TSP Talk Forums - Blogs http://www.tsptalk.com/mb/blog.php TSP Talk - Thrift Savings Plan en Thu, 18 Mar 2010 06:26:45 GMT vBulletin 60 http://www.tsptalk.com/mb/images/misc/rss.jpg TSP Talk Forums - Blogs http://www.tsptalk.com/mb/blog.php Get ready http://www.tsptalk.com/mb/blog.php?b=459 Thu, 18 Mar 2010 05:58:05 GMT Get ready For the pullback, sideways continuation, or the next leg up. Pick a card, any card... Here are some thoughts I have...
Get ready
For the pullback, sideways continuation, or the next leg up. Pick a card, any card...




Here are some thoughts I have regarding what's going on with these markets. It would appear money is flowing into bonds, so I'm asking myself "why is money flowing into bonds and stocks at the same time?" My guess would be that it's the Bears who are buying bonds, while they hedge against the next pullback in stocks. I say this because I'm seeing the Negative Volume index (NVI's smart volume) outpacing the positive volume index.

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Conversely, take a look at the NVI on the small caps, notice it's declining? That's just the opposite of what's going on with bonds.

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Now let's take a look at our leader the Transports. In my previous blog I pointed out a potential ascending triangle. I identified the price target with the red line. We met that target, pulled back, then pressed through, then pulled back again. Also, with .10% the Transports had the smallest gain on Thursday.

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Another thing. That pesky dollar has not given up at these levels. Check out the regression channels and how well they match up here.

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I'm invested, scared, but nevertheless still invested till price proves otherwise. Thanks...Jason
 ]]> JTH http://www.tsptalk.com/mb/blog.php?b=459 Let the Good Times Roll http://www.tsptalk.com/mb/blog.php?b=458 Wed, 17 Mar 2010 23:42:20 GMT And a good time was had by all...unless you're a bear of course. New 52 week highs were the order of the day today as the S&P made it three straight advances in as many days.

It's obvious economic data is of little import right now as the market didn't seem to react to today's releases. PPI for February dropped 0.6%, which was lower than expected, but Core PPI only advanced 0.1%, which was in-line with estimates.

Tomorrow morning, five economic reports will be released; Core CPI, CPI, Initial Claims, Continuing Claims, and Current Account Balance. I doubt we see much reaction to these either. Not with a market breaking out the way this one is.

Here's today's charts:

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NAMO moved a bit higher today, but remains on a sell (barely) and NYMO crossed its 6 day EMA flipping it back to a buy. Neither are extreme readings and I'm now expecting them to move higher given the underlying strength we're seeing in the market.

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Nothing bearish about either of these signals. They have breakout written all over them.

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TRIN and TRINQ flipped to sells, but are riding their 13 day EMA. Good news for bulls.

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Looks like we're going higher with BPCOMPQ although it's riding its upper bollinger band. At this point that's not a problem. The signal is on an upward trajectory and that's bullish.

Yesterday I showed you how the Top 15 were positioned going into today's trading. Today I'm posting the Top 50. They're starting to get conservative.

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So 4 of 7 signals are in buy territory and the system appears to be on a solid buy yet. It had looked a tad dicey prior the FOMC announcement, but not now. If you hadn't noticed, I took a 100% position in the S fund this morning. My patience to buy a dip just wasn't paying off. But that's okay. I suspect I'll make up for it when the next system sell signal is finally triggered.

See you tomorrow. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=458 A Non-Event http://www.tsptalk.com/mb/blog.php?b=457 Tue, 16 Mar 2010 23:41:46 GMT Yesterday I mentioned that I thought we'd see no surprises from the FOMC announcement and that the market would probably march higher as a result. Bingo, no surprises and fresh highs were established.

There are two economic reports on tap prior to tomorrow's open, Core PPI, and PPI. I'm not expecting any surprises from this release, so the trend should remain up, minor pullback notwithstanding.

The Seven Sentinels are now moving away from a potential sell signal given today's action, but any market surprises could change that. Here's today's charts:

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Still on a sell here, but I'm inclined to think we move sideways for a bit.

