support to longer-term inflationary potential. At some point, the U.S. Congress will learn they have no influence on how China and India manage their economies; both of which will enjoy larger economies than the U.S. at some point. If they retain a penchant for capitalism, rest assured prices for all commodities will escalate. However, the rising productivity associated with capitalists could dampen the effects on consumers. These economic shifts are unparalleled in the annals of history.

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 again signaled buy on Sep 17, 2010. It is up 11.2%, annualizing at 33.8% since then. It was mildly bullish last week.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 15.8% since then, annualizing at 11.5%. This lazy fund was solidly bearish the past two weeks.

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. The Mid-term Indicant signaled buy on Sep 17, 2010 following a couple of buy/sell cycles since late 2008. It is up 21.4%, annualized at 64.8% since the more recent buy signal.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003 until the next sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 17, 2010, following a couple of buy/sell cycles since late 2008. It is up 36.2%, annualized at 109.6%, since its Sep 17, 2010 buy signal. This was also solidly bullish last week.

The Quick-term and Near-term Indicant signaled, buy, for ETF#03 – Energy and Natural Resources on Sep 15, 2010. It is up 30.4% since then, annualizing at 90.5%. It was up 242.4% (annualized at 44.8%) since the 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 64.5% since that buy signal, annualizing at 30.4%. 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 27.1%. The Near-term Indicant signaled buy on April 24, 2009 and it gained 17.3% until its sell signal on Feb 4, 2010. It received a sell signal from the Near-term Indicant on Jul 27, 2010, but received a new buy signal on Aug 9, 2010. It is up 13.0% since that buy signal, annualizing at 29.7%. The near-term model lost an opportunity of about 2% between Jul 27 and Aug 9, 2010.

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

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

All the major indices are up by an average of 25.6% since their bull signals an average of 40.6-weeks ago. That annualizes at 32.8%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $30,914,021. That beats buy and hold performance of $1,793,303 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $152,835. That beats buy and hold’s $126,676 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $235,675. That beats buy and hold’s $95,537 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1623.9%, 20.7%, and 146.7%, respectively, for these indices as of this past week.

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.

Click here for the Mid-term Table of Mutual Funds.

The Mid-term Indicant signaled sell for MF#22-ProFunds Ultra Short on April 3, 2009. It is down 75.3% since then. It will receive a buy signal only if the Quick-term Indicant signals buy for QID, which occurred last August, but quickly endured “fluttering” behavior, followed by bearish aggression. A sell signal quickly ensued. That fluttering prevented the buy signal for MF#22.

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 307.2% (annualized at 15.9%) since the Long-term Indicant signaled bull 1,002-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, including relative performance 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.

Influencing parameters in the LTI include prior bull cycles. The great bull market in the 1990’s was powerful enough to offset the 2008-2009 recessionary bear market in this long-term modeling.

The Short-term Indicant Stock Market Report

Short-term Indicant Stock Market Report - Summary

As stated the past several days, “all Short-term attributes support the stock market bull.” The S&P600 lazy configuration abated. EWZ-Brazil also, this past week, smacked bearish interest with a more bullish configuration.

ETF#11-GLD fell below NTI Green today. It is near a near-term sell signal, while the Quick-term Indicant remains comfortable in holding until contact with QTI Yellow. Keep in mind, the QTI signaled buy on December 11, 2008 at $80.65. QTI Yellow is at $121.75 and will continue to rise even if GLD moves with bearish aggression. Therefore, a long-term capital gain of over 50% should be realized at a minimum.

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

The Near-term Indicant signaled no new bulls and no new bears. Click this sentence to see table leading to the charts.

The Short-term Indicant is signaling bull for all eleven non-contrarian indices. These bulls are up 13.7% since the NTI signaled bull an average of 13.8-weeks ago. That annualizes to 51.6%. The lone bear is contrarian VIX. It is down 28.8% since its bear signal 17.1-weeks ago.

The Quick-term Indicant signaled bear for contrarian VIX on Sep 16, 2010. It is down 28.8% since that bear signal.

The Quick-term Indicant is signaling bull for all eleven major non-contrarian indices. The eleven major indices are up by an average of 15.6% since the bull signal an average of 17.8-weeks ago, annualizing at 45.5%.

Short-term Market Summary

The majority of Force Vectors remain in bullish domains, supporting the bull.

Eleven QTI Red Bulls mitigate stock market bearish sustainability. Eleven NTI Blue bulls add bullish support. Any bearish behavior should be viewed as a mere spurt; no sustainability. As long as prices remain above NTI Bullish Blue, the bear will continue with its depression and impotence.

VIX Force continues shifting south, as it has done all this past week on low Pressure. It continues offering no threat to the stock market bull.

As stated the past several days, the bull continues gaining stock market breadth, adding bullish propulsion.

Indicant Volume Indicators

Jan 14, 2011-Fri-Volume nudge up on mild bullish behavior on lackluster news. Bullish bias prevails.

Jan 13, 2011-Thu-Mediocre volume on mild bearish behavior supports bullish bias.

Jan 12, 2011-Wed-Mildly aggressive volume on bullish behavior supports continuation of stock market bull.

Jan 11, 2011-Tue-Mediocre volume supports the status quo of the stock market bull.

Jan 10, 2011-Mon-Volume remains non-descriptive and thus no change in bias, which remains bullish.

Jan 7, 2011-Fri-Big board volume was slightly above average for the first time in several months. NASDAQ volume was flat. That coupled with mild bearishness suggests status quo; that is bullish.

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 16.3% since their buy signals an average of 17.6-weeks ago. This annualizes at 48.3%.

The NTI is avoiding three ETF’s. They are down by an average of 34.4% since their sell signals an average of 16.6-weeks ago. They are contrarians, QID, VXX, and TLT.

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 20.3% since their buy signals an average of 25.0-weeks ago. This annualizes at 42.3%.

The Quick-term Indicant is avoiding 3-ETF’s (QID, VXX, TLT). They are all contrarian ETF’s. They are down by an average of 42.5% since their sell signals an average of 39.2-weeks ago.

Short-term Summary: There are 27-Red Bulls (stable on Friday), mitigating dynamic and sustainable bearish behavior. The 28-NTI Blue Bulls (gained three on Friday) add bullish support. Force Vectors are moving more unanimously in favor of the bull after some mild rotations the past few days.

Contrarian Funds

ETF#03-Natural Resources. The Near-term and Quick-term Indicant signaled buy on Sep 15, 2010. It is up 30.4%, annualizing at 90.5%, since then. This ETF remains with Red Bull status, mitigating sustainable bearish threats. The “energy bear” cannot find sustainable forces with current bullish attributes. Force shifted back to the north last Wednesday, mitigating concerns about falling to NTI Green curve. This remains solidly bullish.

ETF#11-Gold and Precious Metals is up 64.5% since the QTI signaled buy on December 11, 2008. Annualized growth is at 30.4%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $121.75 and still rising. Being patient here is important since your buy price approximates $80.65.

The Near-term Indicant signaled buy on Aug 9, 2010. It is up 13.0% since the Near-term buy signal, annualizing at 29.7%.

In addition to losing several bullishly supporting attributes last Wednesday, GLD is no longer a Red Bull. This condition, though, has occurred several times during this Quick-term cycle only to be followed by yet more bullish behavior. The current price is $132.69 and the NTI Green price is $133.33. As you can see, it fell below NTI Green this Friday. Therefore, it is qualified for a Near-term sell signal. There is one last attribute suggesting a bit of patience here. The Force Vector is moving north. However, when it shifts south, with price less than the Green curve, the Near-term Indicant will have to signal sell. Keep in mind the Quick-term Indicant should be your model of choice if you bought in Dec 2008.

