About Me

Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!

Sunday, December 13, 2015

Stock Market -- Quick Weekly Profile

The charts and text below are meant to benchmark the stock market ahead of the Fed's policy
meeting this week. 

Value Line Arithmetic Index (Unweighted)
$VLE is a 1700 stock composite that captures universe of US stocks that are most popular. $VLE 
The powerful uptrend dating from late 2011 ended earlier in the year and the index has been
flat although volatile since mid -2014 reflecting ending of huge QE 3 program, and peaking of
economic growth momentum which has ushered in a mild but persistent decline in profits that
does not yet show signs of a positive reversal. Note persistent decay of indicators since late '13
but with no sustainable price break yet.

Cumulative Advance / Decline Line ($NYAD)
Longer term but cyclical uptrend ended earlier in year and moderate breakdown is underway
as breadth is shrinking with investors becoming more quality and liquidity conscious. Recent
failure of A /D line to take out its 40 wk. m/a on rallies is a shorter term warning sign for the
market.

Buying Vs. Selling Pressure
My preferred indicator is the NYSE measure, or $TRIN. Readings on this measure above 1.5
for the weekly TRIN on the basis of a 6 wk. m/a suggest a strongly oversold market which was
evident in Q 3 '15. Following the recent rally in stocks the TRIN has moved into more neutral
territory but continues to show milder net selling pressure.

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