March 27, 2005 Indicant.Net Weekly Update

Volume 03, Issue 4 ISSN 1526 6516 © The Indicant Stock Market Report

Are We in the Early Stage of a 1970’s Market – Part VI

February’s Consumer Price Index increased 3.0% on a year over a year basis. That is not bad. As long as it remains under 4.0%, the market will find tolerance on a fundamental basis. In other words, as long as the market perceives future CPI at less than 4.0%, bullish tolerance can be expected within the dynamics of the market. If the market anticipates the CPI moving above 4.0%, it will get extremely jittery and most likely start moving south. So far, high commodity prices and energy costs have not permeated the CPI.

The market will anticipate, though. It will not wait. Sometimes the market’s prognosis of the future is wrong. That occurs when you see “market fluttering.” Sharp bounces north and south in relatively short periods is referred to as market fluttering.

Let’s review some economic fundamentals. Interest rates continue to rise. Although they remain at low levels, the market at some point will not tolerate the direction. There is a threshold of interest rates that will not be tolerated. Bears have historically been aroused with a combination of 4% inflation and 4% interest rates.

Right now, inflation is at 3% as of the February 2005 report. The federal funds discount rate is at 3.75%. The combination amounts to 6.75%, which are a few points shy of the nastiness that usually accompanies the combined 8.0%. As you can see from the below link, rates are still low, when compared to recent history.

http://www.indicant.net/Members/Updates/Economic/E06.htm

Commodity prices fell last week. That is the good news. At least they have paused. It is unlikely they will fall, which is what the equity bull would love to see. A few of the critical commodities are displayed on the following link:

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

As you can see, their current trend is bullish for them, but not bullish for equities. The investment pasture cannot be full of bulls. Bulls do not like sharing territory. There is room for only a few. The bull in commodities has prevented the equity bull from continued growth. The equity bull has bowed to the dominance of the commodity bulls.

Gold exceeded $800 per troy ounce in the late 1970’s. If the current trend continues, gold will hit that price in early 2009 with a data regression from 1995. A regression and extrapolation from its recent bottom in 2000 has it at $800 per troy ounce in mid-2007. The Indicant does not forecast and this is definitely not a forecast. Although various regression models offer a basis in logic, they still rely on an exact repeat of their historical error rates for an accurate prognosis. Each historical, new data point prompts a revision from the last prognosis. All things requiring data points, more or less move cyclically (sinusoidal waves) and unfortunately, few provide exact symmetry from one sinusoidal wave to the next one. It is amazing how many use those statistically based techniques and act on them. They are typically no better than blind dart throwing at predicting a future outcome.

However, the current trends and cyclical behavior should not go unnoticed. There is an old saying that remains true. “Don’t buck the trend.” Just when the majority is in solid belief that the current trend will remain so, the trend reverses. This happened in the late 1990’s when the NASDAQ peaked. Just when the disgruntled finally sold their losses, if they could, the market bottomed in 2002. However, the market has been in a sideways pattern for over a year, except for the annual fourth quarter bullish spurt last year.

The 2002-2003 bull in the stock market was significantly aroused when the 3-Month T-Bill was under 1.0%. The bull was not necessarily excited as interest rates plummeted in 2001 and 2002. Although that was a favorable direction to the bull’s desire, there is seldom a 1:1 correlation between the market and extraneous fundamental events. That is because human emotion is one of the major market influences. However, statistically speaking, the market really enjoyed supporting bullish enthusiasm when the T-Bill yielded less than 1.0%. Also, CD’s with similarly low yields prompted many to get back into the market in late 2002 and early 2003, although not a majority. Institutions and fund managers mostly ignited that big bull move in late 2002 and early 2003. They were buying from the late individual sellers, who were feeling victimized by the great bear leg of 2000-2002. Of course, you were also buying, while the majority was continuing to sell.

http://www.indicant.net/Members/Updates/Economic/E07.htm

Productivity continues to depress the rising commodity price influence on inflation. Productivity’s influence use to be limited to western industries. Now, the whole world is participating. That is a new and evolving variable. The bull in the stock market likes productivity. It will rise, if enough productivity improvement can be unleashed to offset rising commodity prices. Unfortunately, it is unlikely that will occur fast enough to stave off the bear in the stock market. Long-term bullishness should prevail, but the recent rise in oil prices will require unprecedented productivity improvements in the short-run to stifle inflationary behavior.

The stock market will attempt to anticipate all these dynamics. It may be accurate and it may not be accurate in its assessment of future economic activity. Regardless, it will move on its prognosis. The various Indicant models will monitor that movement. Bears/bulls/buy/sell signals will ensue accordingly. The Indicant will not discriminate any differentials from a 5% bear to a 50% bear. A bear is a bear.

Weekly Buy/Sell Summary

The Mid-term Indicant generated one buy signal and three sell signals for stocks and funds.

In addition to the sell signals, the Mid-term Indicant is avoiding 84 stocks and funds of the 320 tracked by the Indicant. The avoided stocks and funds are down an average of 28.6% since the Mid-term Indicant signaled sell an average of 52.3 weeks ago.

There were 43 stocks and funds avoided at this time last year. The avoided stocks and funds one year ago were down an average of 24.7% since their respective sell signals an average of 39.3 weeks earlier. Two years ago, on March 29, 2003, the Mid-term Indicant was avoiding 36 stocks and funds that were down an average of 29.7% since their respective sell signals an average of 27.5 weeks earlier. There were 18 sell signals and one buy signal two years ago. The second buying spree was now complete with some jittery profit taking at this time two years ago.

In addition to the buy signal this weekend, the Mid-term Indicant is signaling hold for 232 of the 320 stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 85.8%. That annualizes to 59.3%, which is down from 124.1% reported on June 7, 2003, but up from 50.2% reported over two years ago on February 15, 2003. The Mid-term Indicant has been signaling hold for these 232 stocks and funds for an average of 75.3 weeks.

One year ago, the Mid-term Indicant was holding 249 stocks and funds out of the 296 tracked at that time for an average of 48.7 weeks. They were up 71.0% (annualized at 75.8%). The Mid-term Indicant was signaling hold for 241 stocks and funds two years ago on March 22, 2003. They were up by an average of 18.3% (annualized at 75.6%) since their respective buy signals an average of 12.6 weeks earlier.

Secular Market Blend

This section is a repeat from the last several months with a few modifications, reflecting recent secular influences. The current Mid-term Bull market and buying barrage in late 2002 followed the predicted market bottom in 2002. The mid-term presidential election year phenomenon was consistent with history. Even more impressive was how the market synchronized with near perfection to normal seasonality in 2002.

The Dow30 found bottom on October 9, 2002 at 7286.27. The NASDAQ found bottom on the same day at 1114.11. 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.

Some of you recall the Short-term Indicant Bear for the NASDAQ 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 the tech stocks have on the economy. Remember, real economic wealth is delivered in only three ways; manufacturing, agriculture, and extraction. All other industries are merely transfer agents of wealth. The only positive political influence on the economy is to undo its prior damage.

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 you recall how the market did not synchronize with the heart and soul of bullish seasonality from November 2002 through February 2003. 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 during bearish seasonality during most of 2003. The market continued moving north during that time, contrary to historical 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 year, 2004, was consistent with normal bearish seasonality. Unfortunately, bearish expressions started ahead of schedule in 2004. However, the bullish expressions, which solidified in October 2004, synchronized beautifully with historical standards with a bullish outburst. The Quick-term Indicant accurately revealed an early start to bullish seasonality in late 2004. The early part of December was not consistent with the normal Santa Clause rally. However, bullish expressions resumed in late December 2004. Some quick-term attributes suggested there would be a Santa Clause rally and that is exactly what happened. The market is still elevated as a function of the typical fourth quarter rally in 2004. Unfortunately, the Quick-term Bear that plagues normal bullish seasonality for the second consecutive year is challenging this elevated position. Bullish seasonality ends on April 30, 2005.

Although not surprising, 2005 began with unfavorable performance to bullish seasonality standards. The Quick-term Indicant signaled bear in early January 2005. Bearish expressions followed. At first, these bearish expressions were mild, but seven weeks ago, bearish behavior revealed greater aggression. However, that aggression was muted with a bullish response. That bullish response was weak but possessed enough bullish steam to thwart aggressive bearish behavior.

All the Quick-term attributes remain biased with bearish tendencies even though the bull demonstrated significant resistance to bearish ambition. That resistance weakened the past three weeks. As stated the past few weeks, there are some quick-term attributes shifting in support of even more bearish expressions on a quick-term basis, but the Mid-term Bull remains solid.

The presidential post election year is, historically, the most bearish year on the four-year presidential election cycle. Like all things, there are exceptions to historical normalcy. As this year progresses, the various Indicant models will advise if 2005 is an exception or normal. So far, this year appears normal; that is bearish. The Short-term Indicant continues signaling bear. The Mid-term and Long-term Indicant models continue to signal bull. The short cycles are dominating now, but your hold positions still appear safe.

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 continues recommending a stop loss of 8% because of the Quick-term Bear. The Quick-term Indicant’s configuration is enough to outweigh bullish seasonality.

If you are up by 50% or more you may find it advantageous to set your stop-loss at 15% from your current hold position. If you sold a stock on the stop loss and the Indicant continues to signal hold, do not buy the stock unless the Quick-term Indicant is signaling bull.

Use a 10% trailing stop loss or the yellow or green values you will find on the tables. 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. There are some instances where stocks rise during bear markets due to legitimate fundamental reasons.

Stock and Fund Update

Click the following link to see sorted performance of stocks and funds with hold/avoid signals. In the past, we included them 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.

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

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 update 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

Divergence versus Convergence

The market has expressed a bearish surge of convergence the past three weeks. That is increasing bearish intensity. If this convergent behavior continues, the bear will accelerate its influence on the market’s direction. Even the Energy Sector expressed bearishness for three consecutive weeks.

As stated the past three weeks, your “new money” behavior should be consistent with a bearish bias, even though the Mid-term and Long-term Indicant’s continue to signal bull.

Economic Conditions – Inflation, Currency, Interest Rates

Rising commodity prices took a breather last week. However, weekly and daily aberrations do not form a new trend or even a cyclical adjustment. Commodity prices continue to be directionally positioned in support of a stock market bearish bias.

