SectorVue weekend comments for Monday January 4th, 2010
Forever Stamp
The Dow Jones finished the short week down 92 points, the NDX fell off 9 points and the
Institutional Index XII took a nose dive as institutions took profits hitting the Sell button
the last few days of the year.
Sector Action for the week was minus 11215 with all 2 Sectors up and 33 down. The
Market Barometer rolled over and appears headed for bearish territory.
Rydex Alerts- We went into bearish positions as the market rolled over Tuesday.
Short term Trading indicators- Short term Sell
Market Breadth - Cumulative Market Breadth is pausing and needs to advance this week or we
are due for a slip on the ice.
INTERMEDIATE TERM TRENDS- Neutral
INTERMEDIATE OSCILLATOR - Still in Bullish territory. Was last week a pause to refresh
or a top?
A lot of economics can be summed up in whether The Liberty Bell ‘Forever stamp’, which cost 41c
in 2007 is a good buy or not. The stamps now cost 44c, up 7%. So far so good. I don’t know if they
can be sold back to the Postal Service en’mass but if you could resell them a government
guaranteed investment up 7% would have outperformed just about everything else for the last two
years. Going forward ‘good buy or not?’ lends to a discussion of inflation, competitive government
services and of course the need for stamps at all in the new ecommerce world.
Disk Drive DDX- Still top ranked. Sandisk SNDK and Western Digital WDC eased last
week and need to reassert themselves as leaders this week.
Technology TXX- Same story here as the most visible stocks - Apple AAPL, Amazon
AMZN and Google GOOG are THE bellwethers this week telling us if institutions are
buying or selling the market.
Biotech BTK- rallied into the top ranks which is a good sign for Nasdaq growth stocks.
Cephelon CEPH was the leader.
Ultra ETF’s- SSO and TWM are tradeable. The first week of the year is usually
volatile.
Oil Patch XOI, XNG and OSX - Fell in price and rank last week. The profitability and
price of these stocks depends on world economic activity. If things are getting better
economically it will support the price of oil and these stocks. We own Sunoco SUN which
has a nice divided while we wait.
Banks BKX, Capital Mkts KCE and BrokerDealers- still dead last in overall rank. We
own Wells Fargo WFC. The question remains did we save the banks or relegate them to
life support in the foreseeable years?
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representation is made that strategies will produce a profit.
There is risk of loss in all trading.
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