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Both signals flipped back to a buy today.

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Same here, two buy signals.

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Here's where it gets interesting. BPCOMPQ has intersected the upper bollinger band, but has not dropped below it. This makes me cautious as this is a trend signal which could flip to a sell with moderate selling pressure. But that does not necessarily mean the system itself will roll over should weakness come.

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The Top 15 raised more cash today. Here's a quick chart so you can see how they are positioned for tomorrow's trading activity.

So 5 of 7 sentinels are flashing a buy, which keeps the system on a buy. I am watching BPCOMPQ carefully now as it could flip to a sell quickly if enough weakness is generated. Then things could get dicey. But I am not yet looking for a system sell signal. If the market can work off its overbought condition with at least some sideways action I think we'll spring higher within the next few trading days. Or we could melt higher with the same result. That's it for today. See you tomorrow. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=457 <![CDATA[It's Getting Interesting]]> http://www.tsptalk.com/mb/blog.php?b=456 Mon, 15 Mar 2010 22:35:20 GMT The S&P managed to close out the days trading activity with a slight gain, but 1150 is acting as resistance as the index traded well below that level for a good part of the day.

A 0.5% gain in the dollar contributed to the I fund's overall weak performance today as it closed lower than either the C or S funds.

Interestingly, today's overall volume was low going into the FOMC announcement tomorrow, but there was a spike in up volume to close out today's session.

Industrial production for February was released today and it showed an increase of 0.1%, which was barely above what had been expected. Capacity utilization offered no surprises either. The Empire Manufacturing Index for March was a bit higher at 22.9 than the forecased reading of 22.0, but none of this data stirred much buying interest.

Senator Dodd made headlines today with a proposal for financial reform this afternoon, but even this did little to spook the market for long.

The Seven Sentinels are beginning to show signs of fatigue in the market, although I wouldn't say a sell signal is necessarily imminent. Tomorrow's FOMC annoucement could either revive a bid under the market and extend gains, or it could provide the catalyst for more weak trading. Here's the charts for today:

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These two signals sure look ready to begin a new down leg, but I'm not quite ready to make that call.

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Same thing here.

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TRIN and TRINQ are both flashing sells just like the all the above signals, but are very close to their 13 day EMAs and could go either way.

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BPCOMPQ, while still on a buy, could easily drop below the upper bollinger band and trigger a sell signal with enough selling pressure in the market. This could happen any day with downside follow through.

Overall, I'd say the system could flip to a sell condition tomorrow if we close the trading session down significantly. But the FOMC announcement makes it impossible for me to front-run a sell signal as there's no telling how the market will react. My guess is that there will be no surprises and hence we should move back up again, which should keep the system on a buy. While OPEX week can be volatile, I wouldn't expect any major technical damage this week. Next week gets trickier as post-OPEX is often weak, but we're getting close to the end of the quarter and window dressing may push the markets higher regardless.

So unless I get a clear sell signal from the Seven Sentinels I think it may be a good play to hold stocks for now. Once the FOMC announcement is past we'll know more about the very short term market condition, but until then there's reason to continue to be bullish. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=456 Top 4 http://www.tsptalk.com/mb/blog.php?b=455 Sun, 14 Mar 2010 04:01:13 GMT
Top 4
Transports, NASDAQ, S&P 500, & Small Caps




I don't have much to say about the American Markets, so I'll make it brief. Everything looks good, but we do have a couple of things I'll be watching going into next week.

On the 15 minute charts covering last week, the Transports (upper left) put in its 4331.26 high on Wednesday March 10th, and has tagged just short of this level 2 additional times. This could be a short-term Bullish Ascending Triangle . At the same time I don't want to mislead you as I have seen several examples last year when the Transports put in a swing high just before the rest of the markets did, leading into the next pullback. As you can see, the other 3 charts put in their highs early Friday morning.

