Click Here to Subscribe Now! Try a 3-month trial for only $68

Quote of the Day

Thursday, March 08, 2012

March 8, 2012 -- Ah, at last we have some checkpoints which will identify the trend. On Feb. 28 the Dow closed at a high of 13005, while on March 1 the Transports closed at 5211. From there the market dropped off to a March 6 low of Dow 12759 with the Transports on March 6 at 5047.


Dow 13005 (Feb 28) Trans. 5211 (Mar 1) --- the highs

Dow 12759 (Mar 6) Trans. 5047 (Mar 6) --- the lows


The critical question -- Whichever pair the Averages can jointly better will identify the trend. Remember, both Averages must better their highs or lows. A non-confirmation would be significant and might set the market up for a reversal.


As I write, the Dow is only 113 points below its high, but the Transports are lagging a bit. According to Dow Theory, the market has suffered a mild secondary correction. Whichever way the Averages break out of the secondary boundaries will identify their main trend.


Gold has done its work in scaring latecomers out of the metal. The action now is above the declining trendline, which is positive. It will take a lot of work and time to keep gold above 1700 and then to new highs.






Distribution days over the last two weeks -- 5 on the NYSE; 4 on the S&P 500; 3 on the NASDAQ. That's a lot of distribution days, indicating institutional selling.





My PTI was up 6 at 6385. The moving average at 6350, so my PTI is bullish by 35.


The Dow was up 70.61 to 12907.94.


Transports were up 72.28 to 5145.94.


Utilities were up 1.02 to 453.20.


NASDAQ was up 34.73 to 2970.42.


S&P 500 was up 13.28 to 1365.91.


There were 2427 advances and 622 declines on the NYSE.


There were 121 new highs and 8 new lows.

April light crude was up 0.42 to 106.58.


Total Volume on the NYSE and associated exchanges was 3.4 bn.


Bonds: Yield on the 10 year T-note was 2.01. Yield on the long T-bond was 3.17. Yield of the 91 day T-bill was 0.081%.


Dollar Index was down 0.54 at 79.16. Euro was up 1.24 at 132.73. Yen was down 0.62 at 122.52. Currency Prices as of 1 PM Pacific Time.

April gold was up 14.80 to 1698.70. May silver was up 0.24 to 33.83.


My Most Active Stocks Index was up 11 at 294.


The Big Money Breadth Index was up 8 at 1024.


GDX was up 0.65 at 53.32.


HUI was up 6.55 to 509.42.


CRB Commodity Index was up 1.80 at 316.04.


The VIX was down 1.12 to 17.95.


Permanent Portfolio Fund (PRPFX) was up 0.24 at 48.58 (previous day closing). YTD Return: 5.40%.


Late Notes -- No joint upside breakouts in the Averages yet.


Gold up 16 dollars just before the close, but closed +14.80 to 1698.70, just shy of the 1700 level. You can't keep a good currency down.



CHART BOOKS AND CHART PAGES 2011. Don’t ask me why but in an industry that involves trillions of dollars, nobody else does this. What I’m talking about is chart books of the D-J Averages and another chart book of the all-important breadth index (i.e. advance-decline ratio). I’ve been offering these two chart albums for decades, and I feel they’re invaluable. Actually, I started these albums back in the ’60s because I needed the data myself. The first volume is a complete daily history of the D-J Averages (all three Averages plus bonds and volume) going back to 1885. Important economic and world events are noted on each page. The charts are packed in a big three-ring, hard cover binder, one 12”x17” page for each year.


The Dow Jones album is yours for $140; we pay the postage in the States. The second album covers the Dow and the extremely important A-D ratio (daily) going back to 1931. Comments regarding the action are included in many of the pages (one 12”x17” page for each year). The A-D album price is $100, we pay US postage. There’s an extra postage charge of $40 for albums mailed outside the US.


For those who own our chart books, the new 2011 pages are almost ready, and the price is $10 for the page of the D-J Averages and $10 for the new A-D ratio page. Please send your money in now; we do not accept credit card orders under $50. Send your checks (drawn on a US bank in US Funds) to Dow Theory Letters, PO Box 1759, La Jolla, CA 92038.