July 2007 Indicant Weekly Stock Market Reports

July 29, 2007 Indicant Weekly Stock Market Report

Volume 07, Issue 05 ISSN 1526 6516 © The Indicant Stock Market Report

The Bullish Bias Threatened

The Short-term Indicant signaled bear last week. There were several ETF sell signals by the Quick-term Indicant and a few by the Short-term Indicant. The Consolidated Quick/Short Indicant also generated a few sell signals. These events did not occur with the bear scare in late February and March earlier this year.

Some of the ETF’s are configuring with ominous bearish attributes. Look at ETF#05-Financial Institutions. You will notice this fund is falling prey to a collapsing Force Vector. Click the following link to view this unhealthy ETF.

http://www.indicant.net/Members/Updates/QTI-ETF-Charts/QTI-ETF1-Charts.htm#5

You will notice it had a similar Force Vector drop last March. However, that decay was not accompanied by a fall below its bearish yellow curve. There is a high probability of bearish sustainability when Force Vectors move robustly to the south into bearish domains and the underlying security is below its bearish yellow curve.

The above is not the only ETF with that configuration. The bear scare in late February and early March this year did not fool the Quick-term Indicant. There were only two sell signals at that time and they were quickly followed by another buy signal. After those buy signals, the market moved solidly to the north. However, this time, the configurations are favoring bearish influences on a quick-term basis.

This particular fund, ETF#05-Financials, is enduring fundamental problems with the threat of massive defaults on sub-prime loans. This fundamental weakness is further exacerbated by the perceived boom/bust cycle in real estate. The contemporary weight is assigned to the bust part of that cycle. Click the following link to see ETF#17-Real Estate.

http://www.indicant.net/Members/Updates/QTI-ETF-Charts/QTI-ETF3-Charts.htm#13

As you can see, it is moving aggressively south below its bearish yellow curve. It is down 11.9% since the Quick-term Indicant signaled sell on June 12, 2007. With Force Vectors moving rapidly to the south and no bearish yellow curve below its price, there is no defined pause point to slow or stop its collapse.

The stock market is funded, in part, from home equity loans. In other words, investors refinance their homes and assign much of the capital from their re-financing to the stock market. That propels demand for stocks disproportionate to the supply of stocks, which fosters bullish stock market behavior. The bear is excited about the possibility of loan defaults and a corresponding rapid decline in stock market cash infusions.

The second quarter reports highlighted a healthy economy. That depressed the stock market last week. Fundamentals, such as the above, coupled with economic robustness suggests the Federal Reserve is now more likely to increase interest rates. This is especially bad news to the small cap companies, where borrowing is required for rapid growth.

The worsen matters, oil prices skyrocketed last week. That suggests inflationary threats will increase and with that, expect rising interest rates.

All of this led to the second consecutive week of bearish convergence. Bearish sustainability typically occurs after four consecutive weeks of bearish convergence. Energy, precious metals, stock market, real estate, etc. all endured aggressive bearish behavior last week. Bearish convergence suggests the market is sniffing recessionary threats and thus its bearish behavior last week.

The bear is hoping for two more weeks of bearish convergence. That would zap remaining bullish energy. The bear would then find easy victories.

However, keep in mind, this is a presidential pre-election year, which is the most bullish on the four year cycle. Historical standards suggest the market will be up this year. Since it is already up, it is possible to endure sustainable bearish behavior as we approach deep bearish seasonality, which is due in a few weeks. Historical standards can exert its bullish influence after deep bearish seasonality and the impending heart and soul of bullish seasonality that always follows. So, it is possible for the market to fall precipitously and be followed by dynamic bullishness. The trick is to avoid the precipitous decline in stock market equities.

So, is this a bearish spurt? Current configurations support increased bearish influences over the next few weeks, but also support bullish responses. The overall effect could be a significant dip to the south, while the historical standard or presidential pre-election year bullishness will remain in tact. Keep your eye on the daily stock market report.

Weekly Buy/Sell Summary – Stocks and Funds

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

The Mid-term Indicant generated three buy signals and 26-sell signals.

In addition to the sell signals, the Mid-term Indicant is avoiding 33-stocks and funds of the 345- tracked by the Indicant. The avoided stocks and funds are down an average of 18.9% since the Mid-term Indicant signaled sell an average of 31.7-weeks ago.

There were 171-stocks and funds avoided at this time last year. Those avoided stocks and funds were down an average of 4.2% since their respective sell signals an average of 15.0-weeks earlier.

Two years ago, on July 29, 2005, the Mid-term Indicant was avoiding 91-stocks and funds that were down an average of 4.2% since their respective sell signals an average of 18.9-weeks earlier. Three years ago on July 30, 2004 there were 129-avoided stocks and funds. They were down by an average of 13.6% from their respective sell signals an average of 21.8-weeks earlier. On July 26, 2003, the Mid-term Indicant was avoiding only 16-stocks and funds out of 296-tracked at that time. They were down by an average of 29.1% since their sell signals an average of 30.2-weeks earlier. Five years ago on July 27, 2002, there were 255-avoided stocks and funds. They were down an average of 29.0% since their respective sell signals an average of 10.9-weeks earlier.

In addition to the buy signals, the Mid-term Indicant is signaling hold for 283 of the 345-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 140.1%. That annualizes to 62.2%. The Mid-term Indicant has been signaling hold for these 283-stocks and funds for an average of 117.0-weeks.

One year ago, on July 28, 2006, the Mid-term Indicant was holding 168-stocks and funds out of the 345 tracked for an average of 119.0-weeks. Those 168-stocks and funds were up by an average of 151.8% (annualized at 66.3%). The Mid-term Indicant was signaling hold for 224-stocks and funds of the 320-tracked two years ago on July 29, 2005. They were up by an average of 105.0% (annualized at 61.3%) since their respective buy signals an average of 89.1-weeks earlier. There were 165-stocks and funds with hold signals on July 30, 2004 since their buy signals an average of 62.2-weeks earlier. They were up by an average of 82.9% (annualized at 68.3%).

The Indicant was only tracking 296-stocks and funds in 2002-2003, and early 2004. On July 26, 2003, the Mid-term Indicant was signaling hold for 265-stocks and funds out of 296-tracked. They were up by an average of 46.2% (annualized at 92.9%) since their buy signals an average of 25.9-weeks earlier. Five years ago, on July 27, 2002, there were only 24-hold signals for stocks and funds out of the 295 tracked by the Mid-term Indicant. They were up 54.0% (annualized at 57.3%) since their respective buy signals an average of 49.0-weeks earlier.

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

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

http://www.indicant.net/Members/Updates/All%20Update%20Forms/Buy-Sell%20Summary%20This%20Week.htm

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.

All updated information can be found from a single page at Indicant.Net. Click the below link to that page. You will need your login ID and password.

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

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained on the website for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is imbedded in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months.

The Daily Indicant Stock Market Report for the last trading day of the current week is near the conclusion of this weekly stock market report. It is emailed each weekend, separately, so you can read it, either as a separate document, or in this document.

The Indicant Stock Market Report’s Secular Market Blend

The Dow is up 82.1% since it secular low on October 9, 2002. The NASDAQ is up 130.0% and S&P500 up 87.8%. The small cap index, S&P600, is up 140.2%. The NASDAQ is down 49.2% since it last weekly secular peak on March 9, 2000. The S&P500 is down 4.5% since it last weekly secular peak on March 23, 2000, while the Dow is up 13.2% since January 13, 2000. The NASDAQ needs to climb another 97.0% to achieve a new record high.

The Dow is up 6.4% so far this year. The S&P500 is up 2.9% and the NASDAQ up 6.1%. At this time last year, the Dow was up 3.6% for 2006, with the S&P500 up 1.2% and the NASDAQ down 6.8%. Even with last week’s bearish behavior, the major indices are performing better this year than last year.

With the exception of 2003, the last presidential pre-election year, the major indices are performing better this year than any year this century. The NASDAQ through this week of 2001 was down 17.9%. It was down a whopping 35.3% through this week of 2002. It recovered by 29.3% by this weekend of 2003. It was again down 6.7% in 2004 on this weekend. At this time of year in 2005, it was flat for the year and last year it was again down 6.8%. This year, it is up 6.1%.

Since the expiration of the heart and soul of bullish seasonality in late January 2007, the Dow is 5.1%, while the NASDAQ and S&P500 are up 4.0% and 1.4%, respectively. Even with last week’s bearish behavior, all the major indices are up since the expiration of the heart and soul of bullish seasonality.

Where is the market headed for the remainder of this year? Please read on and keep up with the Daily Stock Market Report.

Stop Loss Management

The Mid-term Indicant recommends a stop loss of 8% on recent buys because of the Quick-term Indicant’s bullish bias.

Use a 10% trailing stop loss or the yellow or green values you will find on the tables for your longer-term hold positions. If your stock or fund is above the bearish yellow curve and below the green curve, set your stop loss equal to the greater of the yellow curve and the trailing stop loss. If your stock or fund is above the green curve, set your stop loss at no less the value of the green curve or 10% trailing, whichever is greater. If your stock or fund is above the red curve and you bought at the Mid-term Buy signal, you should use the 10% trailing stop loss.

If you are up by triple digit amounts and enjoy your ownership of the stock or fund, then use a 20% trailing stop loss or the slow moving blue curve price. If you really enjoy holding the stock, keep a close eye on the management. Dilettante managers have a way of worming into the business. Watch closely for cronyism and lazy-hazy management dialog. Keep your eye on lavish spending and excessive concerns about social issues. Those types are more interested in burning your money for their pleasures, as opposed to making you money. High performing companies remain focused on honoring the investments made by their shareholders.

In a few instances, you will see a hold signal for a stock or fund that is down from its buy signal or below one of the above conditions for selling. If you are more of a trader than an investor, feel free to buy stocks and funds with those “bearish” attributes. They are configured for a possible rebound, while at the same time, it is important to set the stop losses mentioned in this report. Use the Quick-term Indicant as a guide in your decision-making processes. If the stock price is falling in a Quick-term Bear market, it is not advisable to buy.

Do not short on stocks if they are up from an avoid signal. Stocks go up more often than they go down. Stocks have a tendency to march to their own drumbeat when rising. Some stocks rise and continue to rise in the most severe of bear markets. Short selling opens up an opportunity for the snakes on Wall Street to take everything you own. They can cause a stock to rise at their whim and without any regard to fundamental reason. It usually does not make sense to bet against the sweat and toil of hard-working people.

Stock and Fund Update

Click the following link to see sorted performance of stocks and funds with hold/avoid signals. In the past, they were included in this email message but now display them on the website. This is available to the public, while the specific buy and sell transactions are limited to members only. The below table is public information and not updated on a frequent basis.

http://www.indicant.net/Non-Members/Performance/Top-Bot.htm

Economic Conditions – Inflation, Currency, Interest Rates

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

The 3-Month T-Bill continued moved solidly to the south last week after a few weeks of moving north. Its southerly movement paralleled the stock market’s dip to the south, but unfortunately, not as dramatic. The stock market needs a dramatic drop in interest rates, while at the same time not feel threatened by inflation. That scenario is going to be difficult with rising oil prices.

As stated the past six weeks, it is unlikely interest rates will rise during this presidential pre-election year. Unfortunately, their flat configuration the past several months induces bearish spurts from time to time. Rising commodity prices are a thorn viewed by the bull and remain as a constant threat.

As stated the past eight weeks, the various Indicant attributes are configuring in support of the historical standards of presidential pre-election-year and election-year stock market bullishness. The Fed will opt in favor of economic activity in the presidential pre-election year underway and next year’s election year. However, in 2009’s post election year, the bear would find absolute resolve in over-taking the bull if the Fed’s action manifests a rapid inflationary spiral and followed by a rapid increase in rates to stifle the inflation.

As stated the past ten weeks, the Fed is “maintaining” prevailing rates. The problem is a tough one. Commodity prices continue to rise and the inflation battle is underway. Rising capitalism should invoke rising productivity. Will this productivity potential offset the inflationary threats of rising commodity prices?

As stated the past four weeks, the oil’s bearish yellow curve has shifted back to the north. Although its recent northerly cycle has not produced the same dramatic bearishness of the 1970’s, it consumed bullish energy from the stock market. If it resumes another cyclical rise, the result should be unfavorable to the stock market bull. Two bad results will manifest. Either inflation becomes more than a nuisance or interest rates rise or both. The bull will be weakened in the event either unfolds. Click the below link to view the oil charts.

http://www.indicant.net/Members/Updates/Economic/E03.htm

As stated last week, the CRB Bridge Futures is configuring similarly to oil. That configuration continues to threaten the bullish stock market bias. The Fed keeps a close eye on this barometer. Its chart is on the same link. Just scroll down a little to view it.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 is up 333.4% since the April 13, 2001 buy signal. Its annualized growth since that buy signal is 52.3%. It moved to the north in 29 of the past 41-weeks. This fund was solidly bearish last week after bearish expressions in the previous week.

Fidelity Gold, Fund #28, is up 39.3% since the Mid-term Indicant signaled buy on August 26, 2005. That annualizes to 20.2%. This fund was aggressively bearish last week after three consecutive weeks of solid bullish performance.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 289.9% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 57.8%.

Vanguard Energy #18, VGENX, is up 215.3% (annualized at 49.2%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 195.1% (annualized at 52.9%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 163.9% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 40.9%.

These energy related funds were solidly bearish last week, following bearishness in the previous week.

Investors in these funds are supporting a 1970’s type of market with high inflation and high oil prices. Energy and gold always do well during such times. Fundamentals appear to be shifting in favor of selling the above funds (09/10/06). Do not sell until the Mid-term Indicant signals sell. They continue to rebound and from time to time endure fluttering. As long as capitalism remains in vogue around the globe and alternative sources of energy continue to lag exponentially increasing demand, a long-term perspective on holding strategy is appropriate.

The SQI (Consolidated Short-term and Quick-term Indicant) model signaled buy for the GLD-ETF#11 on August 3, 2005. It is up 50.3% since then. It is annualized at 25.1%. This ETF has been bearish in six of the past eleven weeks. It was bearish last week, following three consecutive bullish weeks.

The SQI signaled buy for ETF#03 – Energy and Natural Resources on March 26, 2003. It is up 219.3% (annualized at 49.8%). This fund was also solidly bullish last week after three weeks of bullish behavior.