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

As stated the past three weeks and originating last August, current cyclical behavior appears adjusting to trends similar to that of the 1970’s. The recent rise in commodities is not passive. It is arousing the bear with the potential of significant emotion. It is bearish emotion that can yield swift and significant punishment to the passive, long-term investor. As stated the past three weeks, the bull can contribute to the least-worse case of a meandering market. However, the strongest of bulls cannot standup to excessive inflation or deflation or extremely high interest rates. A bull traditionally does not survive a combination of inflation/interest rates in excess of 8/0%. Right now, the threat is inflation and its serious nature is growing. Greenspan is adding some potential bearish fuel with his steady diet of “measured” rate increases.

The U.S. Dollar remains weak, but continues to remain above cyclical minimums. The dollar will strengthen provided Greenspan continues increasing interest rates. A strengthening dollar is generally anti-inflationary.

http://www.indicant.net/Members/Updates/Economic/E01.htm

As stated the last few weeks, the looming threat in the short-term is Greenspan’s interpretation of the skyrocketing commodity prices. That alone can kill the current Mid-term Bull markets and set off profound bearish behavior.

http://www.indicant.net/Members/Updates/Economic/E07.htm

This paragraph remains unchanged from the past seventeen weeks with a few modifications. Interest rates continue their rise, but still from historically low levels. Right now, the stock market is not being bothered by this unfavorable direction on a mid-term basis, while at the same time; equities will not take their suspicious eye off it. The bearish bias by the Quick-term Indicant may be an early indication of the market’s intolerance to these unfavorable trends. There is some point where equities will not like the “position” of interest rates if Greenspan continues his northward trek. It is not uncommon to over-cool the economy in post election years, which is now underway.

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

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 75.2% one-hundred and forty-four weeks ago since the MTI buy signal in April 2001. One-hundred and thirty-seven weeks ago, it closed up 30.1%. Last week it closed up 137.3%, which is higher than the 75.9% reported 88-weeks ago. The current annualized growth rate since the April 13, 2001 buy signal is 34.3%, which is significantly higher than 23.1% reported 88 weeks ago. This fund is up from its most recent peak on December 5, 2003 when it was up 117.3%. After moving north for ten consecutive weeks, this fund took it on the chin last week with a deep drop.

The Fidelity Gold Fund #28 is up 5.9% (annualized at 9.8%) since the Mid-term Indicant signaled buy on August 20, 2004. The last buy/sell cycle was from December 7, 2001 to April 30, 2004 resulted in a 52.9% gross profit. As stated the past several months, if Greenspan gets aggressive in his fight against inflation, this fund will most likely not provide the nice profit it did on the last buy/sell cycle. This fund also fell sharply last week.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 178.6% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 67.5%. Vanguard Energy #18, VGENX, is up 90.8% (annualized at 45.4%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 58.7% (annualized at 44.5%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 70.0% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 43.0%.

All of the above funds fell sharply last week. That was due to mostly profit-taking and some “perceived” shifts in fundamentals.

The Gold Index is up 1.2% since the Mid-term Indicant signaled bull on July 9, 2004. This index has been flat for three quarters of a year. This fund also fell sharply last week in unison with the fall in commodity prices.

As repeatedly asked, is this the 1970’s all over again? The remainder of this paragraph will remain unchanged until such time conditions change. So far, it does not look that way, but increasing bullish expressions in the energy sector will lead to more bearish expressions in general equity markets. This may continue in this presidential post election year. The political system is not sensitive to democratic desires during lame-duck presidencies. Again, forecasting the market is okay for hallway conversations, but never give your broker instructions based on a forecast. The Indicant will keep you posted on the market’s cyclical and trend inclinations. There is definite behavior supporting a 1970’s type of theme.

These funds and the gold and silver index should convey the market’s perception of terrorism, inflation, and the economy. As long as they are in solid hold/bull positions, there remains some pessimism regarding the future of the economy.

Quick-term and Short-term Indicant Update

The Quick-term Indicant Bear that was born on January 4, 2005 has now survived for over thirteen weeks. As stated the past few weeks, that is a long period of survival in the midst of the heart and soul of bullish seasonality. Bullish resistance to this quick-term bear occurred when the indices approached the bearish yellow curve. That was a favorable response with respect to your hold positions. The longer this Quick-term Bear survives the better chance for greater breadth than normal Quick-term bears in Mid-term Bull markets. That does not necessarily mean this quick-term bear will have significant magnitude or depth. However, a bear is a bear, regardless of depth. It is impossible to project magnitude of bears. That is why it is better to avoid them altogether.

The eight major indices are down an average of 1.5% since the Quick-term Indicant signaled bear on January 4, 2005. Six of the eight are below their respective bearish yellow curves. Although they may not crash, continued lingering below bearish yellow reduces the probability of bullish resistance to bearish dominance.

Most quick-term bears do not survive this long during bullish seasonality. This quick-term bear was on the verge of expiration seven weeks ago, but the potential burgeoning bull expended too much energy preventing complete bearish dominance. There is simply not enough bullish energy for a new Quick-term Bull to dominate the market at this time.

Read the daily emails for more about the Quick-term Indicant. It is still a Quick-term Bear.

Please review the daily reports for more details regarding the Quick-term Indicant.

To view the Quick-term Indicant charts, please click the following hyperlink:

http://www.indicant.net/Members/Updates/STI-Mkts/QT.htm

The NYSE Indicant Volume Indicator is biased in support of continuing bearish expressions on a quick-term basis. The NASDAQ Indicant Volume Indicator is expressing a lethargic pattern which is not favorable in support of any bullish inclinations at this time.

http://www.indicant.net/Members/Updates/STI-Mkts/IVI.htm

The Dow is down 0.3% since the Short-term Indicant signaled bear on January 20, 2005. The NASDAQ is down 4.3% since the Short-term Indicant signaled bear on January 11, 2005. Both indices are Short-term Bears.

To view the Short-term Indicant charts, please click the following hyperlink:

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

A link to the Dow’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20DJIA1995-2002.htm

A link to the NASDAQ’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20NAS1995-2002.htm

Perspectives

This paragraph is unchanged from the past five weeks. The indices have retracted from their bullish breakout lines. They are not yet threatening their respective breakdown lines. Although there is a Quick-term Indicant Bear in progress, the perspectives reveal no deep bears on the immediate horizon. The small caps continue resisting bearish influences. They have recently been engaging its breakout line, which is bullish for that particular group of stocks. The Quick-term modeling requires consistent signaling and thus cannot signal bull even though one of the indices is expressing bullish behavior in the face of the Quick-term Bear.

Read your daily emails.

To view the Perspective Charts (Quick-term Indicant, please click the following.

http://www.indicant.net/Members/Updates/STI-Mkts/QTP.htm

Refer to the daily reports for more information about the Quick-term Indicant.

For more information about the Quick-term Indicant, refer to last week’s daily reports.

Mid-term Indicant Positions - Major U.S. Market Indices

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

The eight major indices are up an average of 25.4% since the Mid-term Indicant signaled bull an average of 74.8 weeks ago. That annualizes to 17.6%. The Dow Transports is the strongest bull. It is up 65.4% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Jones Industrial Average is up 22.5% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Composite is up 41.1% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Utilities is up 49.03% since the Mid-term Indicant bull signal on August 16, 2003.

Three of the eight major indices continue as red bulls, which is down from six two weeks ago. Just when the survivability of these bulls was in question eight weeks ago, they responded with a bullish fervor in the face of the Quick-term Bear. That is a testament to the strength of this Mid-term Bull market. However, as stated the last few weeks, they are being threatened with the potential of rising inflation and interest rates.

To view Mid-term Indicant charts for U.S. Market Indices, please click the following link.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20MTI-Mkts-US.htm

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

Mid-term Indicant Positions - International Markets

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

Although there were no new bull signals, twenty-one of the twenty-two foreign indexes tracked by the Indicant are Mid-term Bulls. They are up an average of 109.4% since the Mid-term Indicant signaled bull an average of 105.7 weeks ago for an annualized gain of 53.8%, which is less than the 72.9% reported 92 weeks ago. International indices are down significantly the past two weeks after being up for seven consecutive weeks.

The lone bear is down 2.8% since the Mid-term Indicant signaled bear 11-weeks ago.

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

March 20, 2005 Indicant.Net Weekly Update

Volume 03, Issue 3 ISSN 1526 6516 © The Indicant Stock Market Report

Dear Indicant Members:

This Week’s Report

Are We in the Early Stage of a 1970’s Market – Part V

Fundamental shifts are occurring. Worldwide political leadership the past five-hundred or so years has been forced to hold the majority’s dissatisfaction at a minimum. Periodically, some of the crazy political leaders turn crazier with their twisted brains and actually believe they can ruthlessly rule with military might. The problem with that is the military consists of humans who resist killing their cousins. Nevertheless, the crazy are well, just simply crazy, and the only solution is their demise, which always happens. The majority must be happy, more than not, for any political body to survive.

Although the reality of craziness is harsh at time, reality is reality. It exerts itself on all existence regardless of individual perceptions of what should be. There is some recent empirical evidence that the world’s political leaders have adopted a policy that will decrease happiness in the short-run in an effort to maintain their power in the long run. There was significant bearish convergence last week on an international scale. The Saudi’s kingdom, the Chinese dictatorships, and Western political leaders seem bent on helping the phenomenon of the post election year cycle conform to historical standards. That is bearish.

Political leaders around the world are a close, regardless of their political rhetoric. When they meet and talk, they know the intention of the other – that is to rule their niche constituencies. In their respective public forums, they will criticize their political brethren on the other side of the planet, but their interests are as common as that of Henry Ford and Harvey Firestone. They know what drives each other – that is maintain power and rule over their constituents with military might. That is true in all civilizations, including western societies.

Since the famous Scott, Wallace, portrayed in the movie Brave Heart, where the common person demanded individual happiness and freedom, political leaders have slowly learned that the majority must be left alone. Political leaders will raise taxes, which is their source of power, to the point of open and loud resistance. Over a long period, they have learned to disguise tax. They can tax the populace indirectly, by creating fake money. That leads to inflation. That inflationary threat expands when happiness pinnacles to the point where supply outstrips demand.

Western political leaders have been critical of communist political leaders for about one-hundred years. That criticism had nothing to do with the fall of communism. Experiments in communism fell because the majority could not see happiness on the horizon. They could only see saddened livelihoods of their parents and grandparents continuing to their old age. Therefore, communism is collapsing because of the inherent stupidity that 90% of the populace would live in poverty, while 10% would live like kings. Craziness will erupt from time to time, as there are some who simply cannot resist telling everyone else how they should behave.