Click this sentence for additional charting and current forecasting of the actual price of gold.

ETF#14-TLT-Long Government received a sell signal from Quick-term Indicant on Nov 15, 2010, as price fell below QTI-Yellow. It is down 1.8% since that sell signal. It is a Yellow Bear, which offers no bullish support.

The Near-term Indicant signaled sell on Oct 14, 2010. It is down 8.9% since then. As expected, the TLT-bear was aroused and is now completely dominating this ETF. There are no meaningful attributes supporting any bullish potential at this time. Resistance to bearish behavior is impressive and a fall to $85 or so may be delayed, as the stock market bull has been a bit lazy, but a bull nonetheless.

The Near-term Indicant and Quick-term Indicant signaled sell for ETF#31-QID on Sep 13, 2010. It is down 33.5% since then. Without a reverse split, this ETF appears to be in search of single digit status. It is currently at $10.77. All attributes are solidly bearish. Not one supports the short-bull.

The Near-term Indicant signaled sell on Sep 2, 2010 for ETF#32-VXX. It is down 60.6% since then.

Major ETF Events

Jan 14, 2011-Fri-GLD fell below NTI Green. That is a significant threat to the near-term hold signal. Force is not yet supporting a sell signal.

Jan 13, 2011-Thu-None

Jan 12, 2011-Wed- ETF#21-EWZ-Brazil, and similarly configured ETF’s, shifted back into a stronger bullish configuration after enduring minor bearish threats.

Jan 11, 2011-Tue-None

Jan 10, 2011-Mon-ETF#21-EWZ-Brazil fell below NTI Blue with Force in bearish domains and positive low Pressure. As you can see, this ETF is lazy with non-bearish and non-bullish behavior for several days.

Current Strategy-Short-term Indicant- Jan 14, 2011-Fri-Holding remains safe. Short-term attributes support continued stock market bullishness, but with some mixed behavior across sectors. Significant divergence is confronting the stock market, but non threatening. Some cooling in some sectors will not be surprising.

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.

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 stock market endured bullish convergence last week, following combined bullish convergence/divergence in six of the prior seven weeks. Any bearish behavior should be viewed as a mere spurt. Although Gold was bearish, it is excluded from convergence algorithms. Gold marches to its own drumbeat.

Indicant Conclusion

The presidential pre-election year stock market bullishness remains in tact as it has now entered into the strongly bullish pre-election year. Technical support is not waning, but meandering behavior may be confronting the stock market bull. The Indicant Volume Indicator remains depressed, as the post holiday sessions did not introduce significant increases in volume. Volume should increase in coming weeks and months, offering additional obviations of directional intensity.

As stated the past 67-weeks, low interest rates impose narrowed alternative investment opportunities. That narrowed alternative suggests more demand for common stocks. Worldly events may be adjusting in support of the original premise; that is, where else can one put their money to work? The stock market, of course! The stock market bull continues expressing support for this principle.

Political phenomena, coupled with low interest rates, continue in support of the bull. Inflation has not yet threatened the bull. Keep in mind, though, it will at some point in the future.

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

01/16/2011

Jan 9, 2011 Indicant Weekly Stock Market Report

Volume 01, Issue 02 ISSN 1526 6516 © The Indicant Stock Market Report

Stock Market’s Response to Assassinations and Insane Acts

The stock market bear quickly dominated after the assassination of President McKinley in 1901. The bear lasted for over two years although with a few bullish spurts before major bearish expressions in 1903. Click this sentence to review a chart of the stock market after President McKinley’s assassination.

Although Dwight Eisenhower survived his heart attack in 1955, it was a major event. The stock market bull was not disturbed. Click this sentence to review its chart. Although not noted on this chart, the U.S. Capitol was attacked by Puerto Rico Nationalists on March 1, 1954. As you can see, a dynamic stock market bull shifted into Red Bull status shortly after shots were fired in the House of Representatives chamber. Five congressional representatives were shot, but not killed. The stock market more or less yawned on this attack.

The stock market bear reacted strongly to John F. Kennedy’s assassination in Nov 1963. However, it was brief. The stock market bull quickly resumed its directional intensity in the same month.

Dr. Martin Luther King and Robert F. Kennedy were assassinated in 1968. Although rioting occurred shortly after King’s assassination, the stock market only meandered. However, it endured a sharp bearish expression after Kennedy’s assassination. This bear only lasted a few days and the stock market bull quickly resumed directional dominance.

The assassination attempt on Ronald Reagan in 1981 demonstrated a very brief bearish response during a meandering stock market. Although a severe stock market bear occurred several months later, it was purely economic driven and not correlated with the attempted assassination of Ronald Reagan. You should also notice the stock market did a poor job of “anticipating the severe economic recession in 1981-82. You should notice the tax cuts were somewhat encouraging. The stock market was attempting to hold up in anticipation of economic robustness, while the economic recession deepened.

The 1990’s were especially tumultuous with the crazies demonstrating their skills. The stock market bull was not disrupted with the World Trade Center bombing in early 1992. The Waco cult siege shortly followed with many deaths without any demonstrable impact on the stock market. The stock market bull yawned through the Oklahoma City bombing in 1995.

The assassination of Federal Judge John Roll and attempted assassination of Gabrielle Giffords this weekend may inspire the stock market bear. As you can see, such acts can be causative to a bearish reaction. However, as you can see from all of the above links, such reactions are short and offer little evidence of sustainability.

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 295 of the 340-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 44.2%. That annualizes to 47.4%. The Mid-term Indicant has been signaling hold for these 295-stocks and funds for an average of 48.5-weeks.

The Mid-term Indicant is avoiding 42-stocks and funds of 340- tracked by the Indicant. The avoided stocks and funds are down an average of 50.7% since the Mid-term Indicant signaled sell an average of 117.0-weeks ago.

One year ago, on Jan 8, 2010, the Mid-term Indicant was holding 214-stocks and funds out of 333 tracked for an average of 30.5-weeks. They were up by an average of 30.9% (annualized at 52.7%). There were 91-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 42.2% since their respective sell signals an average of 96.8-weeks earlier one year ago. There were 12-buy signals on this weekend last year.

The Mid-term Indicant was signaling hold for only 36-stocks and funds of the 344-tracked two years ago on Jan 9, 2009. They were up by an average of 52.4% (annualized at 64.9%) since their respective buy signals an average of 41.9-weeks earlier. The Mid-term Indicant was avoiding 308-stocks and funds at that time. They were down an average of 33.7% since their respective sell signals an average of 33.9-weeks earlier. There were no buy signals on this weekend in 2009.

There were 254-stocks and funds with hold signals on Jan 4, 2008 since their buy signals an average of 138.2-weeks earlier. They were up by an average of 160.9% (annualized at 60.5%). There were 102 avoided stocks and funds at that time. They were down by an average of 13.9% from their respective sell signals an average of 19.6-weeks earlier. There were 57-sell signals on this weekend in 2008 in addition to the 99-sell signals in the prior eight weeks, as the bear market was already well underway at this point in early 2008. Although performance levels remained excellent, many stocks and funds were beginning to display souring configurations.

On Jan 5, 2007, the Mid-term Indicant was signaling hold for 312-stocks and funds out of 345-tracked. They were up by an average of 100.0% (annualized at 58.4%) since their buy signals an average of 89.0-weeks earlier. The Mid-term Indicant was avoiding 30-stocks and funds at that time. They were down by an average of 13.7% since their sell signals an average of 21.2-weeks earlier.

Five years ago, on Jan 6, 2006, there were 292-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 110.8% (annualized at 66.8%) since their respective buy signals an average of 86.3-weeks earlier. There were 53-avoided stocks and funds then. They were down an average of 10.5% since their respective sell signals an average of 22.5-weeks earlier.