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

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

All ten major indices are bulls. They are up by an average of 27.0% since the Mid-term Indicant signaled bull an average of 106-weeks ago. That annualizes to 13.1%, which is down significantly from the past three years. This is due to the bear signals for the S&P400 and S&P600 Indexes on July 21, 2006, which had been receiving a bull signal since October 25, 2002. Those two indices endured some fluttering after the expiration of the tremendous bull leg that lasted nearly four years. A new bull leg is underway and may proceed just as vigorously for these two indices as the bull leg from October 2002 through July 2006, where the S&P400 and S&P600 increased by 66.3% and 79.3%, respectively.

Dynamic bullish statistics were also eliminated due to the Dow Transports bear signal and a new bull signal on January 19, 2007. The Dow Transports enjoyed a 23.1% gain from its March 21, 2003 bull signal until its bear signal on March 19, 2004. It fluttered with a new bull signal one week later on March 26, 2004 and enjoyed an 80.0%-gain until a new bear signal on December 22, 2006.

The Dow Utilities increased by 104.4% from its October 25, 2002 bull signal to the March 21, 2006 bear signal. After some fluttering, it received a new bull signal on June 2, 2006. Interestingly, the Dow Utilities was the best performing index since the October 25, 2002 Mid-term Indicant bullish bias shift. Utility stocks have been consistent high performers since the bull market’s birth on October 25, 2002.

The Mid-term Indicant Dow Jones Industrial Average performance is now at $40,184,288.

That beats buy and hold performance of $2,028,176 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $188,037. That beats buy and hold’s $142,908 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $214,385. That beats buy and hold’s $88,843 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1,881.4%, 31.8%, and 141.3%, 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 MTI-RYS 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 nearly 2,000% over the past 100+ years.

Click here to go to the current Mid-term Indicant assessment of the ten major indices.

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

Divergence versus Convergence

Bearish convergence occurred for two consecutive weeks. Nearly all sectors moved bearishly to the south. That is somewhat ominous for the stock market.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

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

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

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

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

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

Mid-term Indicant Positions - Indicant Selected Stocks

Click here to see Indicant Select Stock Report Card history.

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

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant continues avoiding ProFunds Ultra Short. It is down 34.4% since the Mid-term Indicant signaled sell on September 15, 2006. Historical norms of market cyclicality suggest the next buying opportunity for this fund may not occur until 2009.

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

Always 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 358.3% (annualized at 22.7%) since the Long-term Indicant signaled bull 821-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, and inflation have not been strong enough to signal bear since that bull signal. A link to the Long-term Indicant is below:

http://www.indicant.net/Members/Updates/LTI-Markets-DJIA/DJIA.htm

Quick/Short-term Indicant Stock Market Report - Summary

Quick-term Red Bulls: Nine of thirty; bullish bias remains, although weakening.

Quick-term Yellow Bears: Seven; non-bearish support continues, but being threatened.

Short-term/Quick-term Non-Bearishness: Countering sustainable bearish ambition.

Force Vectors: Shifting south, suggesting a pause in bullish behavior and increasing bearish threats.

Vector Pressure: Supportive of bullish bias.

Long-term Hold Positions: Solidly safe.

Current Quick-term Bias: Bullish

Overall Market Status: Bullish bias prevailing, but weakening.

Profit Potential from Naked Options: Increasing volatility is favorable.

Volume: Configurations remain in support of underlying bullish bias.

Comments from April 20, 2007

Both the NASDAQ and NYSE Indexes passed above their upper trading range limit. That means a new trading range is being established and is not an indication of immediate bias.

Force Vectors and Vector Pressure maintained bullish bias during the Greenspan/China bearishness that originated in late February and lasted for a few days in early March. Viewing the Indicant Volume Indicator charts (link is below) is a testament about how one should not engage trading behavior based on contemporary news. Only two ETF sell signals were generated from the late February-early March bearishness that was invoked by news and nothing substantive. The bullish bias that originated on August 15, 2006 prevails.

Quick-term/Short-term Indicant Stock Market Report Details

The Short-term Indicant signaled bear yesterday for both the Dow and NASDAQ when configurations shifted in favor of the bear on the immediate horizon.

Please read on. Click here to see the Short-term Indicant’s history.

Both Indicant Volume Indicator’s are configuring robustly. As stated last Wednesday, there is an increased probability in near-term bearish bias. Even though the Dow is down over 500-points since then, the underlying configuration continues to support the cyclical bullish bias. Both of the previous two sentences continue to hold true. Those two truths will not last long.

SQI Report Card (Consolidated Short/Quick), Status, and Charts

There were no buy signals and one sell signal. Although there were no buy signals, the SQI is signaling hold for 27-ETF’s. They are up 67.8% (annualized at 27.9%) since their respective buy signals an average of 125.3-weeks ago. In addition to the sell signal, the SQI is avoiding three ETF’s. They are down 3.0% since their sell signals an average of 3.5-weeks ago.

The SQI model is the one that most of you will prefer for your trading decisions. It generates fewer signals than the other two models and represents consistencies in the Quick-term and Short-term outlooks for the specific ETF’s. It also beats buy and hold on a regular basis, although there is only eight years of proof. The quality of that proof is high since this period includes a powerful bull and bear. The model sours a little during meandering markets with an excessive number of signals from time to time. Research toward perfecting continues.

Short-term Indicant Report Card, Status, and Charts

There were no buy signals and one sell signal. Although there were no buy signals, the Short-term Indicant is signaling hold for 26-ETF’s. They are up an average of 77.6% (annualized 32.9%) since the STI signaled, buy, an average of 121.5-weeks ago. In addition to the sell signal, there are two avoid signals. They are down 3.0% since their sell signals an average of 3.5-weeks ago.

The Short-term Indicant is more active in buying/selling than the Consolidated model. The Quick-term Indicant, which follows, is even more active.

Quick-term Report Card, Status, and Charts

There were no buy signals and three sell signals. Although there were no buy signals, the Quick-term Indicant is signaling hold for 21-ETF’s. They are up by an average of 21.9% (annualized at 20.4%) since the QTI signaled buy an average of 55.3-weeks ago. In addition to the sell signals, the Quick-term Indicant is avoiding six ETF’s. They are down by an average of 3.6% since their sell signals an average of 2.8-weeks ago.

The Quick-term Indicant is yet more active with buy and sell signals.

Conflicts Between the Short-term and Quick-term Indicants

There are six conflicts, whereby the Short-term Indicant and the Quick-term Indicant are in disagreement between hold and avoid status. The bias shift on August 15, 2006 remains in favor of the bull.

Quick-term Indicant Bull/Bear Health Report

Seven of the 30-ETF’s are below their bearish yellow curves. The average relative position of all thirty ETF’s is above bearish yellow by 3.9%. This remains configured in support of the market’s non-bearish posture. There is no longer minimal support for sustainable bearish assertions. However, this attribute is not configured with support for sustainable bearish behavior.

Nine ETF’s are above their respective bullish red curves. That is down by fourteen from six-trading days ago. This configuration supports the underlying bullish bias, although weakened. All thirty ETF average positions are 3.9% below their bullish red curves.

Bearish spurts occur from time to time. Until all non-contrarian funds fall below their bullish red curves, bearish expressions should be considered as mere spurts. From time to time, other attributes are required to confirm this prognosis.

At this time, configurations indicate bearish expressions in the immediate future will be mere spurt behavior. There is no indication of sustainable bearish behavior.

Short-term Indicant Bull/Bear Health Report for ETF’s

The above heading is linked to the Short-term Indicant table. This paragraph is repeated daily as a reminder of accurately interpreting the charts. By clicking the charts on the table you can review potential contact with the breakdown lines (bearish) and potential contact with breakout lines (bullish). It is extremely bearish when several ETF’s are contacting their respective breakdown lines. The breakdown lines are the yellow lines (bearish). The breakout lines are the red ones (bullish). Close proximity to breakout implies an increased probability of an actual breakout occurring. It is certainly bullish and you will want to be in a hold position for those few days a year when the breakout occurs. Conversely, significant contact with yellow (breakdown) suggests “avoid” positions are best.

None of the thirty ETF’s are contacting their breakout lines. As stated the past several months, the high concentration of breakout-contact since last August is solidly bullish. This repeated contact solidly supports the underlying bullish bias. Contact in sixty of the last eighty trading days remains supportive of bullish bias. Non-contact with the breakout lines the past three days suggests the bull is resting.

The average distance from breakout contact is 8.3%. This remains in support of the bullish bias.

One of the ETF’s is contacting its breakdown line. That is the first time this has configured since 2004. It is ETF #17-Real Estate. The average distance from the price and breakdown is 19.6%. This configuration provides tremendous non-bearish support, which has been the case since March 2003. There have been several bearish “spurts” since then with no sustainability or dynamic support. The probability of immediate contact remains low and thus a non-bearish bias is maintained on a short-term basis, except for those funds with noted contact.

ETF Force Vector Configurations

You can scan the Quick-term Indicant for Exchange Traded Funds table and click on the charts to observe Force Vector configurations. Scroll down each of the charts, where a quick link has been added to take you to the next series of Quick-term ETF charts. Use you back arrow on your browser to return to the previous page.

One of the thirty ETF Force Vectors continue toward bullish domains. As stated six trading days ago, Force Vectors are now decreasing, which suggests a pause in bullish expressions. The underlying bias remains bullish, however.

To understand potential financial opportunities, click here to learn to identify Robust Force Vectors. They are visible on the Quick-term Indicant charts.

ETF Force Vectors/Vector Pressure Crossings/Option Signals

Remember, the links contained herein are more visible when reading this on the website.

Click this sentence for Vector Pressure Option Signals. The signals are listed there. There were three put option buy signals after Friday’s close.

With Force Vectors and Vector Pressure moving south, consider bullish expressions as bullish spurts against a micro-bearish bias. As stated earlier this week, Force Vectors are moving robustly to the south favoring a bearish bias on a near term basis. The behavior on the re-bound will advise when this attribute expires. If Force Vectors move above the Indicant line into bullish domains, then bullish bias will again be dominant. If Force Vectors turn back to the south into bearish domains, put option opportunities will increase. Also, that configuration would support an increased probability of sustainability by the bear.

Seventeen ETF Vector Pressures are in bullish domains. As stated the past few days, the current configurations remain in support the Quick-term bullish bias shift from August 15, 2006, although favoring increasing bearish spurt activity. As stated the past few days, several Quick-term and Short-term attributes have weakened in favor of bearish behavior. However, keep in mind, overall configurations favor bullish bias.

It is common for bull/bear battles when Vector Pressure is being threatened from its support of the prevailing bias.

As long as this attribute holds above fifteen within confines of other Quick-term attributes, bearish expressions are mere spurts, where there is no sustainability. If and when it falls below fifteen, other attributes will be evaluated and the bias assessment will be adjusted accordingly.

This paragraph is repeated from June 26, 2007 daily stock market report. Depth is a relative term. For those of you who bought several months ago, holding until bearish yellow is achieved, will be accomplished with ease. For those of you who bought in the past few weeks may not prefer to wait for the victor of the bear/bull battle that typically occurs at the bearish yellow curve.

Make certain you sell naked options when the Force Vectors shift direction or within two days of the purchase, whichever occurs first. If you are unfamiliar with this, take the options tour.

Remember options trading is risky. Never offer “market prices.” Always bid low in hopes of an intraday contrarian movement to the underlying assumption of directional behavior. Always place day-orders, only. That keeps the floor folks out of your pocketbook. Do not despair if your order does not take. There are plenty of opportunities throughout the course of the year. Remember, stalking is the key to success here. Although not necessary for stock market success, those of you who have a gambling instinct will enjoy this. For those of you with a longer-term perspective, it does not hurt to see what the short-term folks are thinking. The Indicant indicates both perspectives.

Quick-term and Short-term Indicant Summary

The shift from bearish bias to bullish bias started on Tuesday, August 15, 2006 after maintaining a bearish bias from early February 2006 until August 15. The Quick-term and Short-term Indicant models continue suggesting a bullish bias.

Do not write covered call options while Vector Pressure is positive (bullish), which is the current configuration. Increasing volatility suggests the market is not ripe for the risk here.

The Quick-term Bull remains in tact.

ProFunds Ultra Short mutual fund moves inversely to the QQQQ by exponential amounts. The Consolidated Indicant model is no longer avoiding QQQQ, which no longer supports holding contrarian fund, ProFunds Ultra Short.

To familiarize yourself with viewing the market from an ETF perspective, click the following update links.

Quick-term ETF Options

Quick-term Indicant for ETF’s

Short-term Indicant for ETF’s

Consolidated Quick-term/Short-term Indicant for ETF’s

Click here to the report card, which is updated weekly, to link to related tours.

Links to the Short-term Indicant and Indicant Volume Indicator are below:

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

Indicant Conclusion

The market’s bearish behavior last week is most likely unsettling for quite a few of you. Some are asking, is this another bearish spurt or is this the beginning of a sustainable bearish cycle? The Quick-term Indicant remains configured with bullish attributes, although they are weakened.

Vector Pressure continues to support the bullish bias. It has been doing that since August 15, 2006. However, Vector Pressure is down quite a bit. Force Vectors have shifted robustly in favor of bearish support.

There are only 9-Red Bulls on a Quick-term basis, while there are seven ETF’s below the bearish yellow curve.

The Short-term Indicant signaled bear last week. This could be a sustainable bear until late September/early October.

Keep up with the daily stock market report as the Quick-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

In addition, 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

07/29/07

July 22, 2007 Indicant Weekly Stock Market Report

Volume 07, Issue 04 ISSN 1526 6516 © The Indicant Stock Market Report

This Week’s Report

The Bullish Bias Prevails – Part VI

Disappointing corporate earnings unleashed bearish behavior late last week. Many corporate management teams figure from time to time in their lazy-hazy methods that things are okay right now and maybe spend a little too much on their personal possessions/distractions. When earnings disappoint, they always pin-point the problem, such as supply chain issues, rising material costs, production disruptions, etc. Those are symptoms.

The real problem when earnings disappoint is one that you never hear. That is, corporate management fell asleep at the wheel. There are many instances of a lack of management focus. When earnings disappoint, Orangutan Management kicks in. That is one of the specialties of dilettante management. Problem recognition with outstanding sound-bites is their skill set. The stock market sees through the façade and punishes accordingly. Boardrooms operate more slowly since they are pals with the board. Only after the stock market punishes severely, the boardroom participants are displaced and the good old boy network is eventually disbanded.

The trick to Happy Investing is not wait on the board. They are immune to stockholder’s dissatisfaction well after the stock price has collapsed. You should never wait for any board of directors to take corrective action. Some do but they are slow; very slow. Most of them are concerned about their own well being; not yours. Thus the slowness of the displacement process. Many adopt, “can we make it one more quarter?” There are not too many 90-hour week managers around, such as Alfred P. Sloan anymore. Many feel great because they have learned how to garnish huge salaries, which is the problem. Paying hirelings over six digits is the root of the problem. Once you pay a hireling over a million to run an enterprise already in operation when he or she was hired will, with a few exceptions, result in mediocre performance.