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Here are the 60 minute charts covering the last 5 weeks since the March 5th swing low. On these charts I've drawn Raff Regression Channels. I use these channels to determine if prices are overbought, oversold, or on target. The middle line is a good way to determine the median price. As you can see from these 4 charts, we are right on target and everything appears fairly valued.

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On the Daily charts I've redrawn the Fibonacci levels to reflect the latest swing highs. With all 4 charts, the 20EMA is trading above the 50EMA and the 50EMA is trading above the 200EMA. I've been using a customized True Strength Index as an intermediate watch dog. When the green line dips into the red bollinger band, it will signal a momentum change. The PVI/NVI indicators are on target confirming this rally. They are both trading above their 9EMA (short-term) and the 9EMA is trading above the 13EMA (Short-Intermediate-term.)

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A little switch-up here. I may stop using the S&P 600 small caps and start using this Russell 2000 ETF. This is because the Russell 2000 ETF provides me the volume data I can't get with the S&P 600.

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Now here's where it gets murky. Here is the Daily Dollar ETF UUP. Once again I'm using this particular chart so I can show us the Volume data. The Purple line is the S&P 500. When the Dollar rises the S&P 500 tends to decline. When the dollar trades sideways or down the S&P 500 tends to rise. The point I'm trying to make is that the dollar is reaching a crossroads where it is trading at the bottom of it's rising long-term Raff Regression Channel and close to the bottom of the descending channel. In addition the True Strength Index and PVI have signaled a sell, while the NVI has held its ground.

Bottom line: If the Dollar continues to fall, I expect stocks to continue to climb and it will be a much needed boost for our I-Funders. However, if the Dollar decides to bounce off these levels of regression support, then I expect stocks to begin the next pullback.

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Thanks for reading, I'm still working on an I-Fund report, I'll likely post it in my account talk...Jason





 ]]> JTH http://www.tsptalk.com/mb/blog.php?b=455 TSP Talk Weekly Wrap Up - 03/13/10 http://www.tsptalk.com/mb/blog.php?b=454 Sat, 13 Mar 2010 19:04:52 GMT Weekly TSP Wrap-up from TSP Talk (http://www.tsptalk.com/) *Fork in the road* It was another good week for stocks as the major indices added... Weekly TSP Wrap-up from TSP Talk

Fork in the road

It was another good week for stocks as the major indices added to their 2010 gains, and all of the TSP funds ended in positive territory.

The C-fund was up 1.07% for the week, while the S-fund gained another 1.75%, and the I-fund added 1.29%. The F-fund (bonds) and the G-fund were up 0.12% and 0.06% respectively.



March continues to be a strong month as we are seeing gains in the stock funds between 4.2% and 6.7%. For the year, only the I-fund remains in negative territory while the S-fund is well out ahead at +9.18% in 2010. This illustrates why it is so important to understand the differences in the funds, as far as which are performing better, and why.

For the S&P 500, we are at a bit of a fork in the road. We have been watching the chart of the S&P 500 from early 2007 for clues to what might happen next, as that chart is very similar to what we are seeing today.

The comparisons between the above chart prior to the “you are here” arrow and today’s chart below are undeniable, except for one very important point: Today’s chart has not yet broken out above the prior high. That is important, because many times old highs act as resistance rather than breaking out.

.

Let’s take a look at another chart from 2007. It is from a little later in the year.


Charts provided courtesy of www.decisionpoint.com, analysis by TSP Talk

You can see that there was a similar “V” bottom that quickly ran up to test the prior high. It actually broke out for a few days, but quickly failed and pulled right back down toward the prior low. The significance of that move, other than the obvious weakness, is that the failed breakout point above happened to be the peak before the 2008 collapse in the stock market, so it was actually the perfect time to be a seller.

I would like to say that today’s technical picture is much stronger than what we saw at the peak of 2007, but unfortunately, although looking very good based on the moving averages, they are very similar. The key will be whether the breakout can occur, and also whether it will hold. Since many other leading indices have already broken out, I am leading toward a breakout for the S&P, but I don't want to dismiss the possibility of a double top.