On Jan 7, 2005, there were 236-stocks and funds with hold signals from the listing of 320-tracked by the Mid-term Indicant at that time. They were up an average of 86.7%, annualizing at 65.9%, since their respective buy signals an average of 61.6-weeks earlier. There were only 15-avoided stocks and funds then. They were down by an average of 41.1% since their sell signals an average of 61.1-weeks earlier.

There were 288-stocks and funds with hold signals on Jan 9, 2004. They were up by an average of 63.5%, annualizing at 90.8%, since their buy signals 36.4-weeks earlier. The six avoided stocks and funds were down an average of 29.0% since their respective sell signals an average of 36.4-weeks earlier.

On Jan 10, 2003, there were 284-stocks and funds with a hold signal, enjoying a 22.2% gain since their respective buy signals an average of 15.0-weeks earlier. That annualized at 76.6%. There were only six avoided stocks at that time. They were down by an average of 31.6% since their sell signals an average of 24.9-weeks earlier. The Mid-term Indicant was tracking 296 stocks and funds in 2002-late 2004.

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.

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

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

The stock market divergence gaps are narrowing. Convergence is needed for bullish sustainability. Configured attributes are shifting toward greater convergence and therefore bullish.

The current stock market bull originated in anticipation of stalemated politicians. That has been the historical standard.

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

Long after a successful buy, monitor prices relative to the bearish yellow curve. That will minimize the number of trades, while protecting portfolio values.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 60.2% since its secular weekly low on October 9, 2002. The NASDAQ is up 142.6% and the S&P500 is up 63.7% since then. The small cap index, S&P600, is up 143.7% 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. That will again be an attribute to monitor in coming months if the stock market moves bearishly by significant amounts. Such bearishness is unlikely based on current configurations. Historical standards and political climate support continued bullishness during 2011.

The NASDAQ is down 46.5% since its last weekly secular peak on March 9, 2000. The S&P500 is down 16.8% since its similar secular peak on March 23, 2000. The Dow is down by 0.4% 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.

If socialism continues to expand, the NASDAQ may not hit its 2000 peak until after 2050. Significant downsizing of federal governments and related regulations shrink will stimulate a reassessment of the previous sentence. If the opposite occurs with increasing federal bureaucracies, the NASDAQ will never return to its 2000 peak.

The NASDAQ year-to-date performance was bearish by 2.5% through this week in 2001. The NASDAQ finished 2001 down by 21.4%, which was congruent with standards of post-election-year-bearishness.

The NASDAQ was up by 2.2% 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 NASDAQ stock market bear cycle found bottom in October 2002, which was consistent with the mid-term year’s historical standards of finding bottoms in mid-term election years.

The NASDAQ YTD 2003 performance was up by 7.2%, which was consistent with historical pre-election year results. It was up on this weekend in 2004 by 3.7%, which was congruent with election year bullishness, although shy of magnitude standards.

It was down 4.0% on this weekend in 2005’s post election year, which was consistent with historical standards of losses and/or minimal gains. This was an excellent year, based on post election year historical standards of bearishness. Many of you recall that 2004 and 2005 were meandering bear markets.

In 2006, the NASDAQ was up 4.5% on this weekend, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 0.8% at this time in 2007, which was consistent with pre-election year bullishness. The stock market peaked in 2007 from the 2003 bull leg after democrats took control of Congress in early 2007. George W. went along with them as opposed to repelling them. That accelerated the bear and added depth to its decline.

The NASDAQ was down by 5.8% on this weekend in 2008. That was extreme contrarian performance to the standards of historical election year bullishness. It was the most bearish presidential election year since related records from 1832. It was up 1.4% on this weekend in 2009. Keep in mind, this extraordinary bullish cycle in 2009 finished that year down by 20.6% from its prior Mid-term cyclical peak on October 31, 2007. Historians will view that extraordinary bullishness as a mere spurt (reverberation) from 2008’s severe bear market. The 2008 bear market more accurately reflected economic fundamentals than the 2009 bull market. Much of the 2009 bull market correlated well with declining political popularity.

The Dow is down 17.6% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 5.5% since its last peak on Oct 31, 2007. The S&P500 is down 18.8% since its Oct 9, 2007 peak. The S&P600-small cap index is down 6.5% 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.

Interestingly, the NAS100 topped its pre-crash highs of 2007/8. It is up by 1.7% since its Oct 31, 2007 peak. The NAS100 was up a solid 2.7% last week, catapulting its pre-crash peak. The S&P400 is next closest major index toward attaining pre-crash highs. It is down by only 1.7% since its Jul 13, 2007 peak. The Nov 14, 2010’s weekly report discussed this phenomenon.

The Dow is up 78.3% since March 9, 2009, which is the “bottoming” pivot date from the great bear market of 2007/8. The NASDAQ is up 113.1% and the S&P500 is up 87.9% since then. The S&P600, Small Cap Index, is up 128.9% since March 9, 2009. That March 2009-January 2010 bull leg was indeed powerful, but such cycles have occurred many times in the past only to be followed by bear cycles of varying breadth and depth. The Mid-term Indicant and Short-term Indicant are no longer suggesting impending bearishness. The Mid-term Indicant is suggesting potential meandering behavior, but not yet strongly so.

Political behavior is favoring the stock market bull with pressure to reduce government waste. Anticipating that is bullish.

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.

The 3-month T-Bill remains flat and depressed, along with short-term CD’s. The 2012 forecasted values do not yet indicate any significant increases. Keep in mind these forecasts are purely statistical, but qualitative inquiries are not suggesting different projections at this time. However, the 6-month CD yield increased significantly four weeks ago, suggesting longer-term upward pressures. Even with this new development, it remains depressed. Anyone buying a 6-month CD at 0.41% with 2+% CPI is heading to the poor house unless deflationary pressures manifest. At any rate, all CD’s remain as Yellow Bears.

The Euro remains neutral with weakening trend and weakening mid-term cycle. This behavior tracks more closely to its long-term cyclical decline. The Canadian dollar, like the Yen, has been stable the past several weeks. Its cyclical direction and trend remain bullish. The CA$ tends to parallel oil prices, but the forecast for the CA$ continues with projected weakening. Although the Japanese Yen weakened in four of the past six weeks, its trend and mid-term cycle strengthening trend remains in tact.

Overall, the US dollar strengthened the past five weeks, but continues to weaken against the Japanese Yen (high productivity) and the Canadian dollar (resource rich).

Gold’s optimistic forecast remains at $1600/oz by 2012. As you can see, it is tracking above its high-end forecasted value and it remains a Red Bull to boot. Do not be surprised at $2,000/oz by 2014. At the same webpage, you will notice oil is less stable. As stated by the Indicant for several months, it is priced where the Kingdom finds comfort at around $80/bbl. The high end forecast, though, projects $120/bbl by 2012. The Saudi Kingdom will have to approve that, though. Reports suggest the kingdom is now comfortable at $100/bbl. It has been vacillating around $90/bbl the past few weeks.

Scrolling down a bit on the aforementioned webpage, you will find the Reuter’s UK Commodities Index continues moving north since early 2009. It is a Red Bull. It continues to skyrocket, setting a new all time high during the week of November 8, 2010. It remains economically bullish with inflationary considerations later. The CRB Bridge Futures continues its shift from waffling to more bullish aggression. It is also a solid Red Bull.

Commodities, overall, discontinued behavior consistent with uncertainty in favor of outright bullishness. “Extract baby extract” is the evolving theme.