The stock market knows all of this and punishes accordingly. Unfortunately, the immediate punishment is dished out to the shareholder; not those responsible for the disappointment.

However, do not despair at this time. The stock market does not consist entirely of those hirelings who do not earn their money with day-in and day-out hardworking performance. There are many who do perform; mostly in the small cap areas, which can encourage bullish trends to continue even though the S&P500 dilettantes impose a heavy lid on bullish performance.

Even though earnings were down last week, keep in mind the Dow is up 23.3% since that August 15, 2006 Quick-term Indicant bullish bias shift. The NASDAQ is up 27.1% since then. The S&P500 lags with a 19.3% growth rate. If corporate earnings continue to disappoint, keep your eye out for Orangutan management, where problem identification is openly announced. You, of course, are now aware that the root cause of the problem is not being addressed.

Although the causative factors of last week’s late bearishness was mostly due to corporate earnings, economic fundamentals continue supporting bullish bias. Most of the major indices finished the week on a mild bearish note. The S&P500 was one of the most bearish with a 1.2% decline, while the NASDAQ100 was up a paltry 0.2%. Even though last Friday’s bearish expression was discerning, this remains a bull market. Historical standards support that prognosis and more importantly the various Indicant models substantiate that.

Keep your eye on the daily stock market report, as we are nearing the seasonal period of deep bearish seasonality.

Weekly Buy/Sell Summary – Stocks and Funds

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

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

Although there were no sell signals, the Mid-term Indicant is avoiding 36-stocks and funds of the 345- tracked by the Indicant. The avoided stocks and funds are down an average of 6.3% since the Mid-term Indicant signaled sell an average of 29.3-weeks ago.

There were 164-stocks and funds avoided at this time last year. Those avoided stocks and funds were down an average of 7.4% since their respective sell signals an average of 15.1-weeks earlier.

Two years ago, on July 22, 2005, the Mid-term Indicant was avoiding 95-stocks and funds that were down an average of 6.0% since their respective sell signals an average of 17.3-weeks earlier. Three years ago on July 23, 2004 there were only 83-avoided stocks and funds. They were down by an average of 26.3% from their respective sell signals an average of 41.8-weeks earlier. On July 19, 2003, the Mid-term Indicant was avoiding only 13-stocks and funds out of 296-tracked at that time. They were down by an average of 28.1% since their sell signals an average of 29.6-weeks earlier. Five years ago on July 19, 2002, there were 241-avoided stocks and funds. They were down an average of 26.6% since their respective sell signals an average of 10.7-weeks earlier.

In addition to the buy signals, the Mid-term Indicant is signaling hold for 307 of the 345-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 144.8%. That annualizes to 66.6%. The Mid-term Indicant has been signaling hold for these 307-stocks and funds for an average of 113.1-weeks.

One year ago, on July 21, 2006, the Mid-term Indicant was holding 168-stocks and funds out of the 345 tracked for an average of 124.7-weeks. Those 168-stocks and funds were up by an average of 159.3% (annualized at 66.4%). The Mid-term Indicant was signaling hold for 222-stocks and funds of the 320-tracked two years ago on July 22, 2005. They were up by an average of 103.6% (annualized at 60.7%) since their respective buy signals an average of 88.7-weeks earlier. There were 166-stocks and funds with hold signals on July 23, 2004 since their buy signals an average of 62.2-weeks earlier. They were up by an average of 80.7% (annualized at 67.5%).

The Indicant was only tracking 296-stocks and funds in 2002-2003, and early 2004. On July 19, 2003, the Mid-term Indicant was signaling hold for 277-stocks and funds out of 296-tracked. They were up by an average of 44.4% (annualized at 93.2%) since their buy signals an average of 24.8-weeks earlier. Five years ago, on July 19, 2002, there were only 39-hold signals for stocks and funds out of the 294 tracked by the Mid-term Indicant. They were up 38.4% (annualized at 45.0%) since their respective buy signals an average of 44.4-weeks earlier.

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

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

http://www.indicant.net/Members/Updates/All%20Update%20Forms/Buy-Sell%20Summary%20This%20Week.htm

All updated information can be found from a single page at Indicant.Net. Click the below link to that page. You will need your login ID and password.

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

The Quick/Short-term Indicant Stock Market Report

The Indicant Stock Market Report’s Secular Market Blend

Stock market variation to bullish trend is minimal at this time. This section will resume when indications suggests the market is going to shift secularly. The data is being maintained by the Indicant. Please read back weekly issues from 2004 if you are interested in this content. Again, to keep members from be lulled to sleep with minor variation to trend, this section will contain this paragraph until such time details will be resumed.

Stop Loss Management

The Mid-term Indicant recommends a stop loss of 8% on recent buys because of the Quick-term Indicant’s bullish bias.

Stock and Fund Update

http://www.indicant.net/Non-Members/Performance/Top-Bot.htm

Economic Conditions – Inflation, Currency, Interest Rates

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

The 3-Month T-Bill continues moving mildly to the north. As stated the past few week, this increase in short-term interest rates did not discourage the bull from maintaining its dominance. Friday’s aggression by the bear was induced by poor corporate performance.

As stated the past five weeks, it is unlikely interest rates will rise during this presidential pre-election year. Unfortunately, their flat configuration the past several months induces bearish spurts from time to time. Rising commodity prices are a thorn viewed by the bull and remain as a constant threat.

As stated the past seven weeks, the various Indicant attributes are configuring in support of the historical standards of presidential pre-election-year and election-year stock market bullishness. The Fed will opt in favor of economic activity in the presidential pre-election year underway and next year’s election year. However, in 2009’s post election year, the bear would find absolute resolve in over-taking the bull if the Fed’s action manifests first a rapid inflationary spiral and then a rapid increase in rates to stifle the inflation.

As stated the past nine weeks, the Fed is “maintaining” prevailing rates. The problem is a tough one. Commodity prices continue to rise and the inflation battle is underway. Rising capitalism should invoke rising productivity. Will this productivity potential offset the inflationary threats of rising commodity prices?

As stated the past three weeks, the oil’s bearish yellow curve has shifted back to the north. Although its recent northerly cycle has not produced the same dramatic bearishness of the 1970’s, it consumed bullish energy from the stock market. If it resumes another cyclical rise, the result should be unfavorable to the stock market bull. Two bad results will manifest. Either inflation becomes more than a nuisance or interest rates rise or both. The bull will be weakened in the event either unfolds. Click the below link to view the oil charts.

http://www.indicant.net/Members/Updates/Economic/E03.htm

The CRB Bridge Futures is configuring similarly to oil. That configuration continues to threaten the bullish stock market bias. The Fed keeps a close eye on this barometer. Its chart is on the same link. Just scroll down a little to view it.

This paragraph is repeated from the past seven weeks. Productivity improvements are evolutionary, whereas commodity prices can be revolutionary. The sudden increase in the number of capitalists is revolutionary. However, it takes time and a lot of effort to increase productivity. The exponentially increased demand for commodities can out-pace the impending productivity increases and thus set off inflation. This is an issue confronting both the Fed and the stock market. The prevailing stock market perception is that productivity will be the economic savior.

Overall, economic conditions appear shifting in favor of a continuation of this strong bull market.

Last Friday’s bearish behavior was induced by poor corporate performance. Contemporary research suggests these problems relate more to operational incompetence as opposed to economic fundamentals.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 is up 380.4% since the April 13, 2001 buy signal. Its annualized growth since that buy signal is 59.8%. It moved to the north in 29 of the past 40-weeks. This fund was bearish last week after three weeks of solid bullish behavior.

Fidelity Gold, Fund #28, is up 50.4% since the Mid-term Indicant signaled buy on August 26, 2005. That annualizes to 26.2%. This fund was aggressively bullish the past three weeks.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 321.7% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 64.4%.

Vanguard Energy #18, VGENX, is up 238.7% (annualized at 54.8%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 206.3% (annualized at 52.6%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 181.7% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 45.0%.

These energy related funds were mostly bearish last week.

The SQI (Consolidated Short-term and Quick-term Indicant) model signaled buy for the GLD-ETF#11 on August 3, 2005. It is up 55.2% since then. It is annualized at 27.8%. This ETF has been bearish in five of the past ten weeks. It was bullish the past three weeks.

The SQI signaled buy for ETF#03 – Energy and Natural Resources on March 26, 2003. It is up 244.2% (annualized at 55.7%). This fund was also bullish the past three weeks.

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

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

All ten major indices are bulls. They are up by an average of 34.1% since the Mid-term Indicant signaled bull an average of 105-weeks ago. That annualizes to 17.0%, which is down significantly from the past three years. This is due to the bear signals for the S&P400 and S&P600 Indexes on July 21, 2006, which had been receiving a bull signal since October 25, 2002. Those two indices endured some fluttering after the expiration of the tremendous bull leg that lasted nearly four years. A new bull leg is underway and may proceed just as vigorously for these two indices as the bull leg from October 2002 through July 2006, where the S&P400 and S&P600 increased by 66.3% and 79.3%, respectively.

The Mid-term Indicant Dow Jones Industrial Average performance is now at $41,958,241.

That beats buy and hold performance of $2,117,269 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $198,074. That beats buy and hold’s $150,269 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $224,874. That beats buy and hold’s $93,190 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1,881.4%, 31.8%, and 141.3%, respectively, for these indices as of this past week.

Click here to go to the current Mid-term Indicant assessment of the ten major indices.

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

Divergence versus Convergence

Last week endured bearish convergence with most sectors moving south. This followed the prior week’s solid bullish convergence. The market finds it distasteful that management performance was substandard with last week’s corporate profits.

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 Mid-term Indicant Table of Mutual Funds.

Always 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 378.5% (annualized at 24.0%) since the Long-term Indicant signaled bull 820-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, and inflation have not been strong enough to signal bear since that bull signal. A link to the Long-term Indicant is below:

http://www.indicant.net/Members/Updates/LTI-Markets-DJIA/DJIA.htm

Quick/Short-term Indicant Stock Market Report - Summary

Quick-term Red Bulls: Eighteen of thirty; bullish bias remains, although weakening.

Quick-term Yellow Bears: Three; the market remains to near-maximum non-bearish support.

Short-term/Quick-term Non-Bearishness: Countering sustainable bearish ambition.

Force Vectors: Shifting south, suggesting a pause in bullish expressions.

Vector Pressure: Supportive of bullish bias.

Long-term Hold Positions: Solidly safe.

Current Quick-term Bias: Bullish

Overall Market Status: Bullish bias prevailing, but weakening.

Profit Potential from Naked Options: Increasing volatility is favorable.

Volume: Configurations remain in support of underlying bullish bias.

Comments from April 20, 2007

Both the NASDAQ and NYSE Indexes passed above their upper trading range limit. That means a new trading range is being established and is not an indication of immediate bias.

Quick-term/Short-term Indicant Stock Market Report Details

The Short-term Indicant signaled bull on May 21, 2007 for both the Dow and NASDAQ. They are up 2.3% and 4.2%, respectively, since then. Configurations continue supporting bullish.

Please read on. Click here to see the Short-term Indicant’s history.

Both Indicant Volume Indicator’s are now in the early stages of robust movement. Today’s increased volume supports that, but most of this robustness is supportive of bullish bias at this time. As stated for the past several months, configurations continue to support bullish bias.

SQI Report Card (Consolidated Short/Quick), Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the SQI is signaling hold for 28-ETF’s. They are up 77.5% (annualized at 32.6%) since their respective buy signals an average of 122.5-weeks ago. Although there were no sell signals, the SQI is avoiding two ETF’s. They are down 0.2% since their sell signals an average of 4.2-weeks ago.

Short-term Indicant Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Short-term Indicant is signaling hold for 28-ETF’s. They are up an average of 85.0% (annualized 36.7%) since the STI signaled, buy, an average of 119.2-weeks ago. Although there were no sell signals, there are two avoid signals. They are flat since their sell signals an average of 4.2-weeks ago.

The Short-term Indicant is more active in buying/selling than the Consolidated model. The Quick-term Indicant, which follows, is even more active.

Quick-term Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Quick-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 25.6% (annualized at 24.0%) since the QTI signaled buy an average of 54.9-weeks ago. Although there were no sell signals, the Quick-term Indicant is avoiding two ETF’s. They are down by an average of 2.1% since their sell signals an average of 6.9-weeks ago.

Conflicts Between the Short-term and Quick-term Indicants

There are no conflicts, whereby the Short-term Indicant and the Quick-term Indicant are in disagreement between hold and avoid status. The bias shift on August 15, 2006 remains in favor of the bull.

Quick-term Indicant Bull/Bear Health Report

Three of the 30-ETF’s are below their bearish yellow curves. The average relative position of all thirty ETF’s is above bearish yellow by 10.5%. This remains configured in support of the market’s non-bearish posture. There is minimal support for sustainable bearish assertions.

Eighteen ETF’s are above their respective bullish red curves. That is down by five from last Thursday. This configuration solidly supports the underlying bullish bias, although weakened. All thirty ETF average positions are 2.2% above their bullish red curves.

At this time, configurations indicate bearish expressions in the immediate future will be mere spurt behavior. There is no indication of sustainable bearish behavior.

Short-term Indicant Bull/Bear Health Report for ETF’s

The average distance from breakout contact is a meager 2.7%. This remains in support of the bullish bias.

None of the ETF’s are contacting their respective breakdown lines. The average distance from the price and breakdown is 29.1%. This configuration provides tremendous non-bearish support, which has been the case since March 2003. There have been several bearish “spurts” since then with no sustainability or dynamic support. The probability of immediate contact remains low and thus a non-bearish bias is maintained on a short-term basis.

This attribute remains solidly non-bearish, regardless of recent bearish behavior.

ETF Force Vector Configurations

Six of the thirty ETF Force Vectors continue toward bullish domains. As stated last Thursday, Force Vectors are now decreasing, which suggests a pause in bullish expressions. The underlying bias remains bullish.

To understand potential financial opportunities, click here to learn to identify Robust Force Vectors. They are visible on the Quick-term Indicant charts.

ETF Force Vectors/Vector Pressure Crossings/Option Signals

Remember, the links contained herein are more visible when reading this on the website.

Click this sentence for Vector Pressure Option Signals. There were no option signals.