International political leadership, for the most part, prefers political stability around the world. That helps stabilize and protects their individual comfort zones. Political leaders have the exact same needs as the common people; food, shelter, clothing, and the latest $600 driver in their golf bag. They are no different, but they do not know that. Most think they have been chosen to lead. The plumber who fixes your faucet does not need a leader. All he needs is his toolbox and a ticket to invoice you with. But the political leader thinks the plumber needs to be led by him or her.

Let’s get to the economics of all this. The Chinese stock market fell sharply last week. It had recently been rising since the Mid-term Indicant signaled bear a few weeks ago. However, it fell last week putting it back in a losing position since the bear signal.

http://www.indicant.net/Members/Updates/MTI-Mkts-International/IM02.htm#08

A few days ago, the Saudi Kingdom suggested OPEC should increase output to prevent economic instability. That contributed to bearish expression in the petroleum sector. That also helped trigger bearish responses from petroleum rich countries, such as Venezuela. That is not unusual with the type of commentary infiltrating the media, but nearly all of the international indices fell last week.

Skyrocketing oil prices logically support major market indices around the globe. Even the petroleum sector has been expressing bearish behavior the past few days, but mild in comparison. Although skyrocketing oil prices is normally good news to those companies serving the petroleum industry, nothing survives economic collapse. An economic collapse would result in diminished demand for petroleum based products. The Saudi’s understand this economic principle and thus their desire to flatten out prices for oil.

Either the political leadership must cool inflation and economic behavior, or their replacements will. Political leaders, by their nature, do not like the threat of their replacements fixing things. They despise the very thought of being replaced. So, their every action is dedicated toward maintain happiness by the majority. They know that the majority is fairly ignorant about the dynamics of the economy, but they do know they get blamed when it sours. Westerns always vote their pocket books on the day of the election. There is no major election on the horizon.

The equity markets contribute significantly to the economy or at the very least emulate the health of the economy. Political leaders want stability when the majority is happy. That stability is being threatened with record high oil prices. The only way to cool those prices is to increase supply to match or even exceed demand.

The Producer Price Index has an unfavorable trend to bull markets. Click the following link to review this.

http://www.indicant.net/Members/Updates/Economic/E-PPI.htm

Notice the green lagging trend line. Notice how the market moved north in the past when the green line was moving south. Notice how the market topped when it started moving north. Notice how the market was bullish on the next move to the south. However, notice how the unfavorable trend resumed late last year that paralleled the stock market’s move to the north. 2004’s meandering market was concluded with the typical seasonal surge in the fourth quarter. Since then, 2005 has been meandering.

The same is true for the Consumer Price Index.

http://www.indicant.net/Members/Updates/Economic/E-CPI.htm

The markets will never completely provide analysts with simple if-then logic. The market attempts to anticipate and thus various phenomena that influence it do not parallel one another in perfect timing harmony. Sometimes lead-time offsets are required. Also, much of the Dow’s rise was due to Exxon rising stock price, only, as opposed to a healthy rise in the other constituents of the Dow30.

Overall, the markets around the world, including all sectors expressed bearish convergence this past week. That, indeed, is ominously bearish. This is to be viewed as a strategic thought; not a tactical thought. There is no need to rush into selling everything. Only sell those items that are recommended to sell by the Indicant or those that fall below your stop loss. For example, this weekend’s tactical decision is to sell Mutual Fund #45, Fidelity’s Home Finance.

http://www.indicant.net/Members/Updates/MTI-Mutual%20Funds/MF08.htm#45

As you can see, there is no point holding a fund that is expressing the potential for a tumultuous fall in price. Fundamentally, this makes sense, although disappointing that the market is taking on the appearance of suggesting a nasty bear in the far not too distant future. Just take the 15% gain you got from the March 22, 2003 buy signal and convert to cash right now on this particular fund. Watch the funds. Most of them still have hold signals since March 2003. However, those hold signals are threatened.

Although all of the other funds are holding up well, they are not free from bearish behavior. It was nearly years ago when the Mid-term Indicant generated a tremendous number of buy signals in its second wave of the buying spree. This Mid-term Bull is fairly old when compared to the average life cycle of a Mid-term Bull.

The idea here is to adopt strategies. That means you do nothing tactical, but get used to the idea the current Mid-term Bull market is being threatened. The combination of political stupidity and economic dynamics is the threat. Simply wait for the signals for your tactical actions. Keep your stop losses up to date.

Weekly Buy/Sell Summary

The Mid-term Indicant generated no buy signals and eight sell signals for stocks and funds.

In addition to the sell signals, the Mid-term Indicant is avoiding 77 stocks and funds of the 320 tracked by the Indicant. The avoided stocks and funds are down an average of 28.7% since the Mid-term Indicant signaled sell an average of 52.6 weeks ago.

There were only 30 stocks and funds avoided at this time last year. The avoided stocks and funds one year ago were down an average of 25.4% since their respective sell signals an average of 38.7 weeks earlier. Two years ago, on March 22, 2003, the Mid-term Indicant was avoiding 36 stocks and funds that were down an average of 28.3% since their respective sell signals an average of 26.6 weeks earlier. There were no sell signals and 119 buy signals two years ago. This was the second wave buying spree two years ago.

Although there were no buy signals this weekend, the Mid-term Indicant is signaling hold for 235 of the 320 stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 88.6%. That annualizes to 62.0%, which is down from 124.1% reported on June 7, 2003, but up from 50.2% reported over two years ago on February 15, 2003. The Mid-term Indicant has been signaling hold for these 235 stocks and funds for an average of 74.4 weeks.

One year ago, the Mid-term Indicant was holding 249 stocks and funds out of the 296 tracked at that time for an average of 47.8 weeks. They were up 71.1% (annualized at 77.4%). The Mid-term Indicant was signaling hold for 141 stocks and funds two years ago on March 22, 2003. They were up by an average of 29.8% (annualized at 74.8%) since their respective buy signals an average of 20.7 weeks earlier. Again, there were 119 buy signals for stocks and funds two years ago.

Secular Market Blend

This section is a repeat from the last several months with a few modifications, reflecting recent secular influences. The current Mid-term Bull market and buying barrage in late 2002 followed the predicted market bottom in 2002. The mid-term presidential election year phenomenon was consistent with history. Even more impressive was how the market synchronized with near perfection to normal seasonality in 2002.

The Dow30 found bottom on October 9, 2002 at 7286.27. The NASDAQ found bottom on the same day at 1114.11. 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.

Some of you recall the Short-term Indicant Bear for the NASDAQ 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 the tech stocks have on the economy. Remember, real economic wealth is delivered in only three ways; manufacturing, agriculture, and extraction. All other industries are merely transfer agents of wealth. The only positive political influence on the economy is to undo its prior damage.

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 proper frame of reference.

You will notice many of the mutual fund buy signals occurred in March 2003. Many of you recall how the market did not synchronize with the heart and soul of bullish seasonality from November 2002 through February 2003. 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 during bearish seasonality during most of 2003. The market continued moving north during that time, contrary to historical 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 year, 2004, was consistent with normal bearish seasonality. Unfortunately, bearish expressions started ahead of schedule in 2004. However, the bullish expressions, which solidified in October 2004, synchronized beautifully with historical standards with a bullish outburst. The Quick-term Indicant accurately revealed an early start to bullish seasonality in late 2004. The early part of December was not consistent with the normal Santa Clause rally. However, bullish expressions resumed in late December 2004. Some quick-term attributes suggested there would be a Santa Clause rally and that is exactly what happened. The market is still elevated as a function of the typical fourth quarter rally in 2004. Unfortunately, the Quick-term Bear that plagues normal bullish seasonality for the second consecutive year is challenging this elevated position.

Although not surprising, 2005 began with unfavorable performance to bullish seasonality standards. The Quick-term Indicant signaled bear in early January 2005. Bearish expressions followed. At first, these bearish expressions were mild, but six weeks ago, bearish behavior revealed greater aggression. However, that aggression was muted with a bullish response. That bullish response was weak but possessed enough bullish steam to thwart aggressive bearish behavior. All the Quick-term attributes remain biased with bearish tendencies even though the bull demonstrated significant resistance to bearish ambition. That resistance weakened the past two weeks. As stated the past few weeks, there are some quick-term attributes shifting in support of even more bearish expressions on a quick-term basis, but the Mid-term Bull remains solid.

The presidential post election year is, historically, the most bearish year on the four-year presidential election cycle. Like all things, there are exceptions to historical normalcy. As this year progresses, the various Indicant models will advise if 2005 is an exception or normal. So far, this year appears normal; that is bearish. The Short-term Indicant continues signaling bear. The Mid-term and Long-term Indicant models continue to signal bull. The short cycles are dominating now, but your hold positions still appear safe.

1970-type fundamentals were increasingly apparent this past week with oil stocks rising rapidly while all other sectors continued their meandering ways.

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 continues recommending a stop loss of 8% because of the Quick-term Bear. The Quick-term Indicant’s configuration is enough to outweigh bullish seasonality.

If you are up by 50% or more you may find it advantageous to set your stop-loss at 15% from your current hold position. If you sold a stock on the stop loss and the Indicant continues to signal hold, do not buy the stock unless the Quick-term Indicant is signaling bull.

Use a 10% trailing stop loss or the yellow or green values you will find on the tables. 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. There are some instances where stocks rise during bear markets due to legitimate fundamental reasons.

Stock and Fund Update

Click the following link to see sorted performance of stocks and funds with hold/avoid signals. In the past, we included them 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.

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

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 update 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

Divergence versus Convergence

The market has expressed a bearish surge of convergence the past two weeks. That is increasing bearish intensity. If this convergent behavior continues, the bear will accelerate its influence on the market’s direction. Even the Energy Sector expressed bearishness for two consecutive weeks, but mostly due to some short-term profit-taking and contrarian behavior.

As stated the past two weeks, your “new money” behavior should be consistent with a bearish bias, even though several Indicant models continue to signal bull.

Economic Conditions – Inflation, Currency, Interest Rates

There is nothing new here. Commodity prices continue skyrocketing. The equity markets are showing surprising resiliency by not turning into a dynamic bear. If commodity prices continue to rise and impregnate the Consumer Price Index, rest assured the bear will be delighted with significant gusto. Click the following link to view major commodities.