Mortgage rates were a bit bearish the past few days, aligning with its cyclical and longer-term trend. They did not find comfort at their first Red Curve interaction since late 2008 this past week.

The consumer price index and producer price index continue to be relatively stable.

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 again signaled buy on Sep 17, 2010. It is up 10.6%, annualizing at 34.2% since then. It was solidly bearish last week, following solid bullish behavior in the prior two weeks.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 18.5% since then, annualizing at 13.6%. This lazy fund was solidly bearish last week.

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. The Mid-term Indicant signaled buy on Sep 17, 2010 following a couple of buy/sell cycles since late 2008. It is up 17.1%, annualized at 54.9% since the more recent buy signal.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003 until the next sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 17, 2010, following a couple of buy/sell cycles since late 2008. It is up 29.6%, annualized at 95.0%, since the most recent buy signal. This was also solidly bearish last week.

The Quick-term and Near-term Indicant signaled, buy, for ETF#03 – Energy and Natural Resources on Sep 15, 2010. It is up 26.0% since then, annualizing at 82.3%. It was up 242.4% (annualized at 44.8%) since the 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 65.6% since that buy signal, annualizing at 31.2%. 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 27.1%. The Near-term Indicant signaled buy on April 24, 2009 and it gained 17.3% until its sell signal on Feb 4, 2010. It received a sell signal from the Near-term Indicant on Jul 27, 2010, but received a new buy signal on Aug 9, 2010. It is up 13.8% since that buy signal, annualizing at 32.9%. The near-term model lost an opportunity of about 2% between Jul 27 and Aug 9, 2010.

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

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

All Mid-term attributes remain bullish, but suggesting potential for meandering behavior. Do not be surprised at some profit taking ahead of the normally bearish February. Last week’s report erroneously stated all attributes were solidly bearish in this section.

All the major indices are up by an average of 23.7% since their bull signals an average of 39.6-weeks ago. That annualizes at 31.1%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $30,618,660. That beats buy and hold performance of $1,776,169 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $150,266. That beats buy and hold’s $124,547 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $231,216. That beats buy and hold’s $93,730 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1623.9%, 20.7%, and 146.7%, respectively, for these indices as of this past week.

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.

Click here for the Mid-term Table of Mutual Funds.

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 303.3% (annualized at 15.8%) since the Long-term Indicant signaled bull 1,001-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, including relative performance 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.

Influencing parameters in the LTI include prior bull cycles. The great bull market in the 1990’s was powerful enough to offset the 2008-2009 recessionary bear market in this long-term modeling.

The Short-term Indicant Stock Market Report

Short-term Indicant Stock Market Report - Summary

As stated the past several days, “all Short-term attributes support the stock market bull.” The S&P600 fell below NTI Blue today, but nowhere nearing a bear signal.

Demand/money rotation continues, which is invoking sector variances to general stock market direction. Although divergent behavior is discerning, the bear remains non-threatening for the time being.

TLT remains solidly bearish with no available points of resistance to bearish aggression. GLD lost its Red Bull status last Thursday. It is nearing NTI Green curve, where volatile behavior usually occurs.

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

The Near-term Indicant signaled no new bulls and no new bears. Click this sentence to see table leading to the charts.

The Short-term Indicant is signaling bull for all eleven non-contrarian indices. These bulls are up 11.9% since the NTI signaled bull an average of 12.8-weeks ago. That annualizes to 48.2%. The lone bear is contrarian VIX. It is down 21.1% since its bear signal 16.1-weeks ago.

The Quick-term Indicant signaled bear for contrarian VIX on Sep 16, 2010. It is down 21.1% since that bear signal.

The Quick-term Indicant is signaling bull for all eleven major non-contrarian indices. The eleven major indices are up by an average of 13.7% since the bull signal an average of 16.1-weeks ago, annualizing at 42.4%.

Short-term Market Summary

The majority of Force Vectors remain in bullish domains, supporting the bull. However, the S&P600 dipped below today and also fell below NTI Bullish Blue Curve. Its Force Vector cycle is mature, minimizing any threat by the stock market bear.

Eleven QTI Red Bulls mitigate stock market bearish sustainability. Ten NTI Blue bulls add bullish support. Any bearish behavior should be viewed as a mere spurt; no sustainability. As long as prices remain above NTI Bullish Blue, the bear will continue with its depression and impotence.

VIX Force continues shifting south, as it has done all week on low Pressure. It continues offering no threat to the stock market bull.

As stated the past several days, the bull continues gaining stock market breadth, adding bullish propulsion.

Indicant Volume Indicators

Both volume indicators are falling at already low volume depths. Much of this recent decline was influenced by holiday volume. Historical seasonal standards suggests stock market bullishness, while volume indicates hesitancy to do so. However, this has been a low volume bull since inception in May 2009. Current configurations continue suggesting this low volume bull will continue with the occasional and normal bearish spurts intervening from time to time.

Jan 7, 2011-Fri-Big board volume was slightly above average for the first time in several months. NASDAQ volume was flat. That coupled with mild bearishness suggests status quo; that is bullish.

Jan 6, 2011-Thu-Volume continues on the low side of normalcy. Bullish bias prevails.

Jan 5, 2011-Wed-Volume is normal, but remaining shy of robust support. Bullish bias prevails.

Jan 4, 2011-Tue-Volume remains lackluster. However, bullish bias prevails.

Jan 3, 2011-Mon-Volume returned to near normalcy on aggressive bullishness. In spite of timid normal volume, bullish bias prevails.

Dec 31, 2010-Fri-Volume remains at holiday levels. Normalcy will occur next week. Those vacationing will not know what to do, as the bull is lazy and the bear has no spirit.

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 14.3% since their buy signals an average of 16.6-weeks ago. This annualizes at 44.8%.

The NTI is avoiding three ETF’s. They are down by an average of 31.4% since their sell signals an average of 15.6-weeks ago. They are contrarians, QID, VXX, and TLT.

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 18.3% since their buy signals an average of 24.0-weeks ago. This annualizes at 39.6%.

The Quick-term Indicant is avoiding 3-ETF’s (QID, VXX, TLT). They are all contrarian ETF’s. They are down by an average of 41.0% since their sell signals an average of 38.2-weeks ago.

Short-term Summary: There are 27-Red Bulls, mitigating dynamic and sustainable bearish behavior. The 21-NTI Blue Bulls add bullish support. Force Vectors are directionally mixed. Demand rotation is not yet threatening hold position. Sector volatility should not be surprising.

Contrarian Funds

ETF#03-Natural Resources. The Near-term and Quick-term Indicant signaled buy on Sep 15, 2010. It is up 26.0%, annualizing at 82.3%, since then. This ETF remains with Red Bull status, mitigating sustainable bearish threats. The “energy bear” cannot find sustainable forces with current bullish attributes.

ETF#11-Gold and Precious Metals is up 65.6% since the QTI signaled buy on December 11, 2008. Annualized growth is at 31.2%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $121.16 and still rising.

The Near-term Indicant signaled buy on Aug 9, 2010. It is up 13.8% since the Near-term buy signal, annualizing at 32.9%.

In addition to losing several bullishly supporting attributes last Wednesday, GLD is no longer a Red Bull. This condition, though, has occurred several times during this Quick-term cycle only to be followed by yet more bullish behavior. The current price is $133.58 and the NTI Green price is $133.18. Although its Force Vector is in bearish domains, the NTI cannot signal sell until price falls below NTI Green. It is getting close. Interaction will be interesting. Its Force Vector cycle is bearishly mature, offering the gold bull some potential inspiration.

Click this sentence for additional charting and current forecasting of the actual price of gold.