Twenty-five ETF Vector Pressures are in bullish domains. The current configurations remain in support the Quick-term bullish bias shift from August 15, 2006, although favoring increasing bearish spurt activity. It is common for bull/bear battles when Vector Pressure is being threatened from its support of the prevailing bias.

Make certain you sell naked options when the Force Vectors shift direction or within two days of the purchase, whichever occurs first. If you are unfamiliar with this, take the options tour.

Quick-term and Short-term Indicant Summary

Do not write covered call options while Vector Pressure is positive (bullish), which is the current configuration.

The Quick-term Bull remains in tact.

To familiarize yourself with viewing the market from an ETF perspective, click the following update links.

Quick-term ETF Options

Quick-term Indicant for ETF’s

Short-term Indicant for ETF’s

Consolidated Quick-term/Short-term Indicant for ETF’s

Click here to the report card, which is updated weekly, to link to related tours.

Links to the Short-term Indicant and Indicant Volume Indicator are below:

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

Indicant Conclusion

All bull markets endure bearish spurts from time to time. Last Friday’s bearish behavior was induced by disappointing corporate earnings. Although this is a fundamental issue with the bull, it is not a time for panic selling. Management incompetence surfaces from time to time as many of them think times are good right now and more or less relax. Not too many of them worry about the long-term.

However, this should be considered as another bearish spurt until the various Indicant models suggest otherwise. Vector Pressure continues to support the bullish bias. It has been doing that since August 15, 2006.

Keep up with the daily stock market report as the Quick-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

In addition, 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

07/22/07

July 15, 2007 Indicant Weekly Stock Market Report

Volume 07, Issue 03 ISSN 1526 6516 © The Indicant Stock Market Report

This Week’s Report

The Bullish Bias Prevails – Part V

The stock market was volatile last week with the bull expressing more dominance than the bear. The bearish expressions were accompanied by more volume than the follow-on bullish responses. However, later in the week, bullish expressions were accompanied by yet higher volume. The bull was victorious and openly expressed its dominance in full support of the underlying bullish bias.

The sub-prime lending markets fostered bearish encouragement. Loan defaults excite the bear. Downgrading the sub-prime investment instruments provides the bear fuel for increasing energy in it unrelenting battle with the bull.

Short-term psychology suggests that the Fed will be forced to reduce interest rates to replace the economic stimulants now be vacated by home equity loans and related consumer spending, as well as investment potential. That is the reason for increased volume on bullish expressions; that is the belief the Fed will be pressured to bolster the economy with rate reductions in the face of increasing loan defaults. Mortgage lenders’ investors are demanding more interest premiums for their increasing investment risk in sub-prime markets.

Of course, this psychological impact will eventually be replaced by logical and rational conclusions. If the Fed is accommodating with rate reductions, the CPI may move unfavorably to the north. Most of the commodity prices, including oil, are not accommodating the idea of interest rate reductions. The Fed is constantly faced with finding the optimum point between economic health and inflation. That is a constant conflict. Rising commodity prices with a rate reduction may excite the CPI to unacceptable levels. The bear will act on rising rates, economic recession, or increased inflation. The bull cannot counter unfavorable behavior in those three areas.

However, the bull seldom needs much encouragement, as long as there is some steadiness in these economic dynamics. As long as capitalism continues to increase along with the corresponding increased productivity, the bull will continue to be armed enough to stave off bearish desires. However, an unfavorable blip on capitalistic influences or faltering productivity, the bull would expire in the face of increasing bearish pressure.

Keep your eye on the daily stock market report where technical reason anticipates fundamental cause.

Weekly Buy/Sell Summary – Stocks and Funds

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

In addition to the sell signal, the Mid-term Indicant is avoiding 37-stocks and funds of the 345- tracked by the Indicant. The avoided stocks and funds are down an average of 8.3% since the Mid-term Indicant signaled sell an average of 28.1-weeks ago.

There were 143-stocks and funds avoided at this time last year. Those avoided stocks and funds were down an average of 8.2% since their respective sell signals an average of 16.8-weeks earlier.

Two years ago, on July 15, 2005, the Mid-term Indicant was avoiding 97-stocks and funds that were down an average of 6.2% since their respective sell signals an average of 16.5-weeks earlier. Three years ago on July 16, 2004 there were only 50-avoided stocks and funds. They were down by an average of 29.2% from their respective sell signals an average of 45.0-weeks earlier. On July 12, 2003, the Mid-term Indicant was avoiding only 10-stocks and funds out of 296-tracked at that time. They were down by an average of 29.0% since their sell signals an average of 29.1-weeks earlier. Five years ago on July 12, 2002, there were 220-avoided stocks and funds. They were down an average of 26.6% since their respective sell signals an average of 10.7-weeks earlier.

Although there were no buy signals, the Mid-term Indicant is signaling hold for 307 of the 345-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 145.0%. That annualizes to 67.3%. The Mid-term Indicant has been signaling hold for these 307-stocks and funds for an average of 112.1-weeks.

One year ago, on July 14, 2006, the Mid-term Indicant was holding 177-stocks and funds out of the 345 tracked for an average of 120.7-weeks. Those 177-stocks and funds were up by an average of 156.0% (annualized at 67.2%). The Mid-term Indicant was signaling hold for 203-stocks and funds of the 320-tracked two years ago on July 15, 2005. They were up by an average of 107.9% (annualized at 59.8%) since their respective buy signals an average of 93.8-weeks earlier. There were 246-stocks and funds with hold signals on July 16, 2004 since their buy signals an average of 59.6-weeks earlier. They were up by an average of 79.1% (annualized at 69.0%).

The Indicant was only tracking 296-stocks and funds in 2002-2003, and early 2004. On July 12, 2003, the Mid-term Indicant was signaling hold for 278-stocks and funds out of 296-tracked. They were up by an average of 47.5% (annualized at 103.2%) since their buy signals an average of 23.9-weeks earlier. Five years ago, on July 12, 2002, there were only 50-hold signals for stocks and funds out of the 294 tracked by the Mid-term Indicant. They were up 40.3% (annualized at 46.6%) since their respective buy signals an average of 45.0-weeks earlier.

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

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

http://www.indicant.net/Members/Updates/All%20Update%20Forms/Buy-Sell%20Summary%20This%20Week.htm

All updated information can be found from a single page at Indicant.Net. Click the below link to that page. You will need your login ID and password.

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

The Quick/Short-term Indicant Stock Market Report

The Indicant Stock Market Report’s Secular Market Blend

This section is a repeated each week with a few modifications, reflecting recent secular influences and performance data. Although appearing redundant at times, it is important to read this section to keep abreast of secular market shifts. Quantifications and qualifications are updated, weekly. Remember, secular shifts can last twenty-five or more years. Fortunately, secular market movements do not deter mid-term, short-term, and quick-term profit opportunities. However, they can wreak havoc to the long-term investors’ plans and those that buy and hold.

The current Mid-term Bull market and buying barrage started in late 2002. The mid-term election year of 2002 conformed perfectly to historical standards with deep bearish expressions and a cyclical bottom. That contrasts to the meandering bear market from late January through mid-August 2006; the more recent mid-term election year.

Deep bearish seasonality was not influential in 2006, which usually occurs from late August through early October. Last August, the Quick-term Indicant obviated a bullish bias, contrary to the historical standards of deep bearish seasonality. Many buy signals occurred in late August - early September 2006, which was unusual for that time of year. Those buy signals matured into financially successful hold signals.

As earlier stated, the market synchronized with near perfection to normal seasonality in the mid-term election year of 2002. The rolling half of May-October 2002 was typically bearish. The 2002 seasonal bear leg was dynamic and configured perfectly to historical standards, although the depth of that bearish cycle was deeper than normal. That NASDAQ bear cycle approached the magnitude of the 1930-32 Dow bear cycle. The 2000-2002 NASDAQ bear leg lasted several weeks longer than the depression-laden 1930-32 Dow.

The mid-term election year of 2006 fundamentally supported historical standards for the first two thirds. Although mild bearishness exerted its historical influence in 2006, it was nowhere as deep as 2002’s bearishness. The meandering bear in the first two-thirds of 2006 supported the historical standard of bearishness to non-bullishness. That bearish support was mild.

As of mid-August 2006, hard economic fundamentals shifted in support of a bullish onslaught for the heart and soul of bullish seasonality and the normally bullish presidential pre-election year of 2007. Bullishness during the week of March 5, sandwiched between two bearish weeks (February 26 and March 12), provided some insight on bearish sustainability. The bullish bounce on the week of March 5 suggested the bearish aggressions were going to be mild and not sustainable. In other words, that bearish behavior was a mere bearish spurt. It was simply talking the market down by those who enjoy their influence and the one-dimensional media. Also, commission hungry brokers enjoy that sort of volatility and tend to jump on the bandwagon.

The heart and soul of bullish seasonality from mid-October 2005 through January 31, 2006 demonstrated bullish normalcy. The market was a meanderer from January 31, 2006 until mid-August 2006, when the Quick-term Indicant shifted from bearish to bullish bias.

The heart and soul of bullish seasonality, ending January 31, 2007, produced significant and expected gains since the August 15, 2006 bullish bias shift. The Dow, S&P500, and NASDAQ finished up by 12.4%, 11.9%, and 16.5% at the conclusion of that heart and soul of bullish seasonality cycle.

How has the market fared after the conclusion of the heart and soul of bullish seasonality? From January 31, 2002 through September 30, 2002, the Dow fell 23.5%. The NASDAQ was down 39.4%. The bull market of 2003 did not incur normal seasonality, as it conformed perfectly to the presidential pre-election year’s bullish phenomenon. So far, the presidential pre-election year of 2007 is mirror imaging the presidential pre-election year bullishness of 2003. There is more about that later.

From January 31, 2004 until September 30, 2004, the NASDAQ fell 8.2%, while the Dow was down 3.9%. From January 31, 2005 to June 30, 2005, the Dow was down 2.0% and the NASDAQ down 0.4%. From January 31, 2006 through August 1, 2006, the NASDAQ was flat while the Dow was up a respectable 6.1%.

From January 31, 2003 through September 30, 2003, the Dow was up 15.2%, while the NASDAQ was up 35.3%. The last presidential pre-election year was 2003. Presidential pre-election years are traditionally bullish. Post “heart and soul bullish seasonality” in the pre-election year of 2003 did not drag energy from the bull. So far in this presidential pre-election year, the Dow is up 10.2% since January 31, 2007 and the NASDAQ is up 9.9%.

Aggressive bearish expressions twenty weeks ago and again eighteen weeks ago pushed the major indices into negative territory, which can happen after the heart and soul of bullish seasonality expires. Those particular bearish expressions were mere spurts and lacked sustainability. The bearish expression during the week of June 3, 2007 and four weeks ago are configured as bearish spurts. Spurts occur from time to time as the crowd has fits of momentary influence on the market’s direction.

Historical standards suggest the market will go much higher this year. Political and economic fundamentals also support this prognosis.

As you can see, until mid-August 2006, most major market indices have been slightly bullish since late 2003 with pronounced meandering behavior. The only significant bullish expressions, not followed by bearish expressions, occurred in the heart and soul of bullish seasonality (Nov-Jan) in 2004, 2005, and 2006. Other than those “heart and soul” bullish cycles, the market was relatively flat from early 2004 through August 2006. However, this is a presidential pre-election year, where meandering to bearish behavior should not occur. The theme is bullish expectations even in the face of periodic bearish spurts.

The Dow30 found bottom in the last presidential mid-term election year on October 9, 2002 at 7,286.27. The NASDAQ found bottom on the same day at 1114.11. Finding cyclical bottoms in mid-term election years is common. Fortunately, the bottom of 2006 was minimal and not sharp when compared to that of 2002. The Dow is up 90.9% from the 2002 mid-term presidential election year bottom. The NASDAQ is up 143.0% since October 9, 2002. The S&P600, small caps, is up even more by 160.6% since October 9, 2002.

The NASDAQ is down 46.4% from its historical weekending high of 5048.62 on March 9, 2000. The Dow is up by 18.6% from its previous weekending historical high of 11723 on January 13, 2000. It took over five-and-a-half years for the DJIA to establish a new high. The S&P500 is up 1.6% since its previous all-time-weekly-closing-high of March 23, 2000. So far, the new century, 2000 inclusive, has not been kind to long-term investors. The NASDAQ needs to climb 86.5% to equal its all-time high. The S&P500 is struggling a bit into its uncharted record setting domain.

Historical standards suggest the NASDAQ will not return to its historical high until 2025 or so. A 2000 buyer and holder will not be back to break-even until then. Including inflation, a thirty-year-old investor will be in his or her eighties before the NASDAQ profits from early 2000 investment dollars, which assumes minimal inflation. However, the late 2002 investor is up triple digit amounts. Timing is indeed important.

Economic and corporate earnings fundamentals did not support the stock market’s meteoric rise in the 1990’s in many sectors. Unprecedented demand for stocks skewed the supply-demand ratio and, thus, the powerful bull leg of the 1990’s enjoyed sustainability. The simple law of supply and demand propelled stock prices dynamically to the north in the 1990’s. The great bear leg of 2001 and 2002 depressed those prior sources of demand for at least one generation of investors. The market now has to wait for a new generation of investors to enjoy dynamic secular bullishness even though it has been bullish since late 2002.

The great bull leg of 2003 was a relatively short bull cycle that has not enjoyed dynamic follow-on bullish behavior due to this lack of demand. As you can see from the NYSE trading range, the northerly sloping cycle is not as strong as the trading ranges from late 2002 through most of 2003. However, bullish expressions occur during the heart and soul of bullish seasonality regardless of any technical or fundamental reason. The meandering segments of 2002, 2003, 2004, 2005, and 2006 were appropriately followed by historically significant bullishness in each of those years.

As earlier stated, the Indicant began its buying barrage in October – November 2002 just after the market bottomed from the severe 2000-2002 Bear Market. There were 239-buy signals between October 5, 2002 and November 9, 2002 out of the 296 stocks and funds tracked by the Mid-term Indicant at that time. Even badly managed companies received a buy signal, which is a common attribute of sustainable new bull markets. As many of you noticed, those companies eventually dipped back to the south after the euphoria of new bullishness.

Since August 18, 2006, the Mid-term Indicant generated 220-buy signals and only 88-sell signals. That is an unusually high number of buy signals when considering historical seasonal market influences. This is a testament to the strength of the underlying bull market. All Indicant models supported this recent buying surge just as they did in October 2002 and March 2003.

Now that the heart and soul of bullish seasonality has expired, the resistance to generate sell signals has softened. There remains minor resistance to buy signals since the market is now enduring normal bearish seasonality. This resistance is minor since the market is enjoying the normal bullishness of presidential pre-election years.