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

As stated the past two weeks, current cyclical behavior appears adjusting to trends similar to that of the 1970’s. The recent rise in commodities is not passive. It is arousing the bear with the potential of significant emotion. It is bearish emotion that can yield swift and significant punishment to the passive, long-term investor. As stated the past two weeks, the bull can contribute to the least-worse case of a meandering market. However, the strongest of bulls cannot standup to excessive inflation or deflation. Right now, the threat is inflation and its serious nature is growing.

The U.S. Dollar remains weak, but continues to remain above cyclical minimums. The dollar will strengthen provided Greenspan continues increasing interest rates. A strengthening dollar is generally anti-inflationary.

http://www.indicant.net/Members/Updates/Economic/E01.htm

As stated the last few weeks, the looming threat in the short-term is Greenspan’s interpretation of the skyrocketing commodity prices. That alone can kill the current Mid-term Bull markets and set off profound bearish behavior.

http://www.indicant.net/Members/Updates/Economic/E07.htm

This paragraph remains unchanged from the past sixteen weeks with a few modifications. Interest rates continue their rise, but still from historically low levels. Right now, the stock market is not being bothered by this unfavorable direction on a mid-term basis, while at the same time; equities will not take their suspicious eye off it. The recent bearish bias by the Quick-term Indicant may be an early indication of the market’s intolerance to these unfavorable trends. There is some point where equities will not like the “position” of interest rates if Greenspan continues his northward trek. It is not uncommon to over-cool the economy in post election years, which is now underway.

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

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 75.2% one-hundred and forty-three weeks ago since the MTI buy signal in April 2001. One-hundred and thirty-six weeks ago, it closed up 30.1%. Last week it closed up 152.1%, which is higher than the 75.9% reported 87-weeks ago. The current annualized growth rate since the April 13, 2001 buy signal is 38.1%, which is significantly higher than 23.1% reported 87 weeks ago. This fund is up from its most recent peak on December 5, 2003 when it was up 117.3%. This fund moved north last week for the tenth week in a row. It has the 1970’s look to it.

The Fidelity Gold Fund #28 is up 14.5% (annualized at 24.8%) since the Mid-term Indicant signaled buy on August 20, 2004. The last buy/sell cycle was from December 7, 2001 to April 30, 2004 resulted in a 52.9% gross profit. As stated the past several months, if Greenspan gets aggressive in his fight against inflation, this fund will most likely not provide the nice profit it did on the last buy/sell cycle. After moving north the past five weeks, it turned south last week. It also expresses a 1970’s type of behavior.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 190.7% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 72.7%. Vanguard Energy #18, VGENX, is up 98.5% (annualized at 49.7%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 63.2% (annualized at 48.6%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 76.2% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 47.3%.

All of these funds were up last week after falling slightly last week.

The Gold Index is up 9.5% since the Mid-term Indicant signaled bull on July 9, 2004. This index has been flat for three quarters of a year. It is uncommon for this index to not express bullish behavior with rising oil prices. However, the high oil prices have not yet significantly penetrated the consumer price index. When that happens, the gold index and other gold related securities should move to the north.

As repeatedly asked, is this the 1970’s all over again? The remainder of this paragraph will remain unchanged until such time conditions change. So far, it does not look that way, but increasing bullish expressions in the energy sector will lead to more bearish expressions in general equity markets. This may continue in this presidential post election year. The political system is not sensitive to democratic desires during lame-duck presidencies. Again, forecasting the market is okay for hallway conversations, but never give your broker instructions based on a forecast. The Indicant will keep you posted on the market’s cyclical and trend inclinations. There is definite behavior supporting a 1970’s type of theme.

These funds and the gold and silver index should convey the market’s perception of terrorism, inflation, and the economy. As long as they are in solid hold/bull positions, there remains some pessimism regarding the future of the economy.

Quick-term and Short-term Indicant Update

The Quick-term Indicant Bear that was born on January 4, 2005 has now survived for about eleven weeks. As stated the past few weeks, that is a long period of survival in the midst of the heart and soul of bullish seasonality. It was met with bullish resistance when the indices approached the bearish yellow curve. That was a favorable response with respect to your hold positions. The longer this Quick-term Bear survives the better chance for greater breadth than normal Quick-term bears in Mid-term Bull markets. This will continue to be monitored until it expires. Most quick-term bears do not survive too long during bullish seasonality. This quick-term bear was on the verge of expiration six weeks ago, but the potential burgeoning bull expended too much energy preventing complete bearish dominance. There is simply not enough bullish energy for a new Quick-term Bull to dominate the market at this time.

Read the daily emails for more about the Quick-term Indicant. It is still a Quick-term Bear.

Please review the daily reports for more details regarding the Quick-term Indicant.

To view the Quick-term Indicant charts, please click the following hyperlink:

http://www.indicant.net/Members/Updates/STI-Mkts/QT.htm

The NASDAQ Indicant Volume Indicator continues declining with recent bullish and bearish expressions. This is not favorable to an expectation of strong bullish sentiment. Recent developments are beginning to no longer support meandering behavior. The bias now favors greater bearish tendencies. The declining Indicant Volume Indicators are an indication there is no strong support for a long-lasting Quick-term Bear. However, keep your eye on this. The Quick-term attributes can change quickly. Prior to this shift in direction there was increasing bearish sentiment on a quick-term basis, but that has since been dampened. Friday’s bullish behavior helped solidify your hold positions.

http://www.indicant.net/Members/Updates/STI-Mkts/IVI.htm

The Dow is now up 1.5% since the Short-term Indicant signaled bear on January 20, 2005. The NASDAQ is down 3.5% since the Short-term Indicant signaled bear on January 11, 2005. Both indices are Short-term Bears. Again, too much bullish energy was consumed to fend off bearish dominance. Most of the Dow’s rise is due to Exxon’s meteoric increase in stock price. The Dows’ expressions of bullish behavior is misleading.

To view the Short-term Indicant charts, please click the following hyperlink:

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

A link to the Dow’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20DJIA1995-2002.htm

A link to the NASDAQ’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20NAS1995-2002.htm

Perspectives

This paragraph is unchanged from the past four weeks. The indices have retracted from their bullish breakout lines. They are not yet threatening their respective breakdown lines. Although there is a Quick-term Indicant Bear in progress, the perspectives reveal no deep bears on the immediate horizon. The small caps continue resisting bearish influences. They have recently been engaging its breakout line, which is bullish for that particular group of stocks. The Quick-term modeling requires consistent signaling and thus cannot signal bull even though one of the indices is expressing bullish behavior in the face of the Quick-term Bear.

Read your daily emails.

To view the Perspective Charts (Quick-term Indicant, please click the following.

http://www.indicant.net/Members/Updates/STI-Mkts/QTP.htm

Refer to the daily reports for more information about the Quick-term Indicant.

For more information about the Quick-term Indicant, refer to last week’s daily reports.

Mid-term Indicant Positions - Major U.S. Market Indices

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

The eight major indices are up an average of 26.9% since the Mid-term Indicant signaled bull an average of 73.8 weeks ago. That annualizes to 18.9%. The Dow Transports is the strongest bull. It is up 65.7% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Jones Industrial Average is up 24.7% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Composite is up 42.8% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Utilities is up 51.3% since the Mid-term Indicant bull signal on August 16, 2003.

Three of the eight major indices continue as red bulls, which is down from six last week. Just when the survivability of these bulls were in question seven weeks ago, they responded with a bullish fervor in the face of the Quick-term Bear. Again, that is a testament to the strength of this Mid-term Bull market. However, as stated the last few weeks, they are being threatened with the potential of rising inflation and interest rates.

To view Mid-term Indicant charts for U.S. Market Indices, please click the following link.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20MTI-Mkts-US.htm

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

Mid-term Indicant Positions - International Markets

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

Although there were no new bull signals, twenty-one of the twenty-two foreign indexes tracked by the Indicant are Mid-term Bulls. They are up an average of 112.4% since the Mid-term Indicant signaled bull an average of 104.7 weeks ago for an annualized gain of 55.8%, which is less than the 72.9% reported 91 weeks ago. International indices were down significantly last week after being up for seven consecutive weeks.

The lone bear is down 1.4% since the Mid-term Indicant signaled bear ten weeks ago.

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

March 13, 2005 Indicant.Net Weekly Update

Volume 03, Issue 2 ISSN 1526 6516 © The Indicant Stock Market Report

Dear Indicant Members:

This Week’s Report

Are We in the Early Stage of a 1970’s Market – Part IV

As long as underlying fundamentals remain congruent with a 1970’s type of stock market, much of the following will be similar to prior reports. The idea is to remain vigilant about rising interest rates, rising commodities, higher fuel costs, and the historical burden of the post election year. The economic fundamentals are eerily similar to that of the 1970’s. There is one major difference, though, and that is rising productivity. That alone may prevent the market from expressing dynamic bearish behavior.

Productivity is the one and only reason for the rising quality of life. It all began when the cave dwellers carved out the stone to make the first wheel. It does not take much imagination to relate that labor intensive experience with the low cost/high quality modern day automobile wheel.

Productivity information is sketchy. Greenspan recognized rapidly rising productivity in the early 1990’s. That phenomenon, along with inexpensive and stable fuel costs, helped the propulsion of the profound and unprecedented bull market in the 1990’s. Greenspan rapidly reduced interest rates to help fuel demand for production. Several factors helped fuel these unbelievable economic dynamics. Rising entrepreneurialism that began with supply side economics in the 1980’s, fueled the rapid rise in Small Caps and prosperous Ma and Pa operations, where individual happiness excels. Academic credentials fell in importance, while hard work, passion, and desire to “make a difference” returned to economies around the world. The combination of the Toyota Production System and Bill Gates’ Microsoft products helped the rising productivity.

There is another phenomenon that did not exist in the 1970’s. Less than a third of the world’s population were free to express their capitalistic feelings. The majority of the world’s population was encumbered with dictatorships including communism. Even the free world was biasing policy and behavior toward credentialism, which was the mainstay of communism. Credentials do not invent automobiles, penicillin, computers, etc. Too many college and high school drop outs repeatedly prove that passion and hard work are tantamount to progress, regardless of background.

