4 replies to this topic

[Douglas]

According to my risk summation system, there is a risk window at the front of next week, say Tuesday the 26th thru about noon on Wednesday the 27th and one at the end of the week, say noon on Thursday December 28th thru Friday the 29th, in other words most of the cotton picking four day week, not much use, but as I like to say, it is what it is.

 

Last week the Tuesday through about noon on Wednesday risk window tagged the high before the plunge out of nowhere.  A determination whether the high in the Friday the 22nd risk window amounts to more than a hill of beans will have to wait for trading Tuesday.   

 

My wife gave me covid for Christmas, I guess it's not too much worse than the knitted sweater present last Christmas.  The new variant is apparently roaring through the UK with several of my friends here on the south coast succumbing.  Haven't heard of anyone having to go the hospital for this variant, just like a very bad cold or the flu.  No sign of masks or new government edicts yet.  

 

Regards,

Douglas  

 

 

[Douglas]

Where does the current straight up rally run out of steam?  One relatively close-by possibility is shown below at roughly 38000 and small change where the "C" equals the "A" wave measured from the low of "B" if this is indeed a correction.  In order for this target to work out, something would probably have to happen to jam the gear works of the flood-the-market-with-stimulus-money-and-raise-rates Fed/Treasury amalgamation plan to deal with inflation.  Sentiment is getting just a bit tilted to the greed side as can be seen in the plot of an average of several sentiment gauges at the bottom which might provide the push to get the ball rolling downhill.  

 

 

 

Regards,

Douglas

[Douglas]

In the vein of putting their money where their mouth is, the NAAIM (National Association of Active Investment Managers) equity exposure index below fills the bill.  Sentiment surveys could just be opinions, but NAAIM is where the rubber hits the road and they've been hitting it pretty hard lately.  It can certainly go higher and some past high values seen below were just weigh stops on the path to higher prices, but the current value does represent elevated risk. To quote Clint, do you feel lucky, punk?

 

 

Regards,

Douglas

Edited by Douglas, 24 December 2023 - 05:24 PM.

[OEXCHAOS]

In the vein of putting their money where their mouth is, the NAAIM (National Association of Active Investment Managers) equity exposure index below fills the bill.  Sentiment surveys could just be opinions, but NAAIM is where the rubber hits the road and they've been hitting it pretty hard lately.  It can certainly go higher and some past high values seen below were just weigh stops on the path to higher prices, but the current value does represent elevated risk. To quote Clint, do you feel lucky, punk?

 

 

Regards,

Douglas

I agree. They HAVE raised exposure levels far higher, than currently. I have seen them with 75% of all advisors at LEAST 100% long, and more than 50% MORE than 100% long. And it still took a while to top out.

We do need to remember that these guys are pros, and most are about as talented as our best IT traders.

 

Still, when we're all leaning too hard, the boat can tip, no matter how good our sea legs are!

[Douglas]

Mark, I completely agree.  A series of high NAAIM readings each followed by higher index prices can be seen in the 2020 bull market in the plot below which was driven by the Fed/Treasury super money pumping during covid.  The market would only turn down a couple of weeks at most after the NAAIM peaks after which the index would turn back up to new highs.  The Fed is once again in pump mode having declared victory in its fight with inflation.  It is entirely possible that the 2020 experience shown below will be repeated in 2024 with money managers getting bullish repeatedly as prices swing higher.  This is not my current forecast for 2024, but I must admit that it is a distinct possibility given the propensity of governments to pump money into the system in front of the upcoming elections across the globe in more than 40 countries including the US, UK, Taiwan, Russia and India, .

 

  

 

Regards,

Douglas