Some of you recall the Indicant Stock Market Report tracking the Short-term Indicant Bear for the NASDAQ in 2002. It was the longest in history. It even exceeded the Dow’s 1929-1932 Short-term Indicant Bear in breadth and approached it in magnitude. The good news is that the NASDAQ’s decline did not lead to a depression, which is a clear indication of how little influence tech stocks have on the economy.

There are two important axioms to remember and are always repeated in this report. 1) Real economic wealth is created in only three ways - manufacturing, agriculture, and extraction. 2) The only positive influence politicians have on the economy is to undo their prior damage. That is also why the presidential pre-election year is historically the most bullish on the four-year cycle. If the strength of the current Mid-term Bull can be subjected only to meandering behavior, like 2004, 2005, and 2006, then it is possible for the current Mid-term Bull to be a record setting one in terms of duration.

Political institutions reduce wealth. Politicians continually attempt to redistribute wealth, which flies in the face of the laws of nature. They promote “middle class” attainment. The larger the middle class, the more power politicians and their academic brethren have. The communists tried that, resulting in 99% poverty, while the ruling 1% lived like kings. Socialism rewards an ability to intellectualize, while capitalism rewards the results of appealing effort. As long as the world’s populace moves in the direction of capitalism, the stock market will continue with a long-term bullish bias. If the market smells increased interests in socialism and similar concepts, it will turn bearish.

The remainder of this section, Secular Market Blend, is repeated, in part, from the past several months, but it does not hurt to reread it each week. As time progresses and conditions change, there will be modifications to it to maintain a balanced frame of reference.

You will notice many of the mutual fund buy signals occurred in March 2003. Many of them endured sell signals for the first time since early 2003 during the mildly bearish meandering behavior in mid-2005. However, the bull’s resiliency minimized selling activity. The Mid-term Indicant is now signaling hold for nearly all mutual funds it tracks.

Many of you recall how the market did not synchronize with the heart and soul of bullish seasonality from November 2002 through February 2003. December 2002 was the most bearish since 1931, but not nearly as dynamic as the 1931 bearish expression. After the asynchronous behavior in the November 2002 rolling third of the year, the market turned bullish in March 2003 and again did not synchronize with normal seasonality. The Mid-term Indicant continued signaling bull/hold during bearish seasonality in 2003. The market continued moving north during that time, contrary to historical seasonal standards, but consistent with political cycle standards. As stated in most of 2004, bearish expressions on a Mid-term basis between May and October 2004 should not be surprising. That is exactly what occurred. The result was a meandering market with a slight bearish bias during most of 2004 and 2005 and the first two-thirds of 2006. This presidential pre-election year is being fundamentally tested in the face of war, terrorist threats, and rising oil prices.

The Quick-term Indicant’s bearish bias during most of 2006 was replaced with a bullish bias in mid-August 2006. Several buy signals ensued shortly after that bias shift. Bullish behavior occurred, as expected, since mid-August 2006. As stated since that bullish bias shift, the various Indicant models, economic fundamentals, and historical standards suggest significant bullishness in the coming months.

The Dow is up 23.8% since the Quick-term Indicant bullish bias shift on August 15, 2006. The NASDAQ is up 28.0% since then. The S&P500 is up 20.8%.

Keep up with the Daily Stock Market Report.

http://www.indicant.net/Members/Updates/History-Seasonal/HS0001.htm

Make certain you read the entire pages on the above link. You will see there are exceptions.

Stop Loss Management

The Mid-term Indicant recommends a stop loss of 8% on recent buys because of the Quick-term Indicant’s bullish bias.

Stock and Fund Update

http://www.indicant.net/Non-Members/Performance/Top-Bot.htm

Economic Conditions – Inflation, Currency, Interest Rates

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

As stated last week, the 3-Month T-Bill continues moving mildly to the north. As stated last week and again this week, this increase in short-term interest rates did not discourage the bull from maintaining its dominance.

As stated the past four weeks, it is unlikely interest rates will rise during this presidential pre-election year. Unfortunately, their flat configuration induces bearish spurts from time to time. Rising commodity prices are a thorn viewed by the bull and remain as a constant threat.

As earlier stated, the problems in the sub-prime markets are being perceived as an economic threat. That threat is fostering an opinion of bullish enthusiasm that the Fed will have to fill the sub-prime void of economic influence with a rate reduction. This, on a short-term basis, supports the prevailing bullish bias. However, if the Fed biases support for economic growth and allows inflationary pressures to mount, the bear will find encouragement.

As stated the past six weeks, the various Indicant attributes are configuring in support of the historical standards of presidential pre-election-year and election-year stock market bullishness. The Fed will opt in favor of economic activity in the presidential pre-election year underway and next year’s election year. However, in 2009’s post election year, the bear would find absolute resolve in over-taking the bull if the Fed’s action manifests first a rapid inflationary spiral and then a rapid increase in rates to stifle the inflation.

As stated the past eight weeks, the Fed is “maintaining” prevailing rates. The problem is a tough one. Commodity prices continue to rise and the inflation battle is underway. Rising capitalism should invoke rising productivity. Will this productivity potential offset the inflationary threats of rising commodity prices?

Capitalists transform commodities into products. That transformation is where productivity potential exists. The result of that should be lower prices to the buyers of products even though the producer’s raw materials are higher.

As stated the past two weeks, the oil’s bearish yellow curve has shifted back to the north. Although its recent northerly cycle has not produced the same dramatic bearishness of the 1970’s, it consumed bullish energy from the stock market. If it resumes another cyclical rise, the result should be unfavorable to the stock market bull. Two bad results will manifest. Either inflation becomes more than a nuisance or interest rates rise or both. The bull will be weakened in the event either unfolds. Click the below link to view the oil charts.

http://www.indicant.net/Members/Updates/Economic/E03.htm

As stated the past two weeks, the CRB Bridge Futures is configuring similarly to oil. That configuration continues to threaten the bullish stock market bias. The Fed keeps a close eye on this barometer. Its chart is on the same link. Just scroll down a little to view it.

Overall, economic conditions appear shifting in favor of a continuation of this strong bull market.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 is up 389.5% since the April 13, 2001 buy signal. Its annualized growth since that buy signal is 61.4%. It moved to the north in 29 of the past 39-weeks. This fund was mildly bullish last week, following bullish aggressions two weeks ago.

Fidelity Gold, Fund #28, is up 46.0% since the Mid-term Indicant signaled buy on August 26, 2005. That annualizes to 24.1%. This fund was aggressively bullish in each of the past two weeks.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 330.5% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 66.4%.

Vanguard Energy #18, VGENX, is up 242.3% (annualized at 55.9%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 197.3% (annualized at 54.0%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 181.9% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 45.9%.

These energy related funds were aggressively bullish the past two weeks, which coincided with stock market bullishness. That is relative bullish convergence.

The SQI (Consolidated Short-term and Quick-term Indicant) model signaled buy for the GLD-ETF#11 on August 3, 2005. It is up 51.7% since then. It is annualized at 26.2%. This ETF has been bearish in five of the past nine weeks. It was bullish the past two weeks.

The SQI signaled buy for ETF#03 – Energy and Natural Resources on March 26, 2003. It is up 244.0% (annualized at 55.9%). This fund was also bullish the past two weeks.

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

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

All ten major indices are bulls. They are up by an average of 35.0% since the Mid-term Indicant signaled bull an average of 104-weeks ago. That annualizes to 17.6%, which is down significantly from the past three years. This is due to the bear signals for the S&P400 and S&P600 Indexes on July 21, 2006, which had been receiving a bull signal since October 25, 2002. Those two indices endured some fluttering after the expiration of the tremendous bull leg that lasted nearly four years. A new bull leg is underway and may proceed just as vigorously for these two indices as the bull leg from October 2002 through July 2006, where the S&P400 and S&P600 increased by 66.3% and 79.3%, respectively.

The Mid-term Indicant Dow Jones Industrial Average performance is now at $42,128,394.

That beats buy and hold performance of $2,125,815 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $200,450. That beats buy and hold’s $152,072 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $226,497. That beats buy and hold’s $93,863 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1,881.4%, 31.8%, and 141.3%, respectively, for these indices as of this past week.

Click here to go to the current Mid-term Indicant assessment of the ten major indices.

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

Divergence versus Convergence

After three weeks of combined bullish and bearish convergence/divergence, the market enjoyed full bullish convergence the past two weeks. That is a strong commitment to bullish bias. All major sectors moved aggressively to the north the past two weeks. The contrarian sectors also moved bullishly, which suggests economic optimism in spite of problems with sub-prime loans and rising energy costs.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

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

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

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

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

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

Mid-term Indicant Positions - Indicant Selected Stocks

Click here to see Indicant Select Stock Report Card history.

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

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant is now avoiding ProFunds Ultra Short. It is down 34.3% since the Mid-term Indicant signaled sell on September 15, 2006. Historical norms of market cyclicality suggest the next buying opportunity for this fund may not occur until 2009.

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

Always 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 380.4% (annualized at 24.2%) since the Long-term Indicant signaled bull 819-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, and inflation have not been strong enough to signal bear since that bull signal. A link to the Long-term Indicant is below:

http://www.indicant.net/Members/Updates/LTI-Markets-DJIA/DJIA.htm

Quick/Short-term Indicant Stock Market Report - Summary

Quick-term Red Bulls: Twenty-three of thirty; bullish bias remains, although weakening.

Quick-term Yellow Bears: Two; the market remains to near-maximum non-bearish support.

Short-term/Quick-term Non-Bearishness: Countering sustainable bearish ambition.

Force Vectors: Shifting south, which opens bearish opportunities the next few days.

Vector Pressure: Supportive of bullish bias.

Long-term Hold Positions: Solidly safe.

Current Quick-term Bias: Bullish

Overall Market Status: Bullish bias prevailing.

Profit Potential from Naked Options: Increasing volatility is favorable.

Volume: Configurations remain in support of underlying bullish bias.

Comments from April 20, 2007

Both the NASDAQ and NYSE Indexes passed above their upper trading range limit. That means a new trading range is being established and is not an indication of immediate bias.

Quick-term/Short-term Indicant Stock Market Report Details

The Short-term Indicant signaled bull on May 21, 2007 for both the Dow and NASDAQ. They are up 2.7% and up 5.0%, respectively, since then. Configurations continue supporting bullish bias in spite of last Tuesday’s bearish aggression. Bullish aggression the past three days suggests little interest in bearish influence. This is supported by the Quick-term and Short-term Indicant attributes.

Please read on. Click here to see the Short-term Indicant’s history.

Both Indicant Volume Indicator’s are flattening from their current lethargic cycle, based on high volume the past four days. That high volume is concurrent with both bearish and bullish activity, which suggested indecisiveness by last Wednesday. However, Thursday’s aggressive bullish behavior enjoyed higher volume than last Tuesday’s aggressive bearish behavior. The bull signaled loudly to the bear as to who is dominant. That supports the underlying bullish bias. As stated for the past several months, configurations continue to support bullish bias.

SQI Report Card (Consolidated Short/Quick), Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the SQI is signaling hold for 28-ETF’s. They are up 78.9% (annualized at 33.4%) since their respective buy signals an average of 121.5-weeks ago. Although there were no sell signals, the SQI is avoiding two ETF’s. They are up 0.3% since their sell signals an average of 3.2-weeks ago.

Short-term Indicant Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Short-term Indicant is signaling hold for 28-ETF’s. They are up an average of 86.4% (annualized 37.6%) since the STI signaled, buy, an average of 118.2-weeks ago. Although there were no sell signals, there are two avoid signals. They are up 0.3% since their sell signals an average of 3.2-weeks ago.

The Short-term Indicant is more active in buying/selling than the Consolidated model. The Quick-term Indicant, which follows, is even more active.

Quick-term Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Quick-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 26.8% (annualized at 25.4%) since the QTI signaled buy an average of 53.9-weeks ago. Although there were no sell signals, the Quick-term Indicant is avoiding two ETF’s. They are down by an average of 1.6% since their sell signals an average of 5.9-weeks ago.

Conflicts Between the Short-term and Quick-term Indicants

There are no conflicts, whereby the Short-term Indicant and the Quick-term Indicant are in disagreement between hold and avoid status. The bias shift on August 15, 2006 remains in favor of the bull.

Quick-term Indicant Bull/Bear Health Report

Two of the 30-ETF’s are below their bearish yellow curves. The average relative position of all thirty ETF’s is above bearish yellow by 11.8%. This remains configured in support of the market’s non-bearish posture. There is minimal support for sustainable bearish assertions.

Twenty-three ETF’s are above their respective bullish red curves. This configuration solidly supports the underlying bullish bias, although weakened. All thirty ETF average positions are 3.2% above their bullish red curves.

At this time, configurations indicate bearish expressions in the immediate future will be mere spurt behavior. There is no indication of sustainable bearish behavior.

Short-term Indicant Bull/Bear Health Report for ETF’s

Fourteen of the thirty ETF’s are contacting their breakout lines. As stated the past several months, the high concentration of breakout-contact since last August is solidly bullish. This repeated contact solidly supports the underlying bullish bias. Contact in fifty-five of the last seventy-one trading days remains supportive of bullish bias.

The average distance from breakout contact is a meager 1.7%. This remains in support of the bullish bias.

None of the ETF’s are contacting their respective breakdown lines. The average distance from the price and breakdown is 30.4%. This configuration provides tremendous non-bearish support, which has been the case since March 2003. There have been several bearish “spurts” since then with no sustainability or dynamic support. The probability of immediate contact remains low and thus a non-bearish bias is maintained on a short-term basis.

This attribute remains solidly non-bearish, regardless of recent bearish behavior.

ETF Force Vector Configurations

Fourteen of the thirty ETF Force Vectors continue toward bullish domains. As sated since last Monday, the bullish cycle is now mature and favoring a slight increased probability of potential bearish behavior. However, the underlying bias remains bullish.

To understand potential financial opportunities, click here to learn to identify Robust Force Vectors. They are visible on the Quick-term Indicant charts.

ETF Force Vectors/Vector Pressure Crossings/Option Signals

Remember, the links contained herein are more visible when reading this on the website.

Click this sentence for Vector Pressure Option Signals. There were two call option buy signals after the market close on Friday.

Comment about last Monday’s call option buy signal: It enjoyed excellent configurations with aggressive bearish behavior Tuesday. That most likely allowed your deep discounted buy offer to be transacted during last Tuesday’s aggressive bear. That bearish behavior was followed by mild bullishness on Wednesday and dynamic bullishness on Thursday. Following the two-day rule on selling should have resulted in a nice profit.