ETF#14-TLT-Long Government received a sell signal from Quick-term Indicant on Nov 15, 2010, as price fell below QTI-Yellow. It is down 1.2% since that sell signal. It is a Yellow Bear, which offers no bullish support.

The Near-term Indicant signaled sell on Oct 14, 2010. It is down 8.4% since then. As expected, the TLT-bear was aroused and is now completely dominating this ETF. There are no meaningful attributes supporting any bullish potential at this time. Do not be surprised at it falling below $90 and possibly to $85 in this cycle.

The Near-term Indicant and Quick-term Indicant signaled sell for ETF#31-QID on Sep 13, 2010. It is down 30.8% since then. Without a reverse split, this ETF appears to be in search of single digit status. It is currently at $11.03. All attributes are solidly bearish. Not one supports the short-bull.

The Near-term Indicant signaled sell on Sep 2, 2010 for ETF#32-VXX. It is down 55.0% since then. Force fell below Vector Pressure today after hovering for several days. However, Pressure remains low and thus void of sustainable bullish behavior for this ETN.

Major ETF Events

Jan 7, 2010-Fri-Five ETF’s and the S&P600 fell below NTI Blue Bull Curve. Although not threatening, it will be interesting to see if the bear finds inspiration with this expressed weakness by the bull.

Jan 6, 2010-Thu-GLD lost its Red Bull status today and within a dollar of its NTI Green curve. Force is in bearish domains. If GLD falls below Green, the NTI will signal sell.

Jan 5, 2010-Wed-TLT was shattered today. It is solidly bearish with no points of resistance for additional bearishness.

Jan 4, 2010-Tue-GLD was again bearish today and aggressively so. It is not yet at NTI Green, where volatile expressions are heightened. Its Force Vector was decidedly bearish today with a solid southerly movement. The Near-term Indicant will signal sell if Force dips into bearish domains price dips below green. The Quick-term Indicant will not consider selling until price interacts with QTI Bearish Yellow.

Jan 3, 2011-Mon-GLD apparently found little comfort above its NTI Bullish Blue Curve. It was purely contrarian, falling below NTI Blue on stock market bullishness.

Current Strategy-Short-term Indicant- Jan 7, 2011-Fri-Holding remains safe. Short-term attributes support continued stock market bullishness, but with some mixed behavior across sectors. Significant divergence is confronting the stock market, but non threatening. Some cooling in some sectors will not be surprising.

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.

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 stock market endured bullish divergence last week, following combined bullish convergence/divergence in five of the prior six weeks. Any bearish behavior should be viewed as a mere spurt. Commodities and energy were significantly bearish last week on a strong dollar, which did not encourage the stock market bear as it has done in the past.

Indicant Conclusion

As stated the past 66-weeks, low interest rates impose narrowed alternative investment opportunities. That narrowed alternative suggests more demand for common stocks. Worldly events may be adjusting in support of the original premise; that is, where else can one put their money to work? The stock market, of course! The stock market bull continues expressing support for this principle.

Political phenomena, coupled with low interest rates, continue in support of the bull. Inflation has not yet threatened the bull. Keep in mind, though, it will at some point in the future.

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

01/09/2011

Jan 2, 2011 Indicant Weekly Stock Market Report

Coming Together versus Absence of Synthesis

As stated in the past, one conveys an argument. When there is no resistance, such arguments prevail. It may manifest to into complete cultural shifts. German citizens during the 1930’s enjoyed the thesis of the Nazi party. Unfortunately, they endured the consequences of that by the mid-1940’s. Many died and those who lived endured massive misery.

Beware when one says, “hey, let’s come together.” Coming together with a stupid idea always results in unfavorable consequences. The intelligence and energy required for conveying a thesis is miniscule. Adopting any argument without resistance takes even less energy.

During 2009 and early 2010, the democratic controlled congress did not come together with antithesis views from their republican counterparts. The democrats did not have to do that. They enjoyed enough majority to basically ignore the bickering republicans.

Furthermore, the democrats controlled the executive branch of government. Consequently, the democratic controlled congress did not meet resistance from the executive branch. History consistently demonstrates this bearish relationship for both the economy and the stock market.

It is impossible for politicians to add economic value. Their heightened activity typically influences a bearish stock market. Politicians, however, have several purposes, some of which are of high value, but none of those purposes has anything to do with economics. However, politicians must use the word, give, during their campaigns or they, for the most part, will not be elected. This invokes negative economics.

Since politicians produce nothing, they must “take” before they “give.” You seldom hear them say the word, take, though. Hillary Rodman Clinton made this mistake in 2008 campaigning when she said she would “take” Exxon profits and do something else with it. Other than that diseased comment, you seldom hear the word, take. Politicians spend quite a bit of time inventing sneaky schema to take.

This give and take is a common characteristic of democracies. The political sector gains more power when the majority expects what is given to them by politicians. That suggests the populace “came together” with their political leaders. Those with a political penchant love it when the masses have their hands out. Politicians enjoy their moments of passing out their gifts according to their personal desires.

History suggests this phenomenon is the Achilles heel of democracies. The majority eventually becomes corrupt when they “come together” with their political leadership.

Capitalists do not try to win arguments with chitchat and white papers. They expend significant energy producing products or services of value. Their markets either absorb their efforts or not. If not, the capitalistic enterprise ceases to exist. Capitalists do not have the option of conveying a “come together” argument. Either they produce the required results for survival or they are out of business. Contemporary politicians have rigged the system, mitigating personal consequences even in the face of political defeats at the election polls. Accurate thinking and decision-making cannot be optimized without personal risks, relating to those decisions.

Senators enjoy guaranteed employment for six years without any consideration to their performance. The U.S. founding fathers did not perceive their successors would make it a full time job. Economic leeches should not work so much. Unfortunately, the nature of politicians in their “give” and “take” existence can only leech the economy. This leeching apparently requires fulltime efforts.

One powerful dynamic foreseen by the founding fathers of the U.S. Constitution was the freedom of the press. That contrasts with closed societies, such as communism and Nazism, where politicians control the press. Such societies do not last long, as the leeching process devours all resources very quickly. The effects of such failing systems, though, can linger for several generations. For example, the life expectancy of a Russian male is 58-years of age. Three generations of communism weakened their cultural constituents.

Technological advances created by capitalists fostered a new dynamic during massive economic leeching by capitalists during 2008/9. A new thruster group evolved; the tea party movement. The freedom of press and the power of the Internet facilitated the rapidly forming tea party movement. This thruster group expanded rapidly. It paralleled declining popularity of incumbent politicians.

Most thruster groups are small in numbers. If they have a good idea and stick to it by not “coming together” with their opponents, they may evolve into a majority of the populace. The Nazi party was a small thruster group in the late 1920’s. By the middle of the 1930’s it evolved into the majority of Germany and other countries. Tea party activists remain as a minority group, but increasing in numbers.

Large thruster groups have profound influences on legal, moral, and cultural systems and related behavior; sometimes negatively and sometimes positively. The tea party banters the U.S. Constitution, which is positive. The founding fathers created it with significant personal risks; thus, their thinking was accurate.

A multitude of disagreeing philosophical thruster groups is bullish in a capitalistic system. These philosophers produce nothing. Many hang around in coffee shops, bantering their intellectual prowess, while the capitalists that clothed them are working hard on clothing more including the non-intellectualists. Those bantering souls may be right or they may be wrong. Regardless though, their bantering adds no value. The words rolling off their tongues span into the air with eventual dissipation.

The tea party thruster group clashes with so-called “cultural elitist.” Both groups, when pontificating their values and mores, are pure economic overhead. However, if both groups stalemate each other with the same consequence into the political powers they support, the stock market will be bullish. The stock market supports capitalists and fears any form of non-capitalistic behavior. The bull is aroused when pontificators from varying thesis stalemate each other. The absence of political synthesis is bullish. Undoing prior political synthesis is powerfully bullish for the economy and the stock market.

