Coolhand's Market Analysis

Last week, I showed you a chart that revealed seventeen weeks this year when total stock allocations from the auto-tracker fell from the previous week. The accuracy rate for stocks to fall after a weekly drop in stock allocations was only 24%. And stock allocations were down 6.78% at the beginning of last week, which was bullish by this measure. And so the market rallied on those odds again. This week, allocations are down once more. And so the odds favor more upside. Here's the charts:




No signal from the Top 50 this week. For the new trading week, total stock allocations rose by 3.6% to a total stock allocation of 90.4%.




No “official” signal was generated from the Total Tracker this week. But as I mentioned earlier, the odds favor a rally when total stock allocation dip across the Auto Tracker (Total Tracker) in any given week. And this week, they fell by 1.09% to a total stock allocation of 41.67%. By this measure, the odds favor higher prices for the coming week.



Price on the Wilshire 4500 (equivalent to the S fund) is not far from hitting fresh all time highs, but it is also nearing resistance. Momentum is now positive and rising. RSI is showing moderate strength.*

Our Our sentiment survey saw a few more bulls and couple less bears, but is a neutral reading in my view. The AAII sentiment survey came in with a lot more bulls and a few less bears. The jump in bulls was bearish for next week. This tells me we will likely get some measure of selling pressure next week, but that any weakness should probably be bought. I say this because the technical picture is looking much better, although it is a bit extended in the short term. The intermediate term trend is up and underlying market support is strong at this time.

To see this week's full analysis, follow this link http://www.tsptalk.com/members/