Comment about Friday’s call signals. One is gold, ETF-GLD. It can be a contrarian fund. It can rise while the stock market falters. Regardless, make certain you have stalked the option you like and offer deeply discounted buy prices. Do not despair if your offer is not accepted. There are plenty of opportunities available throughout the year.

Twenty-three ETF Vector Pressures are in bullish domains. The current configurations remain in support the Quick-term bullish bias shift from August 15, 2006, although favoring increasing bearish spurt activity. It is common for bull/bear battles when Vector Pressure is being threatened from its support of the prevailing bias.

Make certain you sell naked options when the Force Vectors shift direction or within two days of the purchase, whichever occurs first. If you are unfamiliar with this, take the options tour.

Quick-term and Short-term Indicant Summary

Do not write covered call options while Vector Pressure is positive (bullish), which is the current configuration.

The Quick-term Bull remains in tact.

To familiarize yourself with viewing the market from an ETF perspective, click the following update links.

Quick-term ETF Options

Quick-term Indicant for ETF’s

Short-term Indicant for ETF’s

Consolidated Quick-term/Short-term Indicant for ETF’s

Click here to the report card, which is updated weekly, to link to related tours.

Links to the Short-term Indicant and Indicant Volume Indicator are below:

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

Indicant Conclusion

The past two weeks are configured with bullish convergence. The bullish bias remains very healthy.

Vector Pressure continues to support the bullish bias. It has been doing that since August 15, 2006.

Although recent bearishness has weakened several Quick-term Indicant attributes, the underlying bullish bias remains in tact. Keep up with the daily stock market report as the Quick-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

In addition, 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

07/15/07

July 08, 2007 Indicant Weekly Stock Market Report

Volume 07, Issue 02 ISSN 1526 6516 © The Indicant Stock Market Report

This Week’s Report

The Bullish Bias Prevails – Part IV

There is very little to add to last week’s report. As stated last week, historical standards of presidential pre-election year bullishness continue to be congruent with expectations. Bull convergence occurred last week with solid bullish performance in most major sectors; precious metals, energy, and stocks.

The economy remains strong in spite of higher oil prices. Corporate earnings are projected to slow, but law of supply and demand for stocks should continue to supporting the underlying bullish bias.

Keep up with the daily stock market report. This year is setting up to be nicely bullish. Even if bearish spurts act as drag on the underlying bullish bias, the heart and soul of bullish seasonality will more than offset any damaging bearish spurts.

Weekly Buy/Sell Summary – Stocks and Funds

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

In addition to the sell signal, the Mid-term Indicant is avoiding 36-stocks and funds of the 345- tracked by the Indicant. The avoided stocks and funds are down an average of 12.7% since the Mid-term Indicant signaled sell an average of 27.8-weeks ago.

There were 136-stocks and funds avoided at this time last year. Those avoided stocks and funds were down an average of 5.9% since their respective sell signals an average of 16.2-weeks earlier.

Two years ago, on July 8, 2005, the Mid-term Indicant was avoiding 116-stocks and funds that were down an average of 25.4% since their respective sell signals an average of 61.3-weeks earlier. Three years ago on July 9, 2004 there were only 36-avoided stocks and funds. They were down by an average of 31.2% from their respective sell signals an average of 45.9-weeks earlier. On July 5, 2003, the Mid-term Indicant was avoiding only 14-stocks and funds out of 296-tracked at that time. They were down by an average of 27.4% since their sell signals an average of 28.3-weeks earlier. Five years ago on July 5, 2002, there were 217-avoided stocks and funds. They were down an average of 22.3% since their respective sell signals an average of 10.4-weeks earlier.

Although there were no buy signals, the Mid-term Indicant is signaling hold for 308 of the 345-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 140.6%. That annualizes to 65.9%. The Mid-term Indicant has been signaling hold for these 308-stocks and funds for an average of 110.9-weeks.

One year ago, on July 7, 2006, the Mid-term Indicant was holding 202-stocks and funds out of the 345 tracked for an average of 113.8-weeks. Those 202-stocks and funds were up by an average of 152.4% (annualized at 69.7%). The Mid-term Indicant was signaling hold for 195-stocks and funds of the 320-tracked two years ago on July 8, 2005. They were up by an average of 110.7 (annualized at 59.2%) since their respective buy signals an average of 97.3-weeks earlier. There were 246-stocks and funds with hold signals on July 9, 2004 since their buy signals an average of 53.7-weeks earlier. They were up by an average of 67.8% (annualized at 65.6%).

The Indicant was only tracking 296-stocks and funds in 2002-2003, and early 2004. On July 5, 2003, the Mid-term Indicant was signaling hold for 277-stocks and funds out of 296-tracked. They were up by an average of 44.7% (annualized at 100.2%) since their buy signals an average of 23.2-weeks earlier. Five years ago, on July 5, 2002, there were only 66-hold signals for stocks and funds out of the 294 tracked by the Mid-term Indicant. They were up 41.0% (annualized at 47.8%) since their respective buy signals an average of 40.4-weeks earlier.

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

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

http://www.indicant.net/Members/Updates/All%20Update%20Forms/Buy-Sell%20Summary%20This%20Week.htm

All updated information can be found from a single page at Indicant.Net. Click the below link to that page. You will need your login ID and password.

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

The Quick/Short-term Indicant Stock Market Report

The Indicant website maintains the last twelve months of daily reports on an annual basis. These weekly reports are maintained for much longer periods. Beginning in March 2006, the daily stock market report for the last trading day of each week is imbedded in this weekly report. This allows web-based retention records of the daily report for much longer than the last twelve months.

The Indicant Stock Market Report’s Secular Market Blend

Deep bearish seasonality was not influential in 2006, which usually occurs from late August through early October. Last August, the Quick-term Indicant obviated a bullish bias, contrary to the historical standards of deep bearish seasonality. Many buy signals occurred in late August - early September 2006, which was unusual. Those buy signals matured into very financially successful hold signals.

From January 31, 2003 through September 30, 2003, the Dow was up 15.2%, while the NASDAQ was up 35.3%. The last presidential pre-election year was 2003. Presidential pre-election years are traditionally bullish. Post “heart and soul bullish seasonality” in the pre-election year of 2003 did not drag energy from the bull. So far in this presidential pre-election year, the Dow is up 7.8% since January 31, 2007 and the NASDAQ is up 8.2%.

Aggressive bearish expressions nineteen weeks ago and again seventeen weeks ago pushed the major indices into negative territory, which can happen after the heart and soul of bullish seasonality expires. Those particular bearish expressions were mere spurts and lacked sustainability. The bearish expression during the week of June 3, 2007 and three weeks ago are configured as bearish spurts. Spurts occur from time to time as the crowd has fits of momentary influence on the market’s direction.

Historical standards suggest the market will go much higher this year. Political and economic fundamentals also support this prognosis.

The Dow30 found bottom in the last presidential mid-term election year on October 9, 2002 at 7,286.27. The NASDAQ found bottom on the same day at 1114.11. Finding cyclical bottoms in mid-term election years is common. Fortunately, the bottom of 2006 was minimal and not sharp when compared to that of 2002. The Dow is up 86.8% from the 2002 mid-term presidential election year bottom. The NASDAQ is up 139.3% since October 9, 2002. The S&P600, small caps, is up even more by 157.8% since October 9, 2002.

The NASDAQ is down 47.2% from its historical weekending high of 5048.62 on March 9, 2000. The Dow is up by 16.1% from its previous weekending historical high of 11723 on January 13, 2000. It took over five-and-a-half years for the DJIA to establish a new high. The S&P500 is up 0.2% since its previous all-time-weekly-closing-high of March 23, 2000. So far, the new century, 2000 inclusive, has not been kind to long-term investors. The NASDAQ needs to climb 89.3% to equal its all-time high. The S&P500 is struggling a bit into its uncharted record setting domain.

Since August 18, 2006, the Mid-term Indicant generated 220-buy signals and only 87-sell signals. That is an unusually high number of buy signals when considering historical seasonal market influences. This is a testament to the strength of the underlying bull market. All Indicant models supported this recent buying surge just as they did in October 2002 and March 2003. Now that the heart and soul of bullish seasonality has expired, the resistance to generate sell signals has softened. There remains minor resistance to buy signals since the market is now enduring normal bearish seasonality. This resistance is minor since the market is enjoying the normal bullishness of presidential pre-election years.

The Dow is up 21.2% since the Quick-term Indicant bullish bias shift on August 15, 2006. The NASDAQ is up 26.1% since then. The S&P500 is up 19.0%.

Keep up with the Daily Stock Market Report.

http://www.indicant.net/Members/Updates/History-Seasonal/HS0001.htm

Make certain you read the entire pages on the above link. You will see there are exceptions.

Stop Loss Management

The Mid-term Indicant recommends a stop loss of 8% on recent buys because of the Quick-term Indicant’s bullish bias.

Stock and Fund Update

http://www.indicant.net/Non-Members/Performance/Top-Bot.htm

Economic Conditions – Inflation, Currency, Interest Rates

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

As stated last week, the 3-Month T-Bill is rebounding. It moved from bearish (bullish for stock market) domains to neutrality. Interestingly, the increase in short-term interest rates did not discourage the bull from maintaining its dominance. As stated last week, do not fight the bullish stock market trend.

As stated the past three weeks, it is unlikely interest rates will rise during this presidential pre-election year. Unfortunately, their flat configuration induces bearish spurts from time to time. Rising commodity prices are a thorn viewed by the bull.

As stated the past five weeks, this is shaping up to support the historical standards of presidential pre-election-year and election-year stock market bullishness.

As stated the past seven weeks, the Fed is “maintaining” prevailing rates. The problem is a tough one. Commodity prices continue to rise and the inflation battle is underway. Rising capitalism should invoke rising productivity. Will this productivity potential offset the inflationary threats of rising commodity prices?

As stated last week, the oil’s bearish yellow curve has shifted back to the north. Although its recent northerly cycle has not produced the same dramatic bearishness of the 1970’s, it consumed bullish energy from the stock market. If it resumes another cyclical rise, the result should be unfavorable to the stock market bull. Two bad results will manifest. Either inflation becomes more than a nuisance or interest rates rise or both. The bull will be weakened in the event either unfolds. Click the below link to view the oil charts.

http://www.indicant.net/Members/Updates/Economic/E03.htm

Also, as stated last week, the CRB Bridge Futures is configuring similarly to oil. The Fed keeps a close eye on this barometer. Its chart is on the same link. Just scroll down a little to view it.

This paragraph is repeated from the past six weeks. Productivity improvements are evolutionary, whereas commodity prices can be revolutionary. The sudden increase in the number of capitalists is revolutionary. However, it takes time and a lot of effort to increase productivity. The exponentially increased demand for commodities can out-pace the impending productivity increases and thus set off inflation. This is an issue confronting both the Fed and the stock market. The prevailing stock market perception is that productivity will be the economic savior.

Overall, economic conditions appear shifting in favor of a continuation of this strong bull market.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 is up 384.0% since the April 13, 2001 buy signal. Its annualized growth since that buy signal is 60.8%. It moved to the north in 28 of the past 38-weeks. This fund aggressively bullish last week.

Fidelity Gold, Fund #28, is up 41.3% since the Mid-term Indicant signaled buy on August 26, 2005. That annualizes to 21.9%. This fund was also extremely bullish last week.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 323.7% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 65.3%.

Vanguard Energy #18, VGENX, is up 232.2% (annualized at 53.8%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 194.8% (annualized at 53.6%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 175.1% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 44.4%.

These energy related funds were bullish last week, which coincided with stock market bullishness. That is relative bullish convergence.

The SQI (Consolidated Short-term and Quick-term Indicant) model signaled buy for the GLD-ETF#11 on August 3, 2005. It is up 49.2% since then. It is annualized at 25.2%. This ETF has been bearish in five of the past eight weeks. It was bullish last week.

The SQI signaled buy for ETF#03 – Energy and Natural Resources on March 26, 2003. It is up 231.6% (annualized at 53.3%). This fund was also bullish last week.

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

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

All ten major indices are bulls. They are up by an average of 32.6% since the Mid-term Indicant signaled bull an average of 103-weeks ago. That annualizes to 16.5%, which is down significantly from the past three years. This is due to the bear signals for the S&P400 and S&P600 Indexes on July 21, 2006, which had been receiving a bull signal since October 25, 2002. Those two indices endured some fluttering after the expiration of the tremendous bull leg that lasted nearly four years. A new bull leg is underway and may proceed just as vigorously for these two indices as the bull leg from October 2002 through July 2006, where the S&P400 and S&P600 increased by 66.3% and 79.3%, respectively.

The Mid-term Indicant Dow Jones Industrial Average performance is now at $41,233,041.

That beats buy and hold performance of $2,080,847 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $197,601. That beats buy and hold’s $149,911 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $223,109. That beats buy and hold’s $92,459 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1,881.4%, 31.8%, and 141.3%, respectively, for these indices as of this past week.

Click here to go to the current Mid-term Indicant assessment of the ten major indices.

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

Divergence versus Convergence

After three weeks of combined bullish and bearish convergence/divergence, the market enjoyed full bullish convergence last week. That is a strong commitment to bullish bias. All major sectors moved aggressively to the north last week.

Mid-term Indicant Positions - NASDAQ100 Stocks

Click here to see NASDAQ100 report card history.

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

Mid-term Indicant Positions - Dow Jones 30 Industrial Stocks

Click here to see Dow 30 report card history.

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

Mid-term Indicant Positions - Dow Jones 15 Utility Stocks

Click here to see Dow Utilities Report Card history.

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

Mid-term Indicant Positions - Indicant Selected Stocks

Click here to see Indicant Select Stock Report Card history.

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

Mid-term Indicant Positions - Mutual Funds

Click here to see Mutual Fund Report Card history.

The Mid-term Indicant is now avoiding ProFunds Ultra Short. It is down 27.7% since the Mid-term Indicant signaled sell on September 15, 2006. Historical norms of market cyclicality suggest the next buying opportunity for this fund may not occur until 2009.

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

Always 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 370.2% (annualized at 23.5%) since the Long-term Indicant signaled bull 818-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, and inflation have not been strong enough to signal bear since that bull signal. A link to the Long-term Indicant is below:

http://www.indicant.net/Members/Updates/LTI-Markets-DJIA/DJIA.htm

Quick/Short-term Indicant Stock Market Report - Summary

Quick-term Red Bulls: Twenty-one of thirty; bullish bias remains.

Quick-term Yellow Bears: Two; the market remains to near maximum non-bearish support.