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 292 of the 340-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 43.0%. That annualizes to 46.3%. The Mid-term Indicant has been signaling hold for these 292-stocks and funds for an average of 48.2-weeks.

The Mid-term Indicant is avoiding 42-stocks and funds of 340- tracked by the Indicant. The avoided stocks and funds are down an average of 51.5% since the Mid-term Indicant signaled sell an average of 116.0-weeks ago.

One year ago, on Jan 1, 2010, the Mid-term Indicant was holding 212-stocks and funds out of 333 tracked for an average of 30.0-weeks. They were up by an average of 28.4% (annualized at 49.2%). There were 103-avoided stocks and funds at that time. The avoided stocks and funds were down an average of 42.3% since their respective sell signals an average of 94.5-weeks earlier one year ago. There were two buy signals on this weekend last year.

The Mid-term Indicant was signaling hold for only 33-stocks and funds of the 344-tracked two years ago on Jan 2, 2009. They were up by an average of 60.2% (annualized at 73.4%) since their respective buy signals an average of 42.7-weeks earlier. The Mid-term Indicant was avoiding 308-stocks and funds at that time. They were down an average of 32.7% since their respective sell signals an average of 32.9-weeks earlier. There were three buy signals on this weekend two years ago as the bear’s wrath was beginning to wane.

There were 254-stocks and funds with hold signals on Dec 28, 2007 since their buy signals an average of 128.7-weeks earlier. They were up by an average of 147.6% (annualized at 59.6%). There were 102 avoided stocks and funds at that time. They were down by an average of 13.6% from their respective sell signals an average of 18.6-weeks earlier. There were 33-sell signals on this weekend in 2007 in addition to the 63-sell signals in the prior seven weeks, as the bear market was already well underway at this point in 2007. Although performance levels remained excellent, many stocks and funds were beginning to display souring configurations.

On Dec 29, 2006, the Mid-term Indicant was signaling hold for 313-stocks and funds out of 345-tracked. They were up by an average of 106.1% (annualized at 62.7%) since their buy signals an average of 85.8-weeks earlier. The Mid-term Indicant was avoiding 31-stocks and funds at that time. They were down by an average of 16.0% since their sell signals an average of 20.2-weeks earlier.

Five years ago, on Dec 30, 2005, 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 94.8% (annualized at 57.5%) since their respective buy signals an average of 85.8-weeks earlier. There were 50-avoided stocks and funds then. They were down an average of 16.0% since their respective sell signals an average of 27.2-weeks earlier.

On Dec 31, 2004, there were 304-stocks and funds with hold signals from the listing of 320-tracked by the Mid-term Indicant at that time. They were up an average of 73.3%, annualizing at 66.2%, since their respective buy signals an average of 57.6-weeks earlier. There were only 15-avoided stocks and funds then. They were down by an average of 39.6% since their sell signals an average of 60.1-weeks earlier.

There were 286-stocks and funds with hold signals on Jan 2, 2004. They were up by an average of 57.7%, annualizing at 83.9%, since their buy signals 38.6-weeks earlier. The six avoided stocks and funds were down an average of 28.6% since their respective sell signals an average of 38.6-weeks earlier.

On Jan 3, 2003, there were 277-stocks and funds with a hold signal, enjoying a 19.1% gain since their respective buy signals an average of 14.3-weeks earlier. That annualized at 69.3%. There were only 12-avoided stocks at that time. They were down by an average of 25.9% since their sell signals an average of 14.3-weeks earlier. The Mid-term Indicant was tracking 296 stocks and funds in 2002-late 2004.

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.

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

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

The stock market divergence gaps are narrowing. Convergence is needed for bullish sustainability. Configured attributes are shifting toward greater convergence and therefore bullish.

The political movement is classical. After destructive behavior by politicians during post election years, pressure is increasing to quit doing that. If the politicians quit their destructive behavior, the stock market bull will be thoroughly delighted. The likelihood of stalemate between the branches of government is increasing. Regulatory laws, though, are somewhat threatening. Such laws need to be eliminated. Where is the evidence that regulators are endowed with superior morals or cerebral capacity to those that are being regulated?

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

Long after a successful buy, monitor prices relative to the bearish yellow curve. That will minimize the number of trades, while protecting portfolio values.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 58.9% since its secular weekly low on October 9, 2002. The NASDAQ is up 138.1% and the S&P500 is up 61.9% since then. The small cap index, S&P600, is up 143.5% 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. That will again be an attribute to monitor in coming months if the stock market moves bearishly by significant amounts. Such bearishness is unlikely based on current configurations. Historical standards and political climate support continued bullishness during 2011.

The NASDAQ is down 47.5% since its last weekly secular peak on March 9, 2000. The S&P500 is down 17.7% since its similar secular peak on March 23, 2000. The Dow is down by 1.2% 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.

The NASDAQ year-to-date performance was bearish by 21.1% through this week in 2001. The NASDAQ finished 2001 down by 21.4%, which was congruent with standards of post-election-year-bearishness.

The NASDAQ was down by 31.5% 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 NASDAQ stock market bear cycle found bottom in October 2002, which was consistent with the mid-term year’s historical standards of finding bottoms in mid-term election years.

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

It was up 1.4% on this weekend in 2005’s post election year, which was consistent with historical standards of losses and/or minimal gains. This was an excellent year, based on post election year historical standards of bearishness. Many of you recall that 2004 and 2005 were meandering bear markets.

In 2006, the NASDAQ was up 9.5% on this weekend, which again maintained congruency of historical bullishness for a mid-term election year. It was up by 9.8% at this time in 2007, which was consistent with pre-election year bullishness. The stock market peaked in 2007 from the 2003 bull leg after democrats took control of Congress in early. George W. went along with them as opposed to repelling them. That accelerated the bear and added depth to its decline.

The NASDAQ was down by 40.5% on this weekend in 2008. That was extreme contrarian performance to the standards of historical election year bullishness. It was the most bearish presidential election year since related records from 1832.

The NASDAQ was up 43.9% at this time last year in extreme contrarian performance to historical standards. Keep in mind, this extraordinary bullish cycle in 2009 finished that year down by 20.6% from its prior Mid-term cyclical peak on October 31, 2007. Historians will view that extraordinary bullishness as a mere spurt (reverberation) from 2008’s severe bear market. The 2008 bear market more accurately reflected economic fundamentals than the 2009 bull market. Much of the 2009 bull market correlated well with declining political popularity.

Political behavior is favoring the stock market bull with pressure to reduce government waste. Anticipating that is bullish.

The Dow was up 18.8% on this weekend last year. Although post election years are generally bearish, the Dow’s gain for 2009 was slightly below the average gain during years with post-election-year bullishness.

The Dow is down 18.3% since its last weekly closing peak on Oct 9, 2007. The NASDAQ is down 7.2% since its last peak on Oct 31, 2007. The S&P500 is down 19.6% since its Oct 9, 2007 peak. The S&P600-small cap index is down 6.6% 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.

Interestingly, the NAS100 is the closest to returning to pre-crash highs. It is down by only 0.9% since its Oct 31, 2007 peak. The S&P400 is next. It is down by only 2.0% since its Jul 13, 2007 peak. It will be interesting if these indices can top those peaks. The Nov 14, 2010’s weekly report discussed this phenomenon. However, there was no bearish spurt, as the stock market continued with bullish behavior since then. You should notice, though, the major indices are struggling a bit to eclipse their all time highs.

