主题：04/08/2009 Market View -- 宁子

MARKET SENTIMENT

VIX: 38.85; -1.54

VXN: 40.5; -0.57

VXO: 39.27; -0.84

Put/Call Ratio (CBOE): 0.85; -0.11

Bulls versus Bears:

This is a reading of the number of bullish investment advisors versus bearish advisors. The reason you look at this is that it gives you an idea of how bullish investors are. If they are too bullish then everyone is in the market and it is heading for a top: if everyone wants to be in the market then all the money is in and there is no more new cash to drive it higher. On the other side of the spectrum if there are a lot of bears then there is a lot of cash on the sideline, and as the market rallies it drags that cash in as the bears give in. That cash provides the market the fuel to move higher. If bears are low it is the same as a lot of bulls: everyone is in and the market doesn't have the cash to drive it higher.

This is a historical milestone in the making. Bulls are impressively low considering we are in general a very optimistic country. The few bulls is a positive indication because it means most everyone that is getting out is out and there is money on the sidelines. In other words the ammunition boxes are full and as the market recovers investors will start opening up the boxes and firing. Little by little they will be forced to put more money into the market and there will be some rushes higher in fear they are missing the train. You relish times when sentiment is so negative because it means some tremendous buys are setting up. This could indeed be the opportunity of a lifetime, and you take advantage of it by buying quality stocks and letting them work for you as long as they will. If we can hold them for years, great.

Bulls: 31.0%. A little rally and a climb in the bulls, up from 28.9% and jumping over the highs a month back at 29.7%. Still well below the 43.0%, the prior top of the recovery as the market rallied off the November low. A rise from 25.3% in December and quickly starting to fall once the market encountered the January selling. Bullishness bottomed on this leg lower at 21.3% in November 2008. This last leg down showed us the largest single week drop we have ever seen, falling from 33.7% to 25.3%. Hit 40.7% on the high during the rally off the July 2008 lows. 30.9% was the March low. In March the indicator did its job with the dive below 35% and the crossover with the bears. A move into the lower 40's is a decline of significance. A move to 35% is a bullish indicator. This is smashing that. For reference it bottomed in the summer 2006, the last major round of selling ahead of this 2007 top, near 36%, and 35% is considered bullish.

Bears: 38.0%. Quite the drop from 43.3% and 44.3% the prior week. The decline was slowing its fall from 47.2%, the peak for the run this year but no more. Hit the 34's on the lows, falling from 38.5% and 46.2% in mid-December. Still above the 35% level considered bullish for stocks. Bearishness hit a 5 year high at 54.4% the last week of October 2008. The move over 50 took bearish sentiment to its highest level since 1995. Extreme negative sentiment on this move. 35% is the level that historically indicates excessive pessimism. As with the bulls the jump in bears did its job after hitting 44.7% in the third week of March. Bearishness peaked at 37.4% in September 2007. It topped the June 2006 peak (36%) on that run. That June peak eclipsed the March 2006 high (33%) and well above the 2005 highs that spawned new rallies (30% in May 2005, 29.2% in October 2005). This is a huge turn, unlike any seen in recent history.

NASDAQ

Stats: +29.05 points (+1.86%) to close at 1590.66

Volume: 1.796B (-0.54%)

Up Volume: 1.485B (+1.3B)

Down Volume: 357.931M (-1.24B)

A/D and Hi/Lo: Advancers led 2.58 to 1

Previous Session: Decliners led 3.04 to 1

New Highs: 6 (+1)

New Lows: 10 (-4)

NASDAQ CHART: http://investmenthouse.com/ihmedia/NASDAQ.jpeg

After a two-day pullback to the 10 day EMA NASDAQ bounced. NASDAQ started higher then came back to test the 10 day on the low and then started back up. That is that intraday third day test, sort of, and it was enough to push NASDAQ higher. It tapped at 1600 on the high but did not try to take it out. No volume to do that and thus NASDAQ remains below the February peak, but still in the uptrend and trying, though without volume, to put in a higher low.

SOX (2.89%) put in its own recovery, testing near the February peak and resuming the upside. That took it back over the January peak again and back toward the November high it took out last Friday. Not a lot of strength in volume, but chips remain a strong leadership sector in the market, indeed likely the strongest.

NASDAQ 100 CHART: http://investmenthouse.com/ihmedia/NASDAQ100.jpeg

SOX CHART: http://investmenthouse.com/ihmedia/SOX.jpeg

SP500/NYSE

Stats: +9.61 points (+1.18%) to close at 825.16

NYSE Volume: 1.316B (+4.26%)

Up Volume: 954.672M (+755.474M)

Down Volume: 346.01M (-707.288M)

A/D and Hi/Lo: Advancers led 2.73 to 1

Previous Session: Decliners led 3.54 to 1

New Highs: 4 (0)

New Lows: 48 (-1)

SP500 CHART: http://investmenthouse.com/ihmedia/SP500.jpeg

SP500 was no powerhouse though it did bounce off the 10 day EMA and tap the 90 day SMA on the high. No change in the pattern at all, just more low volume gyrating above the 50 day EMA and below the October low (849). Working in the range, trying to form up a new higher low here to make the next move and take out the 850 level.

SP600 (+2.14%) held its own as it too traded above the 50 day EMA while just below its own October closing low. As with SP500 it is trying to make a higher low shelf that it can break higher off of.

DJ30

The Dow was absent all session as it posted the smallest advance, just managing to hold the 10 day EMA on the low. No volume, no move, still below key levels at 8000 and basically needing the other indices to make the move. DJ30 was trying to lead and now it is not.

Stats: +47.55 points (+0.61%) to close at 7837.11

Volume: 255M shares Wednesday versus 276M shares Tuesday. Still no volume and that is okay as DJ30 is still in the testing mode.

DJ30 CHART: http://www.investmenthouse.com/ihmedia/DJ30.jpeg