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Quote of the Day

Thursday, April 12, 2012

April 12, 2012 -- "Happiness does not lie in happiness, but in the achievement of it." Fyodor Dostoevsky

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These stock and bond markets may not make us happy, but we might as well get used to them, because they're all we've got!

 

I've had a lot of time while in bed to watch TV and particularly Bloomberg. And I note that 90% of the time the so-called experts try to predict the path of the stock market by the way the current news is going. If the news is getting better and unemployment is looking brighter, then the stock market "should" be rallying. If the European picture is darkening, then the market "should" be shaky to weak. Follow the fundamentals, not the market!

 

So far, the stock market isn't giving off any definitive hints as to what it's doing or which way the trend is heading. I study my PTI, and its last trend signal was bullish. But as you may have noticed from the recent point and figure chart, my PTI has not been climbing to new highs. Instead, it's forming a column of descending metrics, although it has NOT yet issued a clear bear signal.

 

Lowry's Selling Pressure Index is still above their Buying Power Index, a formation that always bears careful watching. Joe Granville's on-balance-volume statistics remain bearish as does Joe, and I always take Granville's work seriously. My astute friend, A. Gary Shilling, is bearish because he thinks US consumers have exhausted their buying power.

 

Actually, the reason I so frequently talk about Lowry's and Granville is that they are about the only two who stick strictly to technical analysis of the stock market while putting the market first and ignoring all the news of the day and the much-talked about fundamentals.

 

I note that the futures in the Dow are almost always the opposite of the way the market has closed. If the market closes down, the futures are usually higher, and the opposite is true if the stock market closes higher. BUT, if the market closes higher and the futures are higher, it usually means that next day will be a positive day.

 

This is a grinding back-and-forth market, one that is better to watch than to play.

 

TODAY'S MARKET ACTION:

 

My PTI was up 6 at 6387. The moving average at 6368, so my PTI is bullish by 19.

 

The Dow was up 181.19 to 12986.58.

 

Transports were up 119.80 to 5248.20.

 

Utilities were up 2.37 to 453.39.

 

NASDAQ was up 39.09 to 3055.55.

 

S&P 500 was up 18.86 to 1387.57.

 

There were 2505 advances and 549 declines on the NYSE.

 

There were 66 new highs and 16 new lows.

 

Total Volume on the NYSE and associated exchanges was 3.5 billion.

 

Bonds: Yield on the 10 year T-note was 2.062. Yield on the long T-bond was 3.217. Yield of the 91 day T-bill was 0.091%.

 

Dollar Index was down 0.48 at 79.31. Euro was up 0.96 at 132.00. Yen was up 0.16 at 123.84. Currency Prices as of 1 PM Pacific Time.

June gold was up 20.30 to 1680.60. May silver was up 1.00 to 32.52.

 

May light crude was up 0.94 to 103.64.

 

My Most Active Stocks Index was up 11 at 300.

 

The Big Money Breadth Index was up 8 at 1028.

 

CRB Commodity Index was up 3.51 at 305.61.

 

The VIX down 2.82 to 17.20.

 

Permanent Portfolio Fund (PRPFX) was up 0.07 to 47.97 (previous day closing). YTD Return: 4.08%.

 

Late Notes -- The Dow shot up just to its 50-week moving average. Transports joined the return run and ended the session just above their 50-day MA. My PTI remains bullish, which means that the Dow still has a chance to test its April high of 13,264. The market remains in the hands of the hedge funds who are desperate to chalk in some rare profits, and I mean they are rare.

 

June gold ended up 20 dollars to 1680, and continues to trade bullishly above 1600.