We have some very important events scheduled on Tuesday of this coming week that could help determine which path we are about to take. Greece has a deadline on Tuesday to show the EU its plans on reducing their deficit, and that could determine whether or not they are going to be getting a bailout. No bailout could mean unstable market conditions across the globe.

Also on Tuesday is the Fed’s FOMC meeting where they will discuss interest rates and monetary policy. These meetings can be market movers.

Good luck, and thanks for reading. We will be back here next week with another TSP Wrap Up.

Tom Crowley
www.tsptalk.com

Weekly Wrap-Ups Archive

--------------------------------------
TSP Talk does not guarantee the accuracy or completeness of this report, nor does TSPtalk.com assume any liability for any loss that may result from reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice and are for general information only.

The information contained on this website is for educational purposes only and not intended to be recommendations, and may not be published, broadcast, rewritten or otherwise distributed without prior written consent from TSPtalk.com. Full Disclaimer ]]> tsptalk http://www.tsptalk.com/mb/blog.php?b=454 Weekend Update http://www.tsptalk.com/mb/blog.php?b=453 Sat, 13 Mar 2010 17:44:40 GMT The tracker has changed quite a bit in the past month or so. I'm talking about the whole tracker. Early on in January few folks had negative returns as the Santa Claus rally got extended. And then we had some serious selling pressure, which flipped the whole picture around as negative returns were the norm. Now we've had a big turn back to the upside and most folks have managed to get well again.

Here's how things look going into Monday's trading activity:

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The Top 50 continue to hold a significant stock position with the S fund easily leading the way.

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By comparison, the Top 15 hold almost double the cash reserves of the Top 50 and their stock allocations are much more evenly distributed. They're still maintaining a healthy exposure to the F fund too. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=453 No Storm Clouds yet http://www.tsptalk.com/mb/blog.php?b=452 Sat, 13 Mar 2010 00:20:22 GMT It was a pretty thin week as economic reports go. But the market continued its climb regardless of a lack of catalysts. I suppose we could attribute... It was a pretty thin week as economic reports go. But the market continued its climb regardless of a lack of catalysts. I suppose we could attribute it to momentum if nothing else. In spite of the fact that we've come a long way in a short period of time, I don't think we see any significant selling pressure for at least another week, and maybe not till early April. OPEX is next week and that should keep a bid under the market. We are also approaching the end of the 1st quarter so some window dressing may be in order. But again, after the run-up we've seen many traders may elect to close out the quarter early and not push their luck. Time will tell. To the charts:

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Are we seeing some topping action here? Perhaps, but there's a very good chance the first serious dip gets bought.

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More topping action? Maybe short term.

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Both have flipped to sells here.

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Still rising, but maybe getting ready to move sideways for a bit? Too early to really tell at this point.

So we have 4 of 7 signals on a sell, but the system remains on a buy until all 7 signals roll over to a sell at the same time. Looking at the signals I don't get the impression that's going to happen just yet. However, having said that I think most of this up-leg is now behind us, so I wouldn't expect more than a few more percentage point gains before we head back down again.

I'll post Top 15 and Top 50 charts tomorrow. See you then. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=452 One Strong Bull Move http://www.tsptalk.com/mb/blog.php?b=449 Thu, 11 Mar 2010 01:44:31 GMT I had a lengthy post all put together this evening and lost it just as I tried to post it. So I'm going to make this brief as my laptop battery is running low. I'll be showing only three signals this evening.

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In a word, toppy, but it could move sideways or even continue higher. Both signals are bouncing off their 6 day EMAs and look ready to weaken, even for a very short term.

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Very strong signal here, which tends to make me think weakness will be bought the first time we see any. But I'm more willing to buy the second dip than I am the first. OPEX is next week and I'm expecting more volatile action than we've seen lately. It's going to be tricky trading if you've been sitting in G of late. Be careful.

The system is showing all 7 signals on a buy, which keeps the system on buy.