Short-term/Quick-term Non-Bearishness: Countering sustainable bearish ambition.

Force Vectors: Moving north on a quick-term basis. Potential robustness developing.

Vector Pressure: Supportive of bullish bias.

Long-term Hold Positions: Solidly safe.

Current Quick-term Bias: Bullish

Overall Market Status: Bullish bias prevailing.

Profit Potential from Naked Options: Improving with increasing volatility.

Volume: Configurations remain in support of underlying bullish bias.

Comments from April 20, 2007

Both the NASDAQ and NYSE Indexes passed above their upper trading range limit. That means a new trading range is being established and is not an indication of immediate bias.

Quick-term/Short-term Indicant Stock Market Report Details

The Short-term Indicant signaled bull on May 21, 2007 for both the Dow and NASDAQ. They are up 0.5% and up 3.4%, respectively, since then. Configurations continue supporting bullish bias. Please read on. Click here to see the Short-term Indicant’s history.

As stated the past few days, both Indicant Volume Indicator’s were demonstrating an interest in a robust cycle. That embryonic configuration suggested little resistance to bearish aggression. That was because the increase in volume was concurrent with bearish behavior. That cycle did not mature enough to obviate the market’s directional intention. Holiday volume has now induced the seasonally lethargic cycle. At this time, configurations continue to support bullish bias.

SQI Report Card (Consolidated Short/Quick), Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the SQI is signaling hold for 29-ETF’s. They are up 79.7% (annualized at 33.0%) since their respective buy signals an average of 124.1-weeks ago. The SQI is avoiding one ETF. It is down 2.6% since its sell signal 5.0-weeks ago.

Short-term Indicant Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Short-term Indicant is signaling hold for 29-ETF’s. They are up an average of 84.6% (annualized 36.0%) since the STI signaled, buy, an average of 121.0-weeks ago. There is one avoid signal. That fund is down 2.6% since its sell signal 5.0-weeks ago.

Keep in mind, the Short-term Indicant is much more active in buying/selling than the Consolidated model. The Quick-term Indicant, which follows, is even more active.

Quick-term Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Quick-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 24.5% (annualized at 23.8%) since the QTI signaled buy an average of 52.9-weeks ago. Although there were no sell signals, the Quick-term Indicant is avoiding two ETF’s. They are down by an average of 1.8% since their sell signals an average of 4.9-weeks ago.

Conflicts Between the Short-term and Quick-term Indicants

There is one conflict, whereby the Short-term Indicant and the Quick-term Indicant are in disagreement between hold and avoid status. The bias shift on August 15, 2006 remains in favor of the bull.

There are 86-hold signals out of a possible 90. There are four avoid signals with three related to the same fund. The bias remains in obvious support of the bull, although weakened recently.

Quick-term Indicant Bull/Bear Health Report

Two of the 30-ETF’s are below their bearish yellow curves. The average relative position of all thirty ETF’s is above bearish yellow by 10.5%. This remains configured in support of the market’s non-bearish posture. There is minimal support for sustainable bearish assertions.

Twenty-one ETF’s are above their respective bullish red curves. This configuration solidly supports the underlying bullish bias, although weakened. All thirty ETF average positions are 2.3% above their bullish red curves.

At this time, configurations indicate bearish expressions in the immediate future will be mere spurt behavior. There is no indication of sustainable bearish behavior.

Short-term Indicant Bull/Bear Health Report for ETF’s

Twelve of the thirty ETF’s are contacting their breakout lines. As stated the past several months, the high concentration of breakout-contact since last August is solidly bullish. This repeated contact solidly supports the underlying bullish bias. Contact in fifty-one of the last sixty-six trading days remains supportive of bullish bias. An absence of contact in eight of the past twelve trading days suggests the bear’s ambition is being thwarted by the bull. The bull remains cyclically dominant.

The average distance from breakout contact is a meager 2.1%. This remains in support of the bullish bias.

None of the ETF’s are contacting their respective breakdown lines. The average distance from the price and breakdown is 28.4%. This configuration provides tremendous non-bearish support, which has been the case since March 2003. There have been several bearish “spurts” since then with no sustainability or dynamic support. The probability of immediate contact remains low and thus a non-bearish bias is maintained on a short-term basis.

This attribute remains solidly non-bearish, regardless of recent bearish behavior.

ETF Force Vector Configurations

Twenty-nine of the thirty ETF Force Vectors continue toward bullish domains. As stated last week, the bearish cycle appears reversing, which should dampen bearish enthusiasm. Bullish behavior the past four trading days, albeit not dynamic, confirmed that prognosis.

To understand potential financial opportunities, click here to learn to identify Robust Force Vectors. They are visible on the Quick-term Indicant charts.

ETF Force Vectors/Vector Pressure Crossings/Option Signals

Remember, the links contained herein are more visible when reading this on the website.

Click this sentence for Vector Pressure Option Signals. There was one call option buy signal after Friday’s close. The many call options last Monday and Tuesday were supported by bullish Force Vector behavior and rising Vector Pressure. They are still rising. As stated the past few days, if your stalked options endured a intraday contrarian price movement whereby your deeply discounted offer occurred, there is an excellent chance you should enjoy profits. If you see Force Vectors declining (see previous section), do not hesitate on selling the options. (Note: Force Vectors held at 29 on Friday and therefore did not fall).

Twenty ETF Vector Pressures are in bullish domains. That is down by two from two weeks ago and down by one since June 15. This is somewhat of a concern. The current configurations remain in support the Quick-term bullish bias shift from August 15, 2006, although favoring increasing bearish spurt activity. It is common for bull/bear battles when Vector Pressure is being threatened from its support of the prevailing bias.

Make certain you sell naked options when the Force Vectors shift direction or within two days of the purchase, whichever occurs first. If you are unfamiliar with this, take the options tour.

Quick-term and Short-term Indicant Summary

Do not write covered call options while Vector Pressure is positive (bullish), which is the current configuration.

The Quick-term Bull remains in tact.

To familiarize yourself with viewing the market from an ETF perspective, click the following update links.

Quick-term ETF Options

Quick-term Indicant for ETF’s

Short-term Indicant for ETF’s

Consolidated Quick-term/Short-term Indicant for ETF’s

Click here to the report card, which is updated weekly, to link to related tours.

Links to the Short-term Indicant and Indicant Volume Indicator are below:

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

Indicant Conclusion

Bullish convergence was enjoyed last week. This was a significant counter-punch to bullish divergence and bearish convergence in recent weeks. The bullish bias remains very healthy.

Vector Pressure continues to support the bullish bias. It has been doing that since August 15, 2006.

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

In addition, 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

07/08/07

July 01, 2007 Indicant Weekly Stock Market Report

This Week’s Report

The Bullish Bias Prevails – Part III

Historical stock market standards do not always replicate. Variance from standards is common, regardless of subject. Standards are established by either design or noticeable repeatability. Bullish stock market behavior is common during presidential pre-election years. It is the repeatability and consistency of that phenomenon that suggests it is a historical standard.

The market has completed the first half of this presidential pre-election year with classical bullishness. Even the orchestrated manipulations, inducing bearish behavior in late February and early March, could not shut down the historical standard of presidential pre-election year stock market bullishness.

The Dow is up 7.6% at the halfway point this year. The NASDAQ is up 7.8% this year. That contrasts with the NASDAQ being down by 1.5% at this time of year in last year’s mid-term election year. So far this year, the historical standard is being replicated.

The magnitude of stock market movement is not replicated. For example, twenty years ago in 1987, the Dow’s bullishness amounted to only a 2.3%-gain. That particular presidential pre-election year contained the stock market crash of 1987. Even with that horrendous bearish expression in October 1987, the Dow performed to the directional historical standard of bullish behavior, although barely.

Any bullish conclusion to this year will conform to the historical standard of stock market bullishness during presidential pre-election years.

Since 1832, the average stock market gain during presidential pre-election years is 10.6%. If the Dow were to rise a mere few more percentage points for the remainder of the year, it would be an average performer in terms of magnitude.

A ten thousand dollar stock market investment on December 31, 1834 and sold on December 31, 1835 would have netted a $310 pre-commission profit. The first presidential pre-election year on record with stock market data is 1835 even though the Dow was not yet formulated.

That balance of $10,310 reinvested again on December 31, 1838 would have resulted in a loss when sold on December 31, 1839. That particular presidential pre-election year was a variance to the historical standard of stock market bullishness. The pre-commission loss amounted to 12.3%.

The balance of $9,042 was eagerly invested on the eve of the next presidential pre-election year on December 31, 1842. The presidential pre-election year investor enjoyed one of the most bullish years with a 45.5% pre-election year gain. Again, stocks were sold on December 31, 1843 at $13,111-commission free.

Repeating this cycle only during presidential pre-election year resulted in a balance of $283,810 as of December 31, 2003. That is a nice 2,738% gain over the long haul. However, there were periods of disappointment. For example, the market fell 37.7% during the 1907 pre-election year. It fell a whopping 52.7% in the 1929 pre-election year. It has not fallen since that 1929 debacle, although there have been a few presidential pre-election years with meager single digit gains.

This presidential pre-election year is shaping up to be bullish. The heart and soul of bullish seasonality has not yet occurred. It would not be surprising to see the majority of this year’s bullish gains occur during that time. The market is shaping up for a period of lethargy, which should provide a fulcrum for maximum bullish thrust during the heart and soul of bullish seasonality later this year.

Keep up with the daily stock market report so you can differentiate variance from historical standards, as spurt or sustainable behavior.

Weekly Buy/Sell Summary – Stocks and Funds

The Mid-term Indicant generated one buy signal and five sell signals.

In addition to the sell signals, the Mid-term Indicant is avoiding 31-stocks and funds of the 345- tracked by the Indicant. The avoided stocks and funds are down an average of 15.6% since the Mid-term Indicant signaled sell an average of 29.6-weeks ago.

There were 136-stocks and funds avoided at this time last year. Those avoided stocks and funds were down an average of 5.0% since their respective sell signals an average of 15.2-weeks earlier.

Two years ago, on July 1, 2005, the Mid-term Indicant was avoiding 122-stocks and funds that were down an average of 26.4% since their respective sell signals an average of 60.3-weeks earlier. Three years ago on July 2, 2004 there were only 35-avoided stocks and funds. They were down by an average of 30.3% from their respective sell signals an average of 45.1-weeks earlier. On June 28, 2003, the Mid-term Indicant was avoiding only 3-stocks and funds out of 296-tracked at that time. They were down by an average of 26.9% since their sell signals an average of 27.6-weeks earlier. Five years ago on June 28, 2002, there were 213-avoided stocks and funds. They were down an average of 17.8% since their respective sell signals an average of 10.0-weeks earlier.

In addition to the buy signal, the Mid-term Indicant is signaling hold for 308 of the 345-stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 135.2%. That annualizes to 63.9%. The Mid-term Indicant has been signaling hold for these 308-stocks and funds for an average of 110.0-weeks.

One year ago, on June 30, 2006, the Mid-term Indicant was holding 208-stocks and funds out of the 345 tracked for an average of 113.0-weeks. Those 208-stocks and funds were up by an average of 151.4% (annualized at 69.7%). The Mid-term Indicant was signaling hold for 196-stocks and funds of the 320-tracked two years ago on July 1, 2005. They were up by an average of 108.0% (annualized at 58.7%) since their respective buy signals an average of 95.7-weeks earlier. There were 257-stocks and funds with hold signals on July 2, 2004 since their buy signals an average of 51.7-weeks earlier. They were up by an average of 68.9% (annualized at 69.3%).

The Indicant was only tracking 296-stocks and funds in 2002-2003, and early 2004. On June 28, 2003, the Mid-term Indicant was signaling hold for 277-stocks and funds out of 296-tracked. They were up by an average of 42.6% (annualized at 99.7%) since their buy signals an average of 22.2-weeks earlier. Five years ago, on Jun 28, 2002, there were only 71-hold signals for stocks and funds out of the 294 tracked by the Mid-term Indicant. They were up 39.9% (annualized at 51.3%) since their respective buy signals an average of 40.4-weeks earlier.

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

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

http://www.indicant.net/Members/Updates/All%20Update%20Forms/Buy-Sell%20Summary%20This%20Week.htm

All updated information can be found from a single page at Indicant.Net. Click the below link to that page. You will need your login ID and password.

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

The Quick/Short-term Indicant Stock Market Report

The Indicant Stock Market Report’s Secular Market Blend

Deep bearish seasonality was not influential in 2006, which usually occurs from late August through early October. Last August, the Quick-term Indicant obviated a bullish bias, contrary to the historical standards of deep bearish seasonality. Many buy signals occurred in late August - early September 2006, which was unusual. Those buy signals matured into very financially successful hold signals.

From January 31, 2003 through September 30, 2003, the Dow was up 15.2%, while the NASDAQ was up 35.3%. The last presidential pre-election year was 2003. Presidential pre-election years are traditionally bullish. Post “heart and soul bullish seasonality” in the pre-election year of 2003 did not drag energy from the bull. So far in this presidential pre-election year, the Dow is up 6.2% since January 31, 2007 and the NASDAQ is up 5.7%.

Aggressive bearish expressions eighteen weeks ago and again sixteen weeks ago pushed the major indices into negative territory, which can happen after the heart and soul of bullish seasonality expires. Those particular bearish expressions were mere spurts and lacked sustainability. The bearish expression during the week of June 3, 2007 and two weeks ago are configured as bearish spurts, as well, and at this time. Spurts occur from time to time as the crowd has fits of momentary influence on the market’s direction.

Historical standards suggest the market will go much higher this year. Political and economic fundamentals also support this prognosis.

The Dow30 found bottom in the last presidential mid-term election year on October 9, 2002 at 7,286.27. The NASDAQ found bottom on the same day at 1114.11. Finding cyclical bottoms in mid-term election years is common. Fortunately, the bottom of 2006 was minimal and not sharp when compared to that of 2002. The Dow is up 84.0% from the 2002 mid-term presidential election year bottom. The NASDAQ is up 133.7% since October 9, 2002. The S&P600, small caps, is up even more by 153.2% since October 9, 2002.

The NASDAQ is down 48.4% from its historical weekending high of 5048.62 on March 9, 2000. The Dow is up by 14.4% from its previous weekending historical high of 11723 on January 13, 2000. It took over five-and-a-half years for the DJIA to establish a new high. The S&P500 is down 1.6% since its previous all-time-weekly-closing-high of March 23, 2000. So far, the new century, 2000 inclusive, has not been kind to long-term investors. The NASDAQ needs to climb 93.9% to equal its all-time high. The S&P500 is struggling a bit into its uncharted record setting domain.

