Monday March 22nd , 2010
Bracket Buster
The Dow Jones closed up 117 points while the Nasdaq 100 NDX gained 8 points for the
week. The Russell RUT index slipped 3 points and all broad based indices had negative
Action.
Sector Action for last week was minus 799 with 20 Sectors up and 15 down. Negative
Action usually precedes a drop in price The Market Barometer crossed over giving a Sell
signal. (see graph on page 4)
Rydex Alerts-loaded up on Bearish Russell at the close Wednesday which is perfect timing
so far.
Short term Trading indicators- Overbought
Market Breadth - Cumulative Market Breadth is still rising.
INTERMEDIATE TERM TRENDS- Bullish.
INTERMEDIATE OSCILLATOR - Overbought Sell
With Kansas getting beat by Iowa St most March Madness brackets are broken. It remains to be
seen what will upset the stock market at these lofty levels. Longer term it would be better if the
market pulled back a bit and took a rest digesting recent gains. Beware the momentum players who
have pumped up stocks over the last few weeks will be quick to exit on any sign of a downturn. In
fact the -799 Action number tells us institutions are already taking profits and trimming positions.
Healthcare Providers IHF- top rank with a big move anticipating passage of the
healthcare bill and 20 million new customers. Obviously this will play out over the next few
weeks as investors (and Congressmen) read the bill but in general being able to tap the
Federal checkbook has been good for business.
Defense DFI- steady gains and a move up to 3rd in overall rank. See above comments
on tapping the Federal checkbook
Internet DOT and Networking NWX - topped out in rank and price. We took profits on
our Juniper JNPR holding and it has been down every day since.
Ultra ETF’s- SSO and TWM are tradeable however the daily range is now below $1
Oil Patch OSX XNG XOI- Natural Gas XNG and Oil Service OSX caught down to Oil
XOI. While the price of oil could break out to $100 bbl these numbers suggest otherwise.
Agribusiness MOO- Fell back into the lower ranks as Potash POT filled its 120 to 128
price gap.
SectorVue and Rydex alerts are for educational purposes only and do not constitute 'investment advice'.
No representation is made that strategies will produce a profit.
There is risk of loss in all trading.
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