The Dow is up 76.8% since March 9, 2009, which is the “bottoming” pivot date from the great bear market of 2007/8. The NASDAQ is up 109.1% and the S&P500 is up 85.9% since then. The S&P600, Small Cap Index, is up 128.7% since March 9, 2009. That March 2009-January 2010 bull leg was indeed powerful, but such cycles have occurred many times in the past only to be followed by bear cycles of varying breadth and depth. The Mid-term Indicant and Short-term Indicant are no longer suggesting impending bearishness, other than a potential bearish spurt.

The current bull cycle is believed to be the classical mid-term election year bullish starting point ahead of the presidential pre-election year. The pre-election year is the most bullish along the 4-year cycle. In essence, the firing of incumbent politicians in the U.S. always arouses the bull.

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.

The 3-month T-Bill remains flat and depressed, along with short-term CD’s. The 2012 forecasted values do not yet indicate any significant increases. Keep in mind these forecasts are purely statistical, but qualitative inquiries are not suggesting different projections at this time. However, the 6-month CD yield increased significantly four weeks ago, suggesting longer-term upward pressures. Even with this new development, it remains depressed. Anyone buying a 6-month CD at 0.41% with 2+% CPI is heading to the poor house unless deflationary pressures manifest. At any rate, all CD’s remain as Yellow Bears.

The Euro remains neutral with weakening trend and weakening mid-term cycle. This behavior tracks more closely to its long-term cyclical decline. The Canadian dollar, like the Yen, has been stable the past several weeks. Its cyclical direction and trend remain bullish. The CA$ tends to parallel oil prices, but the forecast for the CA$ continues with projected weakening. Although the Japanese Yen weakened in three of the past five weeks, its trend and mid-term cycle strengthening trend remains in tact. It strengthened significantly last week.

Overall, the US dollar strengthened the past four weeks; not because it is strong, but more or less displaying political stupidity/arrogance is not limited to the United States. Europeans may have a leg up on that. Politicians all over the world express royalty like behavior, sucking resources from the productive for their ever-expanding comfort zones. At some point, critical economic mass will be achieved and the economic books will require several new chapters. The wrong doers will be referred to as non-productive, self-proclaimed intellectual elites.

Scrolling down a bit on the aforementioned webpage, you will find the Reuter’s UK Commodities Index continues moving north since early 2009. It is a Red Bull. It continues to skyrocket, setting a new all time high during the week of November 8, 2010. It remains economically bullish with inflationary considerations later. The CRB Bridge Futures continues its shift from waffling to more bullish aggression. It is also a solid Red Bull.

Commodities, overall, discontinued behavior consistent with uncertainty in favor of outright bullishness. “Extract baby extract” is the evolving theme.

Mortgage rates reversed their bearish cycle of the past several weeks. They are holding in their recent bullishness. Their northerly movement is aggressive, but against trend and cyclical behavior. A few approached Red Bull status. This is the first Red Curve interaction since late 2008. It will be interesting to see if that holds.

The consumer price index and producer price index continue to be relatively stable.

Overall, hard economic data is stabilizing, albeit with increasing commodity prices. That is non-bearish, but lending support to longer-term inflationary potential. At some point, the U.S. Congress will learn they have no influence China and India manage their economies; both of which will enjoy larger economies than the U.S. at some point. If they retain a penchant for capitalism, rest assured prices for all commodities will escalate. However, the rising productivity associated with capitalists could dampen the effects on consumers. These economic shifts are unparalleled in the annals of history.

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 again signaled buy on Sep 17, 2010. It is up 17.1%, annualizing at 58.5% since then. It was solidly bullish the past two weeks.

Fidelity Gold, Fund #28 received a buy signal on Sep 4, 2009. It is up 27.1% since then, annualizing at 20.2%. This lazy fund was solidly bullish last week.

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. The Mid-term Indicant signaled buy on Sep 17, 2010 following a couple of buy/sell cycles since late 2008. It is up 17.5%, annualized at 60.1% since the more recent buy signal.

Fidelity Energy Services #40, FSESX, was up 107.2% since the Mid-term Indicant signaled buy on December 6, 2003 until the next sell signal on October 3, 2008. The Mid-term Indicant signaled buy on Sep 17, 2010, following a couple of buy/sell cycles since late 2008. It is up 32.8%, annualized at 112.6%, since the most recent buy signal. This was solidly bullish the past two weeks.

The Quick-term and Near-term Indicant signaled, buy, for ETF#03 – Energy and Natural Resources on Sep 15, 2010. It is up 26.0% since then, annualizing at 87.5%. It was up 242.4% (annualized at 44.8%) since the 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 72.0% since that buy signal, annualizing at 34.6%. 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 27.1%. The Near-term Indicant signaled buy on April 24, 2009 and it gained 17.3% until its sell signal on Feb 4, 2010. It received a sell signal from the Near-term Indicant on Jul 27, 2010, but received a new buy signal on Aug 9, 2010. It is up 18.2% since that buy signal, annualizing at 45.4%. The near-term model lost an opportunity of about 2% between Jul 27 and Aug 9, 2010.

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

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

All Mid-term attributes are solidly bearish.

All the major indices are up by an average of 22.3% since their bull signals an average of 38.6-weeks ago. That annualizes at 30.0%.

The Mid-term Indicant Dow Jones Industrial Average performance is at $30,363,608. That beats buy and hold performance of $1,761,374 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $148,628. That beats buy and hold’s $123,189 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $226,914. That beats buy and hold’s $91,986 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1623.9%, 20.7%, and 146.7%, respectively, for these indices as of this past week.

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.

Click here for the Mid-term Table of Mutual Funds.

The Mid-term Indicant signaled sell for MF#22-ProFunds Ultra Short on April 3, 2009. It is down 72.8% since then. It will receive a buy signal only if the Quick-term Indicant signals buy for QID, which occurred last August, but quickly endured “fluttering” behavior, followed by bearish aggression. A sell signal quickly ensued. That fluttering prevented the buy signal for MF#22.

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 300.0% (annualized at 15.6%) since the Long-term Indicant signaled bull 1,000-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, including relative performance 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.

Influencing parameters in the LTI include prior bull cycles. The great bull market in the 1990’s was powerful enough to offset the 2008-2009 recessionary bear market in this long-term modeling.

The Short-term Indicant Stock Market Report

Short-term Indicant Stock Market Report - Summary

As stated the past several days, “all Short-term attributes support the stock market bull. VIX is interesting, though. It is due for some bullish mischievous, but it is possible for it to perform with non-contrarian configurations for short-periods. In other words, it can move bullishly with stock market bullishness for a short-period. That suggest any VIX bullishness would be limited in magnitude.”

VIX call option premiums and call/put ratio suggests excessive optimism on its bullish bouncing. Some of you may have noticed calls declining in value on last Thursday’s mild VIX bullishness. The premiums were just too expensive. Short-termers are usually wrong, offering an added source of distrusting a solid and wild bullish bounce for the VIX. So far, that has occurred.

The stock market bull is somewhat lazy at this time, but the bear remains depressed.

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

The Near-term Indicant signaled no new bulls and no new bears. Click this sentence to see table leading to the charts.

The Short-term Indicant is signaling bull for all eleven non-contrarian indices. These bulls are up 10.7% since the NTI signaled bull an average of 11.8-weeks ago. That annualizes to 47.1%. The lone bear is contrarian VIX. It is down 18.3% since its bear signal 15.1-weeks ago.

The Quick-term Indicant signaled bear for contrarian VIX on Sep 16, 2010. It is down 18.3% since that bear signal.

The Quick-term Indicant is signaling bull for all eleven major non-contrarian indices. The eleven major indices are up by an average of 12.5% since the bull signal an average of 15.8-weeks ago, annualizing at 41.2%.

