SectorVue weekend comments for Monday August 3rd , 2009
Cash for Clunkers
The Dow Jones managed to gain 78 points while the NDX gained 4 points however
Action was negative. The Dow Jones led last week which is a bit of a problem as the
narrow index is easily painted.
Sector Action for the week was minus 881 with 23 Sectors up and 12 down. A rest and
successful test of Dow 9000 would be the most bullish in my opinion. Our Market
Barometer is now on an overbought Sell.
Rydex Alerts- Holding Bearish Russell.
Short term Trading indicator- Overbought !
Market Breadth – Breadth Oscillator on a SELL. Cumulative Breadth still rising.
INTERMEDIATE TERM TRENDS- Bullish
INTERMEDIATE OSCILLATOR - Topped out July 27th
Good earnings reports are exponentially rewarded as the herd piles on. Volume is light as is
expected this time of year. With short and intermediated term Oscillators very overbought or
flashing a Sell we would expect some down days to let off some steam. The cash for clunkers
success proves if you give them money they will spend. I suspect some college students are
getting a new car this month.
Cyclical CYC- Tops in overall rank which is a huge vote of confidence for the ‘recession
has ended’ crowd.
Broker Dealer XBD - Into the top ranks led by Goldman GS. It is nice to be one of the
‘chosen’.
Ultra ETF’s- BGU and TWM are tradeable.
Healthcare IHF IHI - Both rallied in overall rank. A good place to go fishing for high growth
stocks with sustainable earnings.
Housing HGX- Finally rallied in overall rank and price. I would not chase these stocks in
fact I expect them to settle down a bit.
Utilities UTY- Fell precipitously in overall rank as money goes to growth stocks and
inflation fears hurt dividend paying utilities.
Gold XAU- Back into bullish territory last week. Still holding Kinross Gold KGC.
Oil Patch XOI, XNG, OSX- dropped into the lower ranks which does not fit into the ‘all is
well in the economy’ camp. Above $75 bbl would be hurtful and below $50 means a
double dip recession.
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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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