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Fund share prices as of: 10/05/07
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Today's Comments (Short Term Outlook)
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Jobs report Last week we talked about the market reversing any big moves made by stocks on the heels of a jobs report. We saw a little of that Monday but not all of the criteria was met. The stat about the market giving back gains after a big rally caused by the jobs report is based on an upward surprise in the report. The report actually came in close to the estimates (no statistical surprise), although as we also talked about, the August report was revised dramatically to the upside. Remember they reported a loss of 4000 jobs in August? Well it was revised to +89,000. It seems like a joke to me. The market sold off hard on the negative number last month and the actual number was respectable. And like I also mentioned, it was not a surprise to see the good jobs report and positive revision, as the market has been telling us all along by rallying big leading up to the release of the report. The market knows all. Stocks are on the overbought side and the short-term psychology indicators (such as sentiment surveys) are confirming that they are somewhat stretched to the upside, but momentum is still on the side of the bulls. We are seeing a couple of big steps forward, followed by a few small steps back. Yesterday was one of those small steps back after Friday's big step forward.  Chart provided courtesy of www.decisionpoint.com There is a lot of resistance overhead now in the S&P and as I mentioned, it has come a long way in the last several weeks, and while stops could run out of steam, I don't see too much trouble ahead. A 2% to 3% pullback would not be a bad thing here. The dollar has bounced off its lowest levels but the rebound is now against the old support, which could act as resistance now. When things look their worst it is usually a good time to be buying, but there are too many outside influences holding the dollar down to be confident about a rally. So, if the dollar does head back down, the I-fund will benefit most.  Chart provided courtesy of www.decisionpoint.com The Sentiment Survey System is in the G-fund this entire week after last week's 2.44 to 1 bulls (61%) to bears (25%) ratio in the poll. This is the 2nd consecutive week in the G-fund. The system is up over 20% this year and while it's not correct every week, it has been consistent enough from month to month to make it worth your consideration. It appears that I was not correct last week speculating that a transfer made late Friday (after the noon ET deadline and before Friday close of business) would be effective Tuesday (COB Monday). The fact is, no transactions were allowed to be effective Tuesday. Any transfer made after 12 noon ET on Friday won't be effective until close of business today for Wednesday. So, if you did make a transfer, you have until noon ET today to change your mind. Subscribers may have noticed that the Ebbchart System did schedule a transfer for Monday but was void. Speaking of the EbbChart, I started an email alert list for that system to let subscribers know a change has been made. Anyone can get on the list BUT no signals will be given in the alert - just a link to the member's area so you know something has changed. Bottom line: Stocks are due for a rest but fighting this momentum has not worked lately. Your choice on the risk vs. reward front. That's all for today. See you tomorrow. Have questions? Visit our message board for answers.
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