Finally, the 1970’s economy was petroleum based. Now, petroleum is not as influential as it was in the 1970’s. There are several other industries that are not dependent on petroleum. It is not a major contributor to GNP.

So, as you can see, there are some differences between now and then. However, these differences may not be enough to offset the magnitude of rising commodity prices. It is better for this planet to be entirely capitalistic in the long-term, but it may not be pain-free in the short-term. Much of this pain is inflicted by the political establishment. This is especially true in a lame-duck presidency in the post election year.

Unfortunately, rising productivity cannot keep up with the current rate of rising commodity prices. Labor represents only a fraction of material, labor, and overhead costs. Material and overhead costs are the two big cost components in the production of products. Rising material costs will eventually depress profit margins. This will reduce the appeal for equity ownership. That scenario introduces an increasing threat of bear markets. Real estate tends to increase in value during inflationary periods and potential equity investment dollars will be directed to that industry. That will reduce the demand for stocks. That along with depressing profit margins will stimulate bearish enthusiasm.

Although redundant to recent reports, it is the Indicant’s responsibility to keep you informed of fundamental issues, even though most of the Indicant modeling is technical. Look again at the CRB Bridge Futures by clicking the following link.

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

As you can see, it along with Gold and Oil are rising. The CRB Bridge Futures five years ago was threatening Greenspan with deflationary concerns. That helped propel interest rates to historical lows. That propelled the stock market to unprecedented heights. That led to Greenspan’s “irrational exuberance” comment. About the same time all this nonsense was occurring, which by the way was in Clinton’s post election year, the stock market peaked. The bear was unleashed. The NASDAQ’s bear was congruent to that of the 1929-1932 Dow Bear. Commodity prices are raw material. Rising productivity does not match the rise in commodity prices.

There is no loyalty to the democratic process of a lame-duck administration in post election years. Vote getting is not an issue. Since Americans vote their pocket book, it would not be out of line for you to embrace a bearish stance for 2005. The market typically finds a bottom in the mid-term election year, which will occur in 2006. That means the market has to go down for a bottom to be found next year. That would be consistent with historical standards.

Last week, nearly all sectors expressed bearish behavior. Even the Energy Sector took it on the nose. This convergent bearish behavior is consistent with bear markets. This convergence was due to two different reasons. The Energy Sector fell victim to profit taking. Also, keep in mind the markets are always looking six to nine months in the future. If it senses rapidly falling oil prices, then last week’s Energy-related bearish behavior will continue.

General equities fell in anticipation of $50 oil compression on profit margins. Corporations will do one of two things; jack up prices to cover the increased material and energy costs or endure lower operating profits. The stock market does not like either of those two scenarios. If prices rise, the Consumer Price Index will move north. Greenspan will aggressively shut down demand in an attempt to not disrupt his legacy. The resulting unemployment and recessionary consequences in this post election year are irrelevant. He, along with the political establishment, will bias economic pain and suffering well ahead of vote-getting time in 2008.

All this is a prognosis, of which, could be entirely wrong. The various Indicant models will keep you informed of the market’s interpretation of these phenomena on a real time basis. It is always about perception.

Weekly Buy/Sell Summary

The Mid-term Indicant generated two buy signals and nine sell signals for stocks and funds. There was one sell signal for mutual funds. That was the first sell signal for a fund since October 2004.

In addition to the sell signals, the Mid-term Indicant is avoiding 68 stocks and funds of the 320 tracked by the Indicant. The avoided stocks and funds are down an average of 28.9% since the Mid-term Indicant signaled sell an average of 52.4 weeks ago.

There were only 15 stocks and funds avoided at this time last year. The avoided stocks and funds one year ago were down an average of 27.4% since their respective sell signals an average of 39.2 weeks earlier. Two years ago, on March 15, 2003, the Mid-term Indicant was avoiding 141 stocks and funds that were down an average of 11.0% since their respective sell signals an average of 8.3 weeks earlier. There were 14 sell signals and 17 buy signals two years ago, ahead of the second buying spree that occurred in March 2003.

In addition to the buy signals this weekend, the Mid-term Indicant is signaling hold for 241 of the 320 stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 86.2%. That annualizes to 61.9%, which is down from 124.1% reported on June 7, 2003, but up from 50.2% reported over two years ago on February 15, 2003. The Mid-term Indicant has been signaling hold for these 241 stocks and funds for an average of 72.4 weeks.

One year ago, the Mid-term Indicant was holding 263 stocks and funds out of the 296 tracked at that time for an average of 46.1 weeks. They were up 68.4% (annualized at 77.2%). The Mid-term Indicant was signaling hold for 124 stocks and funds two years ago on March 15, 2003. They were up by an average of 25.3% (annualized at 56.7%) since their respective buy signals an average of 23.3 weeks earlier.

Secular Market Blend

This paragraph is a repeat from the last several months with a few modifications reflecting recent secular influences. The current mid-term bull market and buying barrage in late 2002 followed the predicted market bottom in 2002. The mid-term presidential election year phenomenon was consistent with history. Even more impressive was how the market synchronized with near perfection to normal seasonality in 2002.

The Dow30 found bottom on October 9, 2002 at 7286.27. The NASDAQ found bottom on the same day at 1114.11. 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.

Some of you recall the Short-term Indicant Bear for the NASDAQ was the longest in history. It even exceeded the Dow’s 1929-1932 Short-term Indicant Bear in breadth. The good news is that the NASDAQ’s decline did not lead to a depression, which is a clear indication of how little influence the tech stocks have on the economy. Remember, real economic wealth is delivered in only three ways; manufacturing, agriculture, and extraction. All other industries are merely transfer agents of wealth.

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 changes, there will be modifications to it to maintain a proper frame of reference.

You will notice many of the mutual fund buy signals occurred in March 2003. Many of you recall how the market did not synchronize with the heart and soul of bullish seasonality from November 2002 through February 2003. 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 during bearish seasonality during most of 2003. The market continued moving north during that time, contrary to historical 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 year, 2004, was consistent with normal bearish seasonality. Unfortunately, bearish expressions started ahead of schedule in 2004. However, the bullish expressions, which solidified in October 2004, synchronized beautifully with historical standards with a bullish outburst. The Quick-term Indicant accurately revealed an early start to bullish seasonality in late 2004. The early part of December was not consistent with the normal Santa Clause rally. However, bullish expressions resumed in late December 2004. Some quick-term attributes suggested there would be a Santa Clause rally and that is exactly what happened. The market is still elevated as a function of the typical fourth quarter rally in 2004. Unfortunately, the Quick-term Bear that plagues normal bullish seasonality for the second consecutive year is challenging this elevated position.

Although not surprising, 2005 began with unfavorable performance to bullish seasonality. The Quick-term Indicant signaled bear in early January 2005. Bearish expressions followed. At first, these bearish expressions were mild, but five weeks ago, bearish behavior revealed greater aggression. However, that aggression was muted with a bullish response. That bullish response was weak but possessed enough bullish steam to thwart aggressive bearish behavior. All the Quick-term attributes remain biased with bearish tendencies even though the bull is demonstrating significant resistance to bearish ambition. The bullish response to bearish enthusiasm consumed significant bullish energy, but recent behavior is revealing the bull has potential strength. Thus, the Quick-term Indicant continues to signal bear, as “potential” is not fact. There are some quick-term attributes shifting in support of even more bearish expressions on a quick-term basis, but the Mid-term Bull remains solid.

The presidential post election year is, historically, the most bearish year on the four-year presidential election cycle. Like all things, there are exceptions to historical normalcy. As this year progresses, the various Indicant models will advise if 2005 is an exception or normal. So far, this year appears normal; that is bearish. The Short-term Indicant continues signaling bear. The Mid-term and Long-term Indicant models continue to signal bull. The short cycles are dominating now, but your hold positions still appear safe.

The buy signals the past few weekends may very well be short-lived. Although we are still within bullish seasonality, the Quick-term attributes have not yet shifted significantly enough to signal bull. This may occur next week. If so, that will be another reason to be optimistic about your holdings. 1970-type fundamentals were increasingly apparent this past week with oil stocks rising rapidly while all other sectors continued their meandering ways.

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 continues recommending a stop loss of 8% because of the Quick-term Bear. The Quick-term Indicant’s configuration is enough to outweigh bullish seasonality.

If you are up by 50% or more you may find it advantageous to set your stop-loss at 15% from your current hold position. If you sold a stock on the stop loss and the Indicant continues to signal hold, do not buy the stock unless the Quick-term Indicant is signaling bull.

Use a 10% trailing stop loss or the yellow or green values you will find on the tables. 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. There are some instances where stocks rise during bear markets due to legitimate fundamental reasons.

Special Note Regarding the Importance of Stop Losses

The Mid-term Indicant was forced to signal buy for Elan, Indicant Select Stock #39. This followed last week’s sell signal. It is common for a short recoil after a stock’s crash. That recoil triggered the buy signal. Sometimes “crashed stocks” continue moving upward for a short time. At other times, the stock can continue a steady rise in the face of being severely bruised. If you act on this buy signal, make absolutely certain you input your stop loss. Such stocks are extremely bouncy after severe punishment.

http://www.indicant.net/Members/Updates/MTI-Stks-Indicant%20Sel/S07.htm#39

Stock and Fund Update

Click the following link to see sorted performance of stocks and funds with hold/avoid signals. In the past, we included them 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.

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

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 update 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

Divergence versus Convergence

Contrary to last week, the market induced a bearish surge of convergence last week. That is bearish. If this convergent behavior continues, the bear will accelerate its influence on the market’s direction. Even the Energy Sector expressed bearishness, but mostly due to some short-term profit-taking and contrarian behavior. Oil prices seem to be settling at higher prices, but the market moved on today’s news about six month’s ago.

As stated the past two weeks, your “new money” behavior should be consistent with bearish bias, even though several Indicant models continue to signal bull.

Economic Conditions – Inflation, Currency, Interest Rates

Commodity prices continue skyrocketing. The equity markets are showing surprising resiliency by not turning into a dynamic bear. If commodity prices continue to rise and impregnate the Consumer Price Index, rest assured the bear will be delighted with significant gusto.

As stated last week, the current cyclical behavior appears adjusting to trends similar to that of the 1970’s. The recent rise in commodities is not passive. It is arousing the bear with the potential of significant emotion. It is bearish emotion that can yield swift and significant punishment to the passive, long-term investor. As stated last week, the bull can contribute to the least-worse case of a meandering market. However, the strongest of bulls cannot standup to excessive inflation or deflation. Right now, the threat is inflation and its serious nature is growing.