I'm not sure I'll be posting tomorrow or not, but I should get to post by Friday at the latest. See you soon in any event. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=449 Price Pays http://www.tsptalk.com/mb/blog.php?b=448 Wed, 10 Mar 2010 05:23:40 GMT Price Pays But are you paying yourself? Technical indicators are a great tool, as is watching the news or reading the blogs. But I...
Price Pays
But are you paying yourself?




Technical indicators are a great tool, as is watching the news or reading the blogs. But I would like to point out that at times technical indicators fail, and all news casters will be wrong, as will be every blogger. I say this because I've noticed an increase in the griping about the low volume in the indexes. I agree, yes volume is low, but I care more about spikes in volume that marks tops, bottoms, and breakouts, than the general direction.

Case in point is this Monthly chart of the S&P 500. Volume started declining at the October 2007 peak, the weird thing is it's been declining ever since, including this latest bull run. The lack of volume does trouble me, but when you look at the Positive Volume Index (PVI) & The negative Volume Index (NVI) it helps to tell you what's going on.

You can think of the PVI as "follow the herd volume" because it measures increases in volume from the previous day. You can think of the NVI as the "smart volume" because it's declining volume quietly slipping out the back door while the dumb money is buying at the top.

Look at the PVI/NVI crossover. What I'm showing you on the chart is the PVI is us, or "the crowd" and what's happened is a whole boat-load of investors got shaken up and still aren't ready to commit their hard-lost savings. At the same time (and unusual) is it's the NVI that's been holding up these markets, quietly getting those great deals on Ford, AMD, and all the other great stocks fools like me bought at 2.00 and sold far far too early.

Simply put, investors just got out of a bad divorce, lost more than half of what they owned, and are in no hurry to get married to this market anytime soon.

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Monthly: Our fearless leader the Transports break into the Fibonacci "green zone" trading just above the 61.8% level.
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Monthly: I love tech and love to see our NASDAQ break into the Fibonacci "green zone" trading above the 61.8% level.
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Monthly: They say "Small caps lead the way." Well that certainly has proven true this month as the S&P 600 small caps (think S-Fund) were the first to break into the Fibonacci "green zone" trading just above the 61.8% level.
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Monthly: LARGE CAPS LAG!!! I'm skipping the S&P 500. Instead I'm going to break it up into two charts, showing you the S&P 100 Large caps & S&P 400 Mid caps. you should be able to see the huge difference and undersrtand why the S&P 500 has underperformed the other indexes. My theory with the Large caps lagging is that there is more "bang for your buck" value in the mid/small/micro caps.
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Thanks for reading. For more on the PVI/NVI and how to use them in your trading, here is a decent read.

Take care... Jason ]]> JTH http://www.tsptalk.com/mb/blog.php?b=448 Monday Bust? http://www.tsptalk.com/mb/blog.php?b=447 Tue, 09 Mar 2010 01:49:09 GMT Considering how most Monday's have traded in the past, today was downright boring. But after last week's gains should it surprise us?

No economic reports today, and none on tap for tomorrow either.

Today's charts:

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No real damage done here, still on a buy, but notice how high the 6 day EMA has risen. It could move higher, but every day increases the odds for some selling pressure.

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We're on a buy here too and the 6 day EMA is also climbing...fast.

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TRIN just did flip to a sell today, while TRINQ dipped lower, but remains on a buy.

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BPCOMPQ hasn't had a down day in a while and today was no expception. Still rising.

Not much change to either the Top 15 or Top 50 today so I'll hold off posting those charts for now. The Seven Sentinels remains on a buy and still see no chance of rolling over this signal. A dip is overdue, but I'm not so sure we'll see enough pressure to do a lot of damage. But that's today's read, and things could change quickly. But until they do we're probably moving higher.

I will be on travel starting tomorrow so my posting will be sporatic. It's possible I may not get to post in my blog at all, so if that happens I'll try to make some comments in my account talk thread instead. Until then, have a great evening. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=447 Weekend Update http://www.tsptalk.com/mb/blog.php?b=446 Sun, 07 Mar 2010 19:12:06 GMT Time to take a look at the Top 15 and Top 50 going into this week's market action.