Economic or corporate earnings fundamentals did not support the stock market’s meteoric rise in the 1990’s in many sectors. Unprecedented demand for stocks skewed the supply-demand ratio and, thus, the powerful bull leg of the 1990’s enjoyed sustainability. The simple law of supply and demand propelled stock prices dynamically to the north in the 1990’s. The great bear leg of 2001 and 2002 depressed those prior sources of demand for at least one generation of investors. The market now has to wait for a new generation of investors to enjoy dynamic secular bullishness even though it has been bullish since late 2002.

Since August 18, 2006, the Mid-term Indicant generated 220-buy signals and only 86-sell signals. That is an unusually high number of buy signals when considering historical seasonal market influences. This is a testament to the strength of the underlying bull market. All Indicant models supported this recent buying surge just as they did in October 2002 and March 2003. Now that the heart and soul of bullish seasonality has expired, the resistance to generate sell signals has softened. There remains minor resistance to buy signals since the market is now enduring normal bearish seasonality. This resistance is minor since the market is enjoying the normal bullishness of presidential pre-election years.

Political institutions reduce wealth. Politicians continually attempt to redistribute wealth, which flies in the face of the laws of nature. They promote “middle class” attainment. The larger the middle class, the more power politicians and their academic brethren have. The communists tried that, resulting 99% poverty, while the ruling 1% lived like kings. Socialism rewards an ability to intellectualize, while capitalism rewards the results of appealing effort. As long as the world’s populace moves in the direction of capitalism, the stock market will continue with a long-term bullish bias. If the market smells increased interests in socialism and similar concepts, it will turn bearish.

The Dow is up 19.4% since the Quick-term Indicant bullish bias shift on August 15, 2006. The NASDAQ is up 23.1% since then. The S&P500 is up 16.9%.

Keep up with the Daily Stock Market Report.

http://www.indicant.net/Members/Updates/History-Seasonal/HS0001.htm

Make certain you read the entire pages on the above link. You will see there are exceptions.

Stop Loss Management

The Mid-term Indicant recommends a stop loss of 8% on recent buys because of the Quick-term Indicant’s bullish bias.

Stock and Fund Update

http://www.indicant.net/Non-Members/Performance/Top-Bot.htm

Economic Conditions – Inflation, Currency, Interest Rates

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

The 3-Month T-Bill is rebounding, but cyclically remaining bearish (bullish for the stock market). That T-Bill rebound in addition to other interest rates aroused the bear last week. The idea here is to not fight the cycle. Also, do not fight the bullish stock market trend.

As stated the past two weeks, it is unlikely interest rates will rise during this presidential pre-election year. Unfortunately, their flat configuration induces bearish spurts from time to time. Rising commodity prices are a thorn viewed by the bull.

As stated the past four weeks, this is shaping up to support the historical standards of presidential pre-election-year and election-year stock market bullishness.

As stated the past six weeks, the Fed is “maintaining” prevailing rates. The problem is a tough one. Commodity prices continue to rise and the inflation battle is underway. Rising capitalism should invoke rising productivity. Will this productivity potential offset the inflationary threats of rising commodity prices?

As stated last week, the bearish yellow curve has shifted back to the north. Although its recent northerly cycle did not produce the same dramatic bearishness of the 1970’s, it consumed bullish energy from the stock market. If it resumes another cyclical rise, the result should be unfavorable to the stock market bull. Two bad results will manifest. Either inflation becomes more than a nuisance or interest rates rise or both. The bull will be severely weakened in the event either unfolds. Click the below link to view the oil charts.

http://www.indicant.net/Members/Updates/Economic/E03.htm

Also, as stated last week, the CRB Bridge Futures is configuring similarly to oil. The Fed keeps a close eye on this barometer. Its chart is on the same link. Just scroll down a little to view it.

This paragraph is repeated from the past five weeks. Productivity improvements are evolutionary, whereas commodity prices can be revolutionary. The sudden increase in the number of capitalists is revolutionary. However, it takes time and a lot of effort to increase productivity. The exponentially increased demand for commodities can out-pace the impending productivity increases and thus set off inflation. This is an issue confronting both the Fed and the stock market. The prevailing stock market perception is that productivity will be the economic savior.

Overall, economic conditions appear shifting in favor of a continuation of this strong bull market.

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 is up 362.3% since the April 13, 2001 buy signal. Its annualized growth since that buy signal is 57.5%. It moved to the north in 27 of the past 37-weeks. This fund was mildly bearish last week.

Fidelity Gold, Fund #28, is up 34.7% since the Mid-term Indicant signaled buy on August 26, 2005. That annualizes to 18.6%. This fund was also mildly bearish last week.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 311.1% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 63.0%.

Vanguard Energy #18, VGENX, is up 221.1% (annualized at 51.5%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 183.9% (annualized at 50.9%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 166.5% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 42.2%.

These energy related funds were bearish last week, which coincided with mild stock market bullish behavior. That is bullish divergence.

The SQI (Consolidated Short-term and Quick-term Indicant) model signaled buy for the GLD-ETF#11 on August 3, 2005. It is up 47.6% since then. It is annualized at 24.7%. This ETF has been bearish in five of the past seven weeks. It was mildly bearish the past two weeks.

The SQI signaled buy for ETF#03 – Energy and Natural Resources on March 26, 2003. It is up 220.9% (annualized at 51.1%). This fund was also bearish the past two weeks.

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

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

All ten major indices are bulls. They are up by an average of 30.0% since the Mid-term Indicant signaled bull an average of 102-weeks ago. That annualizes to 15.4%, which is down significantly from the past three years. This is due to the bear signals for the S&P400 and S&P600 Indexes on July 21, 2006, which had been receiving a bull signal since October 25, 2002. Those two indices endured some fluttering after the expiration of the tremendous bull leg that lasted nearly four years. A new bull leg is underway and may proceed just as vigorously for these two indices as the bull leg from October 2002 through July 2006, where the S&P400 and S&P600 increased by 66.3% and 79.3%, respectively.

The Mid-term Indicant Dow Jones Industrial Average performance is now at $40,617,924.

That beats buy and hold performance of $2,049,954 on a $10,000 investment in the Dow stocks in 1900. The MTI S&P500 is at $194,104. That beats buy and hold’s $147,257 on a December 31, 1971 $10,000 investment. The MTI-NASDAQ is at $217,814. That beats buy and hold’s $90,265 on an October 18, 1985 $10,000 investment. The Mid-term Indicant model beats buy and hold by 1,881.4%, 31.8%, and 141.3%, respectively, for these indices as of this past week.

Click here to go to the current Mid-term Indicant assessment of the ten major indices.

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

Divergence versus Convergence

After enduring bearish divergence two weeks ago, the market enjoyed mild bullish convergence this past week. General equities moved mildly north, while energy moved more aggressively to the south. This was the expected response to the previous week’s bearish convergence with the underlying bearish spurt configuration.

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 Mid-term Indicant Table of Mutual Funds.

Always 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 363.2% (annualized at 23.1%) since the Long-term Indicant signaled bull 817-weeks ago. Economic data is the primary influence on the Long-term Indicant. Recessions, deflation, and inflation have not been strong enough to signal bear since that bull signal. A link to the Long-term Indicant is below:

http://www.indicant.net/Members/Updates/LTI-Markets-DJIA/DJIA.htm

Quick/Short-term Indicant Stock Market Report - Summary

Quick-term Red Bulls: Nineteen of thirty; bullish bias remains, but weakening.

Quick-term Yellow Bears: Two; overall, the market remains to near maximum non-bearish support.

Short-term/Quick-term Non-Bearishness: Countering “sustainable” deep bearish ambition.

Force Vectors: Moving north on a quick-term basis. Potential robustness developing.

Vector Pressure: Supportive of bullish bias, but trending unfavorably to that bias.

Long-term Hold Positions: Solidly safe.

Current Quick-term Bias: Bullish

Overall Market Status: Bullish bias prevailing.

Profit Potential from Naked Options: Improving with increasing volatility.

Volume: Configurations remain in support of underlying bullish bias.

Comments from April 20, 2007

Both the NASDAQ and NYSE Indexes passed above their upper trading range limit. That means a new trading range is being established and is not an indication of immediate bias.

Quick-term/Short-term Indicant Stock Market Report Details

The Short-term Indicant signaled bull on May 21, 2007 for both the Dow and NASDAQ. They are down 1.0% and up 0.9%, respectively, since then. Configurations continue supporting bullish bias. Please read on. Click here to see the Short-term Indicant’s history.

As stated the past few days, both Indicant Volume Indicator’s were demonstrating an interest in a robust cycle. That embryonic configuration suggested little resistance to bearish aggression. That was because the increase in volume was concurrent with bearish behavior. That cycle did not mature enough to obviate the market’s directional intention. Holiday volume is kicking in now and a lethargic cycle is resuming. At this time, configurations continue to support bullish bias. In other words, the market is not about to charge off on a sustainable and deep bearish cycle.

Comment from June 28, 2007-Unfortunately, bullish responses are less in magnitude that their predecessor bearish expressions. This could result in the effect of a gentle drift to the southeast on the charts. Even with volatility, the market’s result should like a gentle drift.

SQI Report Card (Consolidated Short/Quick), Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the SQI is signaling hold for 29-ETF’s. They are up 75.1% (annualized at 31.4%) since their respective buy signals an average of 123.1-weeks ago. The SQI is avoiding one ETF. It is down 0.5% since its sell signal 4.0-weeks ago.

Short-term Indicant Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Short-term Indicant is signaling hold for 29-ETF’s. They are up an average of 79.7% (annualized 34.2%) since the STI signaled, buy, an average of 120.0-weeks ago. There is one avoid signal. That fund is down 0.5% since its sell signal 4.0-weeks ago.

Keep in mind, the Short-term Indicant is much more active in buying/selling than the Consolidated model. The Quick-term Indicant, which follows, is even more active.

Quick-term Report Card, Status, and Charts

There were no buy signals and no sell signals. Although there were no buy signals, the Quick-term Indicant is signaling hold for 28-ETF’s. They are up by an average of 21.7% (annualized at 21.4%) since the QTI signaled buy an average of 51.9-weeks ago. Although there were no sell signals, the Quick-term Indicant is avoiding two ETF’s. They are down by an average of 2.5% since their sell signals an average of 3.9-weeks ago.

Conflicts Between the Short-term and Quick-term Indicants

There is one conflict, whereby the Short-term Indicant and the Quick-term Indicant are in disagreement between hold and avoid status. The bias shift on August 15, 2006 remains in favor of the bull.

There are 86-hold signals out of a possible 90. There are four avoid signals with three related to the same fund. The bias remains in obvious support of the bull, although weakening.

Quick-term Indicant Bull/Bear Health Report

Two of the 30-ETF’s are below their respective bearish yellow curves. The average relative position of all thirty ETF’s is above bearish yellow by 8.3%. This remains configured in support of the market’s non-bearish posture. There is minimal support for sustainable bearish assertions.

Eighteen ETF’s are above their respective bullish red curves. As stated the past several days, there is no sustainability to recent bearish expressions at this time. This configuration solidly supports the underlying bullish bias, although weakening. As stated last Thursday, do not be surprised at immediate bearishness. There was bearishness on Friday, but the magnitude was mild and thus disappointing to those who short the market. All thirty ETF average positions are 0.4% above their bullish red curves.

At this time, configurations favor bearish spurt behavior.

Short-term Indicant Bull/Bear Health Report for ETF’s

None of the thirty ETF’s are contacting their breakout lines. As stated the past several months, the high concentration of breakout-contact since last August is solidly bullish. This repeated contact solidly supports the underlying bullish bias. Contact in forty-seven of the last sixty-two trading days remains supportive of bullish bias. An absence of contact in eight of the past eight trading days confirms an increasingly aggressive bear. However, the bull remains cyclically dominant.

The average distance from breakout contact is 3.6%. This remains in support of the bullish bias.

None of the ETF’s are contacting their respective breakdown lines. The average distance from the price and breakdown is 26.1%. This configuration provides tremendous non-bearish support, which has been the case since March 2003. There have been several bearish “spurts” since then with no sustainability or dynamic support. The probability of immediate contact remains low and thus a non-bearish bias is maintained on a short-term basis.

This attribute remains solidly non-bearish, regardless of recent bearish behavior.

ETF Force Vector Configurations

Only three of the thirty ETF Force Vectors continue toward bullish domains. The majority of this directional behavior suggests the bull is resting in the face of increasing bearish ambitions. As stated yesterday, the bearish cycle appears reversing, which should dampen bearish enthusiasm.

To understand potential financial opportunities, click here to learn to identify Robust Force Vectors. They are visible on the Quick-term Indicant charts.

ETF Force Vectors/Vector Pressure Crossings/Option Signals

Remember, the links contained herein are more visible when reading this on the website.

Click this sentence for Vector Pressure Option Signals. There were no option buy signals today. Last Thursday’s high number of put option buy signals will most likely did not manifest actual buys. A contrarian market movement was required for your deeply discounted offers to be accepted. That did not happen as the market synchronized to bearish expectations. The perfect configuration would have been to have a bullish stock market on Friday, followed by deep bearishness this coming Monday. Perfect configurations occur from time to time. So, do not despair.

Eighteen ETF Vector Pressures are in bullish domains. That is down by six from one week ago and down by eight since June 8. This is somewhat of a concern. The current configurations remain in support the Quick-term bullish bias shift from August 15, 2006, although favoring increasing bearish spurt activity.

As long as this attribute holds above fifteen within confines of other Quick-term attributes, bearish expressions are mere spurts, where there is no sustainability.

Make certain you sell naked options when the Force Vectors shift direction or within two days of the purchase, whichever occurs first. If you are unfamiliar with this, take the options tour.

Quick-term and Short-term Indicant Summary

Do not write covered call options while Vector Pressure is positive (bullish), which is the current configuration.

The Quick-term Bull remains in tact.

To familiarize yourself with viewing the market from an ETF perspective, click the following update links.

Quick-term ETF Options

Quick-term Indicant for ETF’s

Short-term Indicant for ETF’s

Consolidated Quick-term/Short-term Indicant for ETF’s

Click here to the report card, which is updated weekly, to link to related tours.

Links to the Short-term Indicant and Indicant Volume Indicator are below:

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

Indicant Conclusion

Bullish divergence was enjoyed last week. Although not very dynamic, it was positive response to the prior week’s bearish divergence, which was expected. The bearish spurts are currently more robust than recent bullish responses.

Vector Pressure continues to support the bullish bias. It has been doing that since August 15, 2006.

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

In addition, 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

07/01/07