The U.S. Dollar remains weak, but continues to remain above cyclical minimums. It has resumed cyclical weakness the past few days, though. The dollar will strengthen provided Greenspan continues increasing interest rates. A strengthening dollar is generally anti-inflationary. Interest rates continue their slope to the northeast on the charts. However, they remain at historically low levels. The weak dollar is generally bullish for U.S. companies, but the world continues to shrink. The internationalism of capitalism and asset ownership is blending confusion as to what is advantageous to a specific geographic section of stocks or funds.

As stated the last few weeks, the looming threat in the short-term is Greenspan’s interpretation of the skyrocketing commodity prices. That alone can kill the current Mid-term Bull markets and set off profound bearish behavior.

This paragraph remains unchanged from the past fifteen weeks with a few modifications. Interest rates continue their rise, but still from historically low levels. Right now, the stock market is not being bothered by this unfavorable direction on a mid-term basis, while at the same time; equities will not take their suspicious eye off it. The recent bearish bias by the Quick-term Indicant may be an early indication of the market’s intolerance to these unfavorable trends. There is some point where equities will not like the “position” of interest rates if Greenspan continues his northward trek. It is not uncommon to over-cool the economy in post election years, which is now underway.

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

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 75.2% one-hundred and forty-two weeks ago since the MTI buy signal in April 2001. One-hundred and thirty-five weeks ago, it closed up 30.1%. Last week it closed up 150.1%, which is higher than the 75.9% reported 86-weeks ago. The current annualized growth rate since the April 13, 2001 buy signal is 37.8%, which is significantly higher than 23.1% reported 86 weeks ago. This fund is up from its most recent peak on December 5, 2003 when it was up 117.3%. This fund moved north last week for the nineth week in a row. It has the 1970’s look to it.

The Fidelity Gold Fund #28 is up 16.2% (annualized at 28.8%) since the Mid-term Indicant signaled buy on August 20, 2004. The last buy/sell cycle was from December 7, 2001 to April 30, 2004 resulted in a 52.9% gross profit. As stated the past several months, if Greenspan gets aggressive in his fight against inflation, this fund will most likely not provide the nice profit it did on the last buy/sell cycle. This fund moved north the past five weeks after moving south the previous two weeks. It also is beginning to express a 1970’s type of behavior.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 185.4% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 71.2%. Vanguard Energy #18, VGENX, is up 95.5% (annualized at 48.7%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 60.3% (annualized at 47.1%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 70.3% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 47.1%.

After rising significantly the past seven weeks, these energy related funds fell last week due to profit-taking and “selling on the news.” As stated last week, if the Chinese economy heats up again, expect these energy related funds to resume their bullish march.

The Gold Index is up 10.9% since the Mid-term Indicant signaled bull on July 9, 2004. This index has been flat for three quarters of a year. It is uncommon for this index to not express bullish behavior with rising oil prices. However, the high oil prices have not yet impregnated the consumer price index. When that happens, the gold index and other gold related securities should move to the north.

As repeatedly asked, is this the 1970’s all over again? The remainder of this paragraph will remain unchanged until such time conditions change. So far, it does not look that way, but increasing bullish expressions in the energy sector will lead to more bearish expressions in general equity markets. This may continue in this presidential post election year. The political system is not sensitive to democratic desires during lame-duck presidencies. Again, forecasting the market is okay for hallway conversations, but never give your broker instructions based on a forecast. The Indicant will keep you posted on the market’s cyclical and trend inclinations. There is definite behavior supporting a 1970’s type of theme.

These funds and the gold and silver index should convey the market’s perception of terrorism, inflation, and the economy. As long as they are in solid hold/bull positions, there remains some pessimism regarding the future of the economy.

Quick-term and Short-term Indicant Update

The Quick-term Indicant Bear that was born on January 4, 2005 has now survived for about ten weeks. As stated the past few weeks, that is a long period of survival in the midst of the heart and soul of bullish seasonality. It was met with bullish resistance when the indices approached the bearish yellow curve. That was a favorable response with respect to your hold positions. The longer this Quick-term Bear survives the better chance for greater breadth than normal Quick-term bears in Mid-term Bull markets. This will continue to be monitored until it expires. Most quick-term bears do not survive too long during bullish seasonality. This quick-term bear was on the verge of expiration five weeks ago, but the potential burgeoning bull expended too much energy preventing complete bearish dominance. There is simply not enough bullish energy for a new Quick-term Bull to dominate the market at this time.

Read the daily emails for more about the Quick-term Indicant. It is still a Quick-term Bear.

Please review the daily reports for more details regarding the Quick-term Indicant.

To view the Quick-term Indicant charts, please click the following hyperlink:

http://www.indicant.net/Members/Updates/STI-Mkts/QT.htm

The NASDAQ Indicant Volume Indicator continues declining with recent bullish and bearish expressions. This is not favorable to an expectation of strong bullish sentiment. As stated the last two weeks, it is also supportive of continued meandering behavior. The declining Indicant Volume Indicators are an indication there is no strong support for a long-lasting Quick-term Bear. However, keep your eye on this. The Quick-term attributes can change quickly. Prior to this shift in direction there was increasing bearish sentiment on a quick-term basis, but that has since been dampened. Friday’s bullish behavior helped solidify your hold positions.

http://www.indicant.net/Members/Updates/STI-Mkts/IVI.htm

The Dow is now up 2.9% since the Short-term Indicant signaled bear on January 20, 2005. The NASDAQ is down 1.8% since the Short-term Indicant signaled bear on January 11, 2005. Both indices are Short-term Bears. Again, too much bullish energy was consumed to fend off bearish dominance. Most of the Dow’s rise is due to Exxon’s meteoric increase in stock price. The Dow’s expressions of bullish behavior is misleading.

To view the Short-term Indicant charts, please click the following hyperlink:

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

A link to the Dow’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20DJIA1995-2002.htm

A link to the NASDAQ’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20NAS1995-2002.htm

Perspectives

This paragraph is unchanged from the past three weeks. The indices have retracted from their bullish breakout lines. They are not yet threatening their respective breakdown lines. Although there is a Quick-term Indicant Bear in progress, the perspectives reveal no deep bears on the immediate horizon. The small caps continue resisting bearish influences. They have recently been engaging its breakout line, which is bullish for that particular group of stocks. The Quick-term modeling requires consistent signaling and thus cannot signal bull even though one of the indices is expressing bullish behavior in the face of the Quick-term Bear.

Read your daily emails.

To view the Perspective Charts (Quick-term Indicant, please click the following.

http://www.indicant.net/Members/Updates/STI-Mkts/QTP.htm

Refer to the daily reports for more information about the Quick-term Indicant.

For more information about the Quick-term Indicant, refer to last week’s daily reports.

Mid-term Indicant Positions - Major U.S. Market Indices

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

The eight major indices are up an average of 28.1% since the Mid-term Indicant signaled bull an average of 72.8 weeks ago. That annualizes to 20.1%. The Dow Transports is the strongest bull. It is up 69.3% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Jones Industrial Average is up 26.4% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Composite is up 44.3% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Utilities is up 52.3% since the Mid-term Indicant bull signal on August 16, 2003.

Six of the eight major indices continue as red bulls. Just when the survivability of these bulls were in question six weeks ago, they responded with a bullish fervor in the face of the Quick-term Bear. Again, that is a testament to the strength of this Mid-term Bull market. However, as stated the last few weeks, they are being threatened with the potential of rising inflation and interest rates.

To view Mid-term Indicant charts for U.S. Market Indices, please click the following link.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20MTI-Mkts-US.htm

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

Mid-term Indicant Positions - International Markets

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

Although there were no new bull signals, twenty-one of the twenty-two foreign indexes tracked by the Indicant are Mid-term Bulls. They are up an average of 114.7% since the Mid-term Indicant signaled bull an average of 103.7 weeks ago for an annualized gain of 57.5%, which is less than the 72.9% reported 90 weeks ago. International indices are up the past seven weeks.

The lone bear is up 3.6% since the Mid-term Indicant signaled bear nine weeks ago.

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

March 06, 2005 Indicant.Net Weekly Update

Volume 03, Issue 1 ISSN 1526 6516 © The Indicant Stock Market Report

Dear Indicant Members:

This Week’s Report

Are We in the Early Stage of a 1970’s Market – Part III

Most noticeable is the unrelenting movement in key commodity prices. Such behavior will eventually repulse any bullish inclination. That is fuel for a great bear market. One-billion new capitalists in China is an unprecedented demand shift against finite natural resources. Look at the below link. You will notice the BRB-Bridge Future commodity prices continue gusto movement to the north. You will also notice oil and gold moving in the same direction. That behavior is eerily similar to that of the 1970’s.

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

The good news is that capitalists solve all problems confronting humankind. Government, grant money, or academic endeavors seldom provide solutions to problems. Capitalists by nature are problem-solvers. This is especially when a profit is associated with their interest. One billion new capitalists will produce ten times the number of Bill Gates and Henry Ford types. That means for every natural resource consumed, a synthetic of equal or better quality will be created.

Unfortunately, the stock market does not care about what is going to happen ten years or so from now. It only cares about the next six to nine months. That is the nature of the finance function. Finance is focused on paying this month’s rent or mortgage payment and annual budgets. Financial planning beyond six to nine months is mostly statements of fiction. Many NASDAQ oriented investors in 2000 learned that the hard way.

Wall Street likes quarterly financial reviews and assesses company performance with those quarterly statements. Since the financial function is basically linear and two dimensional, the next two to three quarters are extrapolated. That is why the market typically smells a recession about six to nine months before it gets here. Sometimes the market smells placebo recessions and crashes anyway. That sort of behavior reflects negative human emotion, which is incapable of projecting the future.

Even though the dynamics of stock markets are passionately in love with hard-driving, hard-working capitalists, it does not like inflation, deflation, or high interest rates. It has historically reacted bitterly to any of those three attributes. The current direction in interest rates and commodity prices continues to threaten the stock market much like that in the 1970’s.

