Amazing. The market keeps chugging along. There was a bit of selling toward the close but the market does need a breather.
I don't want to sound too much like a broken record but I am liking stocks for the long term but I am patiently waiting for a better entry point since I missed the first train out of the station.
Jason at Sentimentrader.com uses a stock to bond ratio indicator that is now showing stocks being extremely overvalued, a condition that has lead to a flat or declining market over the past couple of years. This is just one indicator and we shouldn't read too much into it. The indicator tracks the relationship between stocks and bonds. While there is not necessarily a consistent positive or negative correlation between stocks and bonds, we do see that when the two get extremely out of whack there is typically a snapback.
"The ratio on the site has now entered extreme territory,
suggesting that stocks are overvalued (for lack of a better word) while
bonds are undervalued. This is the first time since the beginning of
August that we have encountered this situation. There is still some
room for this ratio to work higher, however, as the trends in each
respective market extend themselves, but a shorter-term version of the
ratio that we watch is close to its practical maximum value."
The bears are disappearing. After 46% of those polled in the AAII
Investor Sentiment Survey said they were bearish last week, only 28%
were bearish this week.
Chart provided courtesy of
www.decisionpoint.com
I wish they had a poll for those who are bullish but are sitting in the
G fund like a deer caught in the headlights. Mark me down as a
yea.
There's really not much more to say. Technically the market looks
good but it needs a rest. The October jobs report may provide some
fireworks today. I am still waiting patiently for the market to
take that break. Maybe today?
Today's
Market Item is a great painting.
Have a peek.
That's all for today.
Currently
100% G fund. Thanks for reading.
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