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We can see that this past week the Top 15 got defensive, dropping their collective stock exposure from just under 70% to a little over 40%. Bonds have found a lot of favor here too with a 20% allocation. The collective position here is well hedged for any action.

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The Top 50 on the other hand, have about a 75% stock allocation (with the S fund the overwhelming favorite), very little bond exposure, and a moderate cash position. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=446 TSP Talk Weekly Wrap Up - 03/06/10 http://www.tsptalk.com/mb/blog.php?b=445 Sat, 06 Mar 2010 17:52:05 GMT Weekly TSP Wrap-up from TSP Talk (http://www.tsptalk.com/) *A good week for the TSP stock funds* Stocks rallied sharply last week, punctuated... Weekly TSP Wrap-up from TSP Talk

A good week for the TSP stock funds

Stocks rallied sharply last week, punctuated by a big rally on Friday, which was triggered by what was apparently a better than expected jobs report.

For the week, the C-fund gained 3.12%, the S-fund surged 4.85%, and the I-fund added 4.01%, as the rally in the U.S. dollar lost some steam. The F-fund (bonds) slipped 0.10%, and the G-fund added 0.04%.



March is off to a good start as the C-fund is now positive for 2010, while the S-fund continues to lead the way with a 7.3% gain for the new year, but the I-fund is still lagging and down 1.3% in 2010, as the strength in the dollar has been holding it back. The F-fund is up 1.8% this year, and the G-fund is up 0.58%.

We have been watching with interest, the comparison between the chart of the S&P 500 from early 2007, and the current chart. We talked about it last week, and to be honest, I did not think we would still be talking about it this week. It always seems that once you find a pattern, it is usually about to end, but this one is still going.

........
Chart provided courtesy of www.decisionpoint.com, analysis by TSP Talk

I hate to be too picky, but we did not get that little dip down to the 20-day EMA (green line) that we saw in 2007 between points "F" and "G", as the S&P 500 seems to be going directly to "G". Whether we do pullback or just continue past "G" as the 2007 chart did, remains to be seen, but if we are still talking about this next week, we can consider ourselves very fortunate to have a copy of what appears to be a treasure map.

From a technical analysis perspective, things are going swimmingly. If there is a concern for the coming week it is that there is a tendency to see a reverse of rallies that are triggered by a surprise in the jobs report. (The opposite is also true - sell offs after a negative surprise tend to get reversed). This could be that pullback to the 20-day EMA.

This week could also see some volatility as we head toward the March 16 deadline for publication of the Greek timetable on measures to correct their deficits. This crisis in Greece is not over.

Good luck, and thanks for reading. We will be back here next week with another TSP Wrap Up.

Tom Crowley
www.tsptalk.com

Weekly Wrap-Ups Archive

--------------------------------------
TSP Talk does not guarantee the accuracy or completeness of this report, nor does TSPtalk.com assume any liability for any loss that may result from reliance by any person upon any such information or opinions. Such information and opinions are subject to change without notice and are for general information only.

The information contained on this website is for educational purposes only and not intended to be recommendations, and may not be published, broadcast, rewritten or otherwise distributed without prior written consent from TSPtalk.com. Full Disclaimer ]]> tsptalk http://www.tsptalk.com/mb/blog.php?b=445 Pop the Corks! http://www.tsptalk.com/mb/blog.php?b=444 Fri, 05 Mar 2010 23:51:49 GMT We "only" lost 36,000 jobs! Break out the champagne! :rolleyes:

Nonfarm payrolls fell 36,000, which was better than the 68,000 that was forecast. The unemployment rate remained at 9.7%, which beat the 9.8% forecast. The underlying data suggested there was some job creation too.
But that increase is due to part-term workers being hired more than anything else and is certainly not indicative of a jobs picture getting better. I wouldn't call this data point more than neutral at best.