Short-term Market Summary

Nothing new here: Force Vectors remain in bullish domains, supporting the bull. Eleven QTI Red Bulls mitigate stock market bearish sustainability. Eleven NTI Blue bulls add bullish support. Any bearish behavior should be viewed as a mere spurt; no sustainability. As long as prices remain above NTI Bullish Blue, the bear will continue with its depression and impotence.

The bull continues gaining stock market breadth, adding bullish propulsion. The VIX is adding Force, but not yet threatening. The expected VIX bounce occurred last Fri/Mon. It was up over two points on those two days, but down last Tue/Wed. It was up mildly this past Thu/Fri. Force crossed above Pressure last Tue and into bullish domains last Wed, offering potential additional bullishness for the VIX. The VIX can enjoy a bullish spurt in non-contrarian nature.

All stock market attributes remain bullish, but not excitingly so.

Indicant Volume Indicators

Both volume indicators are falling at already low volume depths. Much of this recent decline is due to holiday volume. Historical seasonal standards suggests bullishness, while volume indicates hesitancy to do so. However, this has been a low volume bull since inception in May 2009. Current configurations continue suggesting this low volume will continue with the occasional and normal bearish spurts intervening from time to time.

Dec 31, 2010-Fri-Volume remains at holiday levels. Normalcy will occur next week. Those vacationing will not know what to do, as the bull is lazy and the bear has no spirit.

Dec 30, 2010-Thu-Volume remains at holiday levels. Bullish bias prevails.

Dec 29, 2010-Wed-Volume remains non-descriptive. That should change next week.

Dec 28, 2010-Tue-Holiday volume persists, except for the gold chasing. Regardless, though, bullish bias prevails.

Dec 27, 2010-Mon-Extremely low “holiday/blizzard” volume on flat stock market behavior retains 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 13.9% since their buy signals an average of 15.6-weeks ago. This annualizes at 46.5%.

The NTI is avoiding three ETF’s. They are down by an average of 28.9% since their sell signals an average of 14.6-weeks ago. They are contrarians, QID, VXX, and TLT.

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 18.0% since their buy signals an average of 23.0-weeks ago. This annualizes at 40.6%.

The Quick-term Indicant is avoiding 3-ETF’s (QID, VXX, TLT). They are all contrarian ETF’s. They are down by an average of 39.0% since their sell signals an average of 37.2-weeks ago.

Short-term Summary: There are 28-Red Bulls, mitigating dynamic and sustainable bearish behavior. The 29-NTI Blue Bulls add bullish support. Force is flattening to mild dipping, but not yet threatening to hold positions. Although not necessarily inspiring to the bull, it is equally uninspiring to the bear.

Contrarian Funds

ETF#03-Natural Resources. The Near-term and Quick-term Indicant signaled buy on Sep 15, 2010. It is up 26.0%, annualizing at 87.5%, since then. This ETF remains with Red Bull status, mitigating sustainable bearish threats. The “energy bear” cannot find sustainable forces with current bullish attributes.

ETF#11-Gold and Precious Metals is up 72.0% since the QTI signaled buy on December 11, 2008. Annualized growth is at 34.6%. Bearish yellow is a good price to set stop losses for a longer-term hold position, which is at $120.51 and still rising.

The Near-term Indicant signaled buy on Aug 9, 2010. It is up 18.2% since the Near-term buy signal, annualizing at 45.4%.

Pressure remains in bullish domains and no sell signal can be considered with that attribute. Force and Pressure are key attributes to monitor with Force climbing into bullish domains last Wed. Price interaction with Green always provides some excitement, but aggressive bullishness this past week suggests delays to such excitement. This ETF is adding fuel to its bullish attributes.

Click this sentence for additional charting and current forecasting of the actual price of gold.

As stated since late 2008, 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 advise of that potential when it occurs. Keep in mind, currencies can be manipulated for a period. However, currencies decoupled from production and related productivity will endure inflation regardless of political witch doctoring oratories. With that, in terms of U.S. dollars, gold’s long-term trend remains bullish. Some are claiming a Gold bubble. That is a mere marketing tactic..attention getting stuff. The Short-term Indicant does not care about bubbles. It signals sell/avoid before the bubble pops.

ETF#14-TLT-Long Government received a sell signal from Quick-term Indicant on Nov 15, 2010, as price fell below QTI-Yellow. It is up 0.7% that sell signal. It is a Yellow Bear, which offers no bullish support. It is vacillating around QTI Bearish Yellow, offering some hope for its rebound.

The Near-term Indicant signaled sell on Oct 14, 2010. It is down 6.7% since then. Force Vector climbed into bullish domains last Friday. That should invigorate the TLT Bear, even though that is normally inspirational to the bull. It was solidly bullish last Wed and this past Friday, following bearish aggression last Tuesday.

The Near-term Indicant and Quick-term Indicant signaled sell for ETF#31-QID on Sep 13, 2010. It is down 27.1% since then. Force climbed above Pressure, which is so low, no short bull can manifest. Without a reverse split, this ETF appears to be in search of single digit status. It is currently at $11.56. Force is attempting to climb into bullish domains, but encountering resistance to do so.

The Near-term Indicant signaled sell on Sep 2, 2010 for ETF#32-VXX. It is down 53.1% since then. Force continues hovering above low pressure, which supports continued bearishness for this ETN.

Major ETF Events

Dec 31, 2010-Fri-GLD returned to NTI Blue Bull status on bullish aggressions this past week.

Dec 30, 2010-Thu-None

Dec 29, 2010-Wed-None

Dec 28, 2010-Tue-GLD was up over 2% and TLT down over 2% today. The former appears to be adding to its already bullish momentum, while the latter is doing same for its bearish ambition.

Dec 23, 2010-Mon-None

Current Strategy-Short-term Indicant- Dec 31, 2010-Fri-Holding remains safe. All Short-term attributes support continued bullishness. Force is a bit threatening, but mildly so.

What follows remains unchanged. It was moved to the bottom of the daily report. It will be relocated near the top of the report with any change in verbiage.

-Tangential Protection – None!

-Reverse Tangential Bearish Detection – This phenomenon will continue to be monitored, but its threat has subsided for the time being. The timing is unknown, but there is 100% confidence the major indices and ETF’s will eventually fall to those prices noted in the below link. This is being threatened by explosive Asian economies and the classical pre-election presidential year’s stock market bullishness, which starts on January 1, 2011. Those historical bullish cycles typically originate in the mid-term election year, which concludes on December 31, 2010. Configurations suggest this bullish cycle has started and prices will not fall to those reverse tangential projections until a later date. Those sour values will most likely occur once hyper-inflation and/or high interest rates and/or both kick in, which is inevitable, but that could be a few years from now. So, until then enjoy the bull in spite of its sometimes illogical behavior.

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.

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 stock market endured bearish divergence last week, following combined bullish convergence/divergence in the prior five weeks. Any bearish behavior should be viewed as a mere spurt.

Indicant Conclusion

The presidential pre-election year stock market bullishness remains in tact. It is gaining some gusto. Technical support is not waning. The Indicant Volume Indicator is again depressed due to recent holiday volume. Volume should increase in coming weeks and months, offering additional obviations of directional intensity.

As stated the past 65-weeks, low interest rates impose narrowed alternative investment opportunities. That narrowed alternative suggests more demand for common stocks. Worldly events may be adjusting in support of the original premise; that is, where else can one put their money to work? The stock market, of course! The stock market bull continues expressing support for this principle.

Political phenomena, coupled with low interest rates, continue in support of the bull. Inflation has not yet threatened the bull. Keep in mind, though, it will at some point in the future.

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

01/02/2011