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The Wilderhill Clean Energy Index is trying to hold the line at the 180 area.
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Crude oil prices are trying to hold above $50, and cold weather is helping in the shortterm.
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The Philadelphia Oil Service Index (OSX) has broken below the 200 area, and is due for abounce.
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The Amex Oil Index (XOI) made a new low on 1-10, but has since bounced back. 1200 is thekey chart point.
Technical Summary:
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Nasdaq Extends Breakout
New!! Visit our Large Cap Growth portfolio. Click on the S & P 500 timing and LargeCap Growth link on the left navigation bar.
Growth stocks are back en vogue, just in time for our new portfolio, as described above.
Nasdaq finally took out the longstanding resistance area at 2500, closing above the keychart point last week.
The Dow Industrials and the S & P 500 also made new highs, as did the NYSE advancedecline line, again giving the up trend a new lease on life.
Technology stocks and growth stocks are leading the way, with a broad set of sectorsparticipating.
Our technology sections, both the ETF driven Tech Timing Models, and our individual stocksection, the Technology Investor, are full of new picks and updates.
The chip stocks, in particular, are acting increasingly well, and should be exploredfurther over the next few days.
Our Fallen Angels section also has some positions in technology that are worth exploring.
Our long term forecast remains upbeat, unless the major indexes fall convincingly belowtheir 200 day moving averages.
What To Do Now
It's time to look at growth stocks as the potential new wave in the market, although somevolatility is still possible.
There are also opportunities in other markets.
Our bond, energy, gold, and dollar timing models have all been updated and should bechecked regularly for trading opportunities.
Visit our individual sections, both our ETF and individual stock picks daily for newideas, and changes to open positions.
Be very methodical about monitoring portfolios, adhering to trading rules, and ratchetingup sell stops is clearly still here.
If the market turns south, your chances of preserving your profits by following a soundtrading plan, such as outlined above will increase.
Second guessing decisions, and hoping that things will turn out o.k. in the long haul, isthe recipe for disaster at a time like this in the market.
Check all our sections daily. See tech, biotech, Fallen Angels, and timing systems forthe latest adjustments. Our ETF trading systems for energy, Spyders, Small Caps, andtechnology have also been updated.
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Sentiment Summary:
Ratios Remain Low But Deliver No Sell Signals
Optimism remains cautious in the options market.
The CBOE Put/Call ratio checked in at 0.75. A consistent string of low readings can be asign of excessive optimism and often signals a top in the markets. Readings below 0.5 areof concern, but not as serious as readings below 0.40. Readings above 1.0 are bullish. Thenumbers cited here are meant to be evaluated on a closing basis.
The CBOE P/C ratio for indexes checked in at 1.13. Numbers above 2.0 as the market sellsoff, often lead to rallies. Readings below 0.9 suggest too much bullish sentiment, just asreadings above 2 are usually required to mark major bottoms.
The VIX and VXN had readings of 10.15 and 16.56. A fall near or below 20 on VIX and 30-40on VXN is considered negative, a fact that is usually confirmed when the volatilityindexes begin to rise. Readings above 40 and 50, respectively, are often signs that abottom may be close to developing.
NYSE specialists bought stocks fairly aggressively on 12-29-06. Specialist short sellingremained at very low levels, though. Rising short selling from specialists is usually avery bearish sign.
Market Vane's Bullish Consensus remained at sell signal levels, checking in at 68% 1-12.The UBS sentiment index also delivered a very cautionary reading of 93 for the month ofNovember, and followed it with a reading of 90 for December.
Market Moves
Merrill Lynch And Goldman Sachs Return To Winner's Circle
Merrill Lynch (NYSE: MER) and Goldman Sachs (NYSE: GS) made new highs on 1-12, suggestingthat the market still has more gains ahead.
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As Merrill and Goldman go, Wall Street often follows. This makes sense, given the rolethat the two big brokers play.
Goldman is the key to mergers and acquisitions, while Merrill, a big investment bank onits own, also runs mutual funds and a large retail brokerage operation.
When these two stocks rise, it is a sign that traders are still confident in the bullmarket.
Based on traditional valuations, the pair is still cheap, with Goldman selling at 12 timesearnings and Merrill at 14.
Both are making plenty of money, and should continue to do so for at least a few morequarters, barring a major surprise either inside or outside the companies.
Nothing is certain. But, in a bull market, you want to see these two stocks acting well.
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The Amex Biotech Index (BTK) is showing increasing strength. The 780-800 area is importantresistance.
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The Amex Pharmaceuticals Index (DRG) is starting to straighten out slightly.
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The Philadelphia Semiconductor Index (SOX) may have found support near the 450-470 area.480 is still key resistance.
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Small stocks are showing some weakness in early 2007, and are not keeping up with theNasdaq.