A February 23, 1973 “buy and hold” investor in the Dow30 would have been out of the money on October 15, 1976. Click the following link to see how the buy and hold investor fared during this time. Scroll down below the chart to see the values on the chart at the time of the bull or bear signal.

http://www.indicant.net/Non-Members/Tours/MTIRYS-Mkts-US/MTIRYS-01-DJI-1972-1976.htm

By clicking the below link, you can see the buy and hold investor is even further out of the money by the end of the 1970’s. On February 22, 1980, the buy and hold account is down to $132,173 by trade number 11 on the chart. Again, scroll down below the chart to see the corresponding table of values.

http://www.indicant.net/Non-Members/Tours/MTIRYS-Mkts-US/MTIRYS-01-DJI-1976-1980.htm

As you can see, the buy and hold investor’s account balance on February 23, 1973 amounted to $146,035. That balance shriveled to $132,173 by February 22, 1980. Enduring such bearish expressions to individual net worth drives investors out of the stock market. More people enter the market, replacing the dropouts. The dropouts pay the ultimate price of not making the easy money. The buyer and holders eventually make money, provided the bears are not protracted beyond their investment lifetime. Bears can and do last more than twenty-five years.

However, keep in mind, that during the 1970’s Halliburton, Schlumberger, Exxon, and other similar companies skyrocketed. Energy sensitive stocks and funds, quite often, move inversely to the stock market indices. For example, Mutual Fund #9, State Street Research, is up 195.3% since the Mid-term Indicant signaled buy on August 16, 2002.

http://www.indicant.net/Members/Updates/MTI-Mutual%20Funds/MF02.htm#9

Halliburton, Indicant Select Stock #64, is up 225.1% since the Mid-term Indicant signaled buy on August 9, 2002. This stock and the aforementioned mutual fund originated their current bull cycle about six months before the United States attacked Iraq. It has been common knowledge that unrest in the Middle Eastern countries leads to higher oil prices. Also, Economics 101 on the law of supply and demand foretells how China’s expanding economy imposes unprecedented premium demand on limited natural resources. It is interesting that this stock, along with several other energy related stocks paralleled the bull market of 2003. That sort of congruency is not long lasting. The energy sector lagged the general markets quite severely in the 1980’s and 1990’s. For example, Halliburton peaked in 1980 before falling by 75% by the middle 1980’s. The overall stock market moved north at a record setting pace during that time.

http://www.indicant.net/Members/Updates/MTI-Stks-Indicant%20Sel/S11.htm#64

All of the 1970’s related economic attributes continue favoring a bearish stock market. However, there is no need to forecast that. The various Indicant indicators will keep you posted on the markets’ quick-term, mid-term, and long-term intentions. Right now, the Quick-term Indicant is on the wrong side of the quick-term cycle, but continues to signal bear. The Mid-term Indicant continues to signal bull. Your more mature holdings are safe to continue holding.

Weekly Buy/Sell Summary

The Mid-term Indicant generated one buy signal and three sell signals for stocks. There was one sell signal for mutual funds. That was the first sell signal for a fund since October 2004. That is the first sign of a potentially shaky bull market. Fidelity’s Biotechnology fund received the sell signal. The pharmaceutical industry has been shaky since the flu vaccination fiasco late last year.

In addition to the sell signals, the Mid-term Indicant is avoiding 67 stocks and funds of the 320 tracked by the Indicant. The avoided stocks and funds are down an average of 29.3% since the Mid-term Indicant signaled sell an average of 53.6 weeks ago.

There were only 17 stocks and funds avoided at this time last year. The avoided stocks and funds one year ago were down an average of 26.2% since their respective sell signals an average of 44.7 weeks earlier. Two years ago, on March 8, 2003, the Mid-term Indicant was avoiding 131 stocks and funds that were down an average of 12.0% since their respective sell signals an average of 7.9 weeks earlier. There were 27 sell signals and 3 buy signals two years ago, ahead of the second buying spree that occurred in March 2003.

In addition to the buy signal this weekend, the Mid-term Indicant is signaling hold for 249 of the 320 stocks and funds tracked by the Indicant. The stocks and funds with hold signals are up an average of 87.3%. That annualizes to 64.8%, which is down from 124.1% reported on June 7, 2003, but up from 50.2% reported over two years ago on February 15, 2003. The Mid-term Indicant has been signaling hold for these 249 stocks and funds for an average of 70.1 weeks.

One year ago, the Mid-term Indicant was holding 275 stocks and funds out of the 296 tracked at that time for an average of 44.7 weeks. They were up 73.1% (annualized at 85.1%). The Mid-term Indicant was signaling hold for 135 stocks and funds two years ago on March 8, 2003. They were up by an average of 22.6% (annualized at 55.6%) since their respective buy signals an average of 21.1 weeks earlier.

Secular Market Blend

This paragraph is a repeat from the last several months with a few modifications reflecting recent secular influences. The current mid-term bull market and buying barrage in late 2002 followed the predicted market bottom in 2002. The mid-term presidential election year phenomenon was consistent with history. Even more impressive was how the market synchronized with near perfection to normal seasonality in 2002.

The Dow30 found bottom on October 9, 2002 at 7286.27. The NASDAQ found bottom on the same day at 1114.11. 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.

Some of you recall the Short-term Indicant Bear for the NASDAQ was the longest in history. It even exceeded the Dow’s 1929-1932 Short-term Indicant Bear in breadth. The good news is that the NASDAQ’s decline did not lead to a depression, which is a clear indication of how little influence the tech stocks have on the economy. Remember, real economic wealth is delivered in only three ways; manufacturing, agriculture, and extraction. All other industries are merely transfer agents of wealth.

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 changes, there will be modifications to it to maintain a proper frame of reference.

You will notice many of the mutual fund buy signals occurred in March 2003. Many of you recall how the market did not synchronize with the heart and soul of bullish seasonality from November 2002 through February 2003. 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 during bearish seasonality during most of 2003. The market continued moving north during that time, contrary to historical 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 year, 2004, was consistent with normal bearish seasonality. Unfortunately, bearish expressions started ahead of schedule in 2004. However, the bullish expressions, which solidified in October 2004, synchronized beautifully with historical standards with a bullish outburst. The Quick-term Indicant accurately revealed an early start to bullish seasonality in late 2004. The early part of December was not consistent with the normal Santa Clause rally. However, bullish expressions resumed in late December 2004. Some quick-term attributes suggested there would be a Santa Clause rally and that is exactly what happened. The market is still elevated as a function of the typical fourth quarter rally in 2004.

Although not surprising, 2005 began with unfavorable performance to bullish seasonality. The Quick-term Indicant signaled bear in early January 2005. Bearish expressions followed. At first, these bearish expressions were mild, but five weeks ago, bearish behavior revealed greater aggression. However, that aggression was muted with a bullish response. That bullish response was weak but possessed enough bullish steam to thwart aggressive bearish behavior. All the Quick-term attributes remain biased with bearish tendencies even though the bull is demonstrating significant resistance to bearish ambition. The bullish response to bearish enthusiasm consumed significant bullish energy, but recent behavior is revealing the bull has potential strength. Thus, the Quick-term Indicant continues to signal bear, as “potential” is not fact. There are some quick-term attributes shifting in support of even more bearish expressions on a quick-term basis, but the Mid-term Bull remains solid.

The presidential post election year is historically the most bearish year on the presidential election cycle. Like all things, there are exceptions to historical normalcy. As this year progresses, the various Indicant models will advise if 2005 is an exception or normal. So far, this year appears normal; that is bearish. The Short-term Indicant continues signaling bear. The Mid-term and Long-term Indicant models continue to signal bull. The short cycles are dominating now, but your hold positions still appear safe.

The buy signals the past few weekends may very well be short-lived. Although we are still within bullish seasonality, the Quick-term attributes have not yet shifted significantly enough to signal bull. This may occur next week. If so, that will be another reason to be optimistic about your holdings. 1970 type fundamentals were increasingly apparent this past week with oil stocks rising rapidly while all other sectors continued their meandering ways.

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 continues recommending a stop loss of 8% because of the Quick-term Bear. The Quick-term Indicant’s configuration is enough to outweigh bullish seasonality.

If you are up by 50% or more you may find it advantageous to set your stop-loss at 15% from your current hold position. If you sold a stock on the stop loss and the Indicant continues to signal hold, do not buy the stock unless the Quick-term Indicant is signaling bull.

Use a 10% trailing stop loss or the yellow or green values you will find on the tables. 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. There are some instances where stocks rise during bear markets due to legitimate fundamental reasons.

Special Note Regarding the Importance of Stop Losses

Last week, Elan, Indicant Select Stock #39, was up over 1,000% since the Mid-term Indicant signaled buy on November 8, 2002. Unfortunately, their multiple sclerosis fighting drug, Tysabri, has been removed from the market. The stock price fell last week from $26.90 to $5.71 or by 79%. That is the trouble with stocks; especially those that do not enjoy clarity in their products from the laboratory to the market. The detection of destructive drug behavior can occur years after FDA approval. Although biotech and pharmaceutical companies are appealing with the aging baby boomers, the nature of their market does not provide a safe bet. Although the stock generated an 138.9% gross profit from its buy signal on November 8, 2002 at $2.39, accepting that after enjoying a rise in price of over 1,000% is difficult. Setting stop losses helps minimize frustrations such as this.

http://www.indicant.net/Members/Updates/MTI-Stks-Indicant%20Sel/S07.htm#39

Elan is not the only stock expressing destructive behavior. NAS100 #86, Biogen, endured a similar fate and for the same reason as Elan. That stock plummeted 44.2% last week. The Mid-term Indicant signaled buy for this stock on October 4, 2003. Last weekend it was up 93.4% since that buy signal. The sell signal this weekend yields only a 7.9% gross profit. After commissions and the time value of money, the optimist may claim break-even, but it is actually a loss.

http://www.indicant.net/Members/Updates/MTI-Stks-NAS100/NS15.htm#86

Maintain your stop losses with a time management discipline that is consistent with your most treasured activities in life. This is the nature of stock ownership. This behavior contributed to the weakness in Fidelity’s Biotech fund, where the drop in price was less severe. Although mutual funds are less likely to go up by quadruple amounts, the high number of stocks they contain spread the risks. In return for not enjoying the thrill of a high riser, one also mitigates the risks of sudden and deep drops in stock prices by owning mutual funds.

Stock and Fund Update

Click the following link to see sorted performance of stocks and funds with hold/avoid signals. In the past, we included them 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.