My message of late has been that the Seven Sentinels do not look like they are going to roll over. I certainly got that right today. In spades. But I've been expecting some short term weakness in any event and on that count I've been wrong. At least so far. Looks like we're going to get some extended technical readings and when that happens things could get silly.

Here's the charts:

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We're hitting some rarefied air now. This is the highest these two signals have been since early April of 2009.

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Back in the saddle here. Flipped to buys.

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Yes, these are both buys, but TRIN in particular is showing overbought conditions, but it can go lower, and Monday's coming.

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Higher still. Very bullish.

The system is showing 7 of 7 buy signals. There's nothing wrong with this picture. It's bullish, but we're still due for some profit taking. But given how today's action went I wouldn't short the market on Monday. I think this market is now gunning to establish new highs since the March low.

If you've been holding since the last Seven Sentinels buy signal, you're doing very well. This has been a very strong signal. But if you're waiting for an entry point like me you're caught in no man's land at the moment given the overbought conditions. But we could get more overbought before we see any give back too. For now, I continue to wait this out. I'll post the Top 15 and Top 50 charts later this weekend. See you then. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=444 Drum Roll Please http://www.tsptalk.com/mb/blog.php?b=443 Thu, 04 Mar 2010 23:42:55 GMT Another lackluster, low volume trading day, but a late day rally did help the major indicies post modest gains by the close in any event. In... Another lackluster, low volume trading day, but a late day rally did help the major indicies post modest gains by the close in any event.

In today's data releases, pending home sales for January fell 7.6% vs an expected 1.0% monthly increase. January factory orders were up 1.7%, which was close to what was expected. Fourth quarter nonfarm productivity hit 6.9%, but was not much higher than the expected 6.3% target, and finally unit labor costs dropped 5.9% vs and expected 4.5%.

The dollar moved higher today gaining 0.7%, while the VIX dropped yet again, hitting 18.72 at the close. This after being higher most of the day.

It's all about Friday's non-farm payrolls report now, which is being blamed in large measure for the market's seeming lack of either buying or selling conviction.

Today's charts:

Name: NAMO.jpg Views: 405 Size: 90.4 KB

Still toppy, and both still on a buy.

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Not so with NAHL and NYHL. Both flipped to sells today.

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TRIN and TRINQ remain on a buy.

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BPCOMPQ higher still. This is a trend indicator and is currently bullish.

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Our Top 15 got more defensive going into tomorrow's action. They do have a 40% stock exposure, but a 20% bonds reading may be giving us at least some clue.

So here's my read. I think the market is finally ready to make a move as the much anticipated nonfarms payroll data comes out tomorrow. That will probably be the catalyst to drive this market in one direction or the other, possibly in a big way. Trader's Talk sentiment survey for tomorrow is showing 50% fully long and 0% fully short bears. Sentiment is 58.3% bulls and 16.67% bears. This is an early read and could change by the morning. Also, these are day-traders, so they could be right for at least an intra-day trade. But sentiment is a fade right now, so while we may rally initially, don't expect it to last. VIX is a sell. NAMO and NYMO are still looking toppy, but BPCOMPQ continues to indicate that the trend is up.

What this all tells me is look for very short term weakness. That doesn't mean we can't make a big move higher to start the trading day tomorrow, but I suspect the selling will kick in intraday if not immediately. And the selling could last until Monday given that it's almost a given anymore that Monday's are green.

But I don't think we sell off enough to trigger a Seven Sentinels sell signal. So I am inclined to think a buying opportunity is at hand. The signals support very short term selling, but nothing to suggest rolling over at this point. Not with BPCOMPQ ramping up. I'm just not seeing a sell signal set-up here.

Our Top 15 holding 20% bonds and 40% cash tells me much the same thing. Bonds should spike upward in a sell-off and some of those traders are positioned for that. And 40% cash is ready to be deployed on a good dip. I like their collective position right now.

It's going to be an interesting day tomorrow. Good luck on your trading decisions and see you tomorrow. ]]> coolhand http://www.tsptalk.com/mb/blog.php?b=443