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

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 update 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

Divergence versus Convergence

There was a bullish surge late last week some convergent behavior. Unfortunately, that movement still lagged the energy sector. Even the Internet sector expressed some robust bullish energy last week, but took it from bearish to neutral position. The Pharmaceutical and Biotech sectors took it on the chin last week and continues in a divergent pattern. As stated last week, this pattern of convergence is/was minor. A divergence in position between energy and other sectors supports a continuing bearish bias on a quick-term basis.

As stated last week, your “new money” behavior should be consistent with bearish bias, even though several Indicant models continue to signal bull.

Economic Conditions – Inflation, Currency, Interest Rates

Commodity prices continue skyrocketing. The equity markets eventually punish those who blindly believe the stock market always delivers added personal net worth. It does not work that way for generations of people. Yes, some are born at the right time for blind success, while others are not so lucky. The problem is for most investors, they do not know if they were born in the lucky periods. will not like this.

At any rate, current cyclical behavior appears adjusting to trends similar to that of the 1970’s. The recent rise in commodities is not passive. It is arousing the bear with the potential of significant emotion. It is bearish emotion that can yield swift and significant punishment to the passive, long-term investor. As stated last week, the bull can contribute to the least-worse case of a meandering market. However, the strongest of bulls cannot standup to inflation or deflation. Right now, the threat is inflation and its serious nature is growing.

The U.S. Dollar remains weak, but continues to move above cyclical minimums. It will strengthen provided Greenspan continues increasing interest rates. A strengthening dollar is generally anti-inflationary. Interest rates continue their slope to the northeast on the charts. However, they remain at historically low levels.

As stated the last few weeks, the looming threat in the short-term is Greenspan’s interpretation of the skyrocketing commodity prices. That alone can kill the current Mid-term Bull markets and set off profound bearish behavior.

This paragraph remains unchanged from the past fourteen weeks with a few modifications. Interest rates continue their rise, but still from historically low levels. Right now, the stock market is not being bothered by this unfavorable direction on a mid-term basis, while at the same time; equities will not take their suspicious eye off it. The recent bearish bias by the Quick-term Indicant may be an early indication of the market’s intolerance to these unfavorable trends. There is some point where equities will not like the “position” of interest rates if Greenspan continues his northward trek. It is not uncommon to over-cool the economy in post election years, which is now underway.

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

Fear Metrics: Economics and Terrorism

Vanguard Gold and Precious Metals (VGPMX) - #19 was up 75.2% one-hundred and forty-one weeks ago since the MTI buy signal in April 2001. One-hundred and thirty-four weeks ago, it closed up 30.1%. Last week it closed up 148.4%, which is higher than the 75.9% reported 85-weeks ago. The current annualized growth rate since the April 13, 2001 buy signal is 37.6%, which is significantly higher than 23.1% reported 85 weeks ago. This fund is up from its most recent peak on December 5, 2003 when it was up 117.3%. This fund moved north last week for the eighth week in a row. It has the 1970’s look to it.

The Fidelity Gold Fund #28 is up 12.6% (annualized at 23.1%) since the Mid-term Indicant signaled buy on August 20, 2004. The last buy/sell cycle was from December 7, 2001 to April 30, 2004 resulted in a 52.9% gross profit. As stated the past several months, if Greenspan gets aggressive in his fight against inflation, this fund will most likely not provide the nice profit it did on the last buy/sell cycle. This fund moved north the past four weeks after moving south the previous two weeks. It also is beginning to express a 1970’s type of behavior.

State Street Research Global #9, SSGRX, which is isolated in the energy sector, is up 195.3% since the Mid-term Indicant signaled buy on August 16, 2002. It is annualizing at 75.5%. Vanguard Energy #18, VGENX, is up 102.1% (annualized at 52.6%) since the Mid-term Indicant signaled buy on April 5, 2003. Fidelity Energy Services #40, FSESX, is up 68.3% (annualized at 54.2%) since the Mid-term Indicant signaled buy on December 6, 2003. Fidelity Energy #39, FSENX, is up 79.9% since the Mid-term Indicant signaled buy on August 16, 2003. It is annualized at 50.8%.

These energy related funds are up significantly the past seven weeks. That is consistent with a 1970’s type of market. As stated last week, if the Chinese economy heats up again, expect these energy related funds to continue their bullish march.

The Gold Index is up 8.7% since the Mid-term Indicant signaled bull on July 9, 2004. This index has been flat for three quarters of a year. It is uncommon for this index to not express bullish behavior with rising oil prices. However, the high oil prices have not yet impregnated the consumer price index. When that happens, the gold index and other gold related securities should move to the north.

As repeatedly asked, is this the 1970’s all over again? The remainder of this paragraph will remain unchanged until such time conditions change. So far, it does not look that way, but increasing bullish expressions in the energy sector will lead to more bearish expressions in general equity markets. This may continue in this presidential post election year. Again, forecasting the market is okay for hallway conversations, but never give your broker instructions based on a forecast. The Indicant will keep you posted on the market’s cyclical and trend inclinations. There is definite behavior supporting a 1970’s type of theme.

These funds and the gold and silver index should convey the market’s perception of terrorism, inflation, and the economy. As long as they are in solid hold/bull positions, there remains some pessimism regarding the future of the economy.

Quick-term and Short-term Indicant Update

The Quick-term Indicant Bear that was born on January 4, 2005 has now survived for about nine weeks. As stated the past few weeks, that is a long period of survival in the midst of the heart and soul of bullish seasonality. It was met with bullish resistance when the indices approached the bearish yellow curve. That was a favorable response with respect to your hold positions. The longer this Quick-term Bear survives the better chance for greater breadth than normal quick-term bears in bull markets. This will continue to be monitored until it expires. Most quick-term bears do not survive too long during bullish seasonality. It was on the verge of expiration four weeks ago, but the potential burgeoning bull expended too much energy preventing complete bearish dominance. There is simply not enough bullish energy for a new Quick-term Bull to dominate the market at this time.

Read the daily emails for more about the Quick-term Indicant. It is still a Quick-term Bear.

Please review the daily reports for more details regarding the Quick-term Indicant.

To view the Quick-term Indicant charts, please click the following hyperlink:

http://www.indicant.net/Members/Updates/STI-Mkts/QT.htm

The NASDAQ Indicant Volume Indicator continues declining with recent bullish and bearish expressions. This is not favorable to an expectation of strong bullish sentiment. As stated last week, it is also supportive of continued meandering behavior. The declining Indicant Volume Indicators are an indication there is no strong support for a long-lasting Quick-term Bear. However, keep your eye on this. The Quick-term attributes can change quickly. Prior to this shift in direction there was increasing bearish sentiment on a quick-term basis, but that has since been dampened. Friday’s bullish behavior helped solidify your hold positions.

http://www.indicant.net/Members/Updates/STI-Mkts/IVI.htm

The Dow is now up 4.5% since the Short-term Indicant signaled bear on January 20, 2005. The NASDAQ is down 0.4% since the Short-term Indicant signaled bear on January 11, 2005. Both indices are Short-term Bears. Again, too much bullish energy was consumed to fend off bearish dominance. Most of the Dow’s rise is due to Exxon’s meteoric increase in stock price. The Dow’s expressions of bullish behavior is misleading.

To view the Short-term Indicant charts, please click the following hyperlink:

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

A link to the Dow’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20DJIA1995-2002.htm

A link to the NASDAQ’s Short-term Indicant table is as follows:

http://www.indicant.net/Non-Members/Tours/STI%20Tour/ST-Table%20NAS1995-2002.htm

Perspectives

This paragraph is unchanged from the past two weeks. The indices have retracted from their bullish breakout lines. They are not yet threatening their respective breakdown lines. Although there is a Quick-term Indicant Bear in progress, the perspectives reveal no deep bears on the immediate horizon. The small caps continue resisting bearish influences. They have recently been engaging its breakout line, which is bullish for that particular group of stocks. The Quick-term modeling requires consistent signaling and thus cannot signal bull even though one of the indices is expressing bullish behavior in the face of the Quick-term Bear.

Read your daily emails.

To view the Perspective Charts (Quick-term Indicant, please click the following.

http://www.indicant.net/Members/Updates/STI-Mkts/QTP.htm

Refer to the daily reports for more information about the Quick-term Indicant.

For more information about the Quick-term Indicant, refer to last week’s daily reports.

Mid-term Indicant Positions - Major U.S. Market Indices

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

The eight major indices are up an average of 29.8% since the Mid-term Indicant signaled bull an average of 71.8 weeks ago. That annualizes to 21.6%. The Dow Transports is the strongest bull. It is up 69.3% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Jones Industrial Average is up 28.4% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Composite is up 46.1% since the Mid-term Indicant signaled bull on March 22, 2003. The Dow Utilities is up 52.3% since the Mid-term Indicant bull signal on August 16, 2003. Six of the eight major indices continue as red bulls. Just when the survivability of these bulls were in question five weeks ago, they responded with a bullish fervor in the face of the Quick-term Bear. Again, that is a testament to the strength of this Mid-term Bull market. However, they are being threatened with the potential of rising inflation and interest rates.

To view Mid-term Indicant charts for U.S. Market Indices, please click the following link.

http://www.indicant.net/Members/Updates/All%20Update%20Forms/UD%20MTI-Mkts-US.htm

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

Mid-term Indicant Positions - International Markets

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

Although there were no new bull signals, twenty-one of the twenty-two foreign indexes tracked by the Indicant are Mid-term Bulls. They are up an average of 117.3% since the Mid-term Indicant signaled bull an average of 102.7 weeks ago for an annualized gain of 59.4%, which is less than the 72.9% reported 89 weeks ago. International indices are up the past six weeks.

The lone bear is up 3.5% since the Mid-term Indicant signaled bear eight weeks ago.

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

©All material contained in this Web site is copyright protected. Any redistribution of any information in this Web site is expressly prohibited unless written authorization is granted by the publisher  of Indicant.Net.

Additional Hyperlinks - Just click on any of the below to get where you want to go.

Become a Member | DJIA History Since 1900 | Back Issues | Mutual Fund Listing | Contact Us | Historical Performance Metric | Performance Summary for Stocks and Funds | Current Performance Report Card | Sector Funds That Did Well in Bear Market of 2000-2001 | ETF Tour| Option Stalking |Stocks | Ezine | Stocks in Spotlight | Indicant Volume Indicator | Perspectives | Seasonality

- **** -    -*****-