Trend and Value

Nordstrom (JWN)

2009-11-12T04:38:00.000-06:00

after I hit the publish button on the Coach post, I thought I'd plug JWN into the chart maker. oddly, 37ish looks like an important price point here too.

COH (or, Don't Shoot the Messenger Bag Holder)

2009-11-12T04:22:00.000-06:00

shares of Coach Inc. (COH) hit another 52 week high yesterday. But $37 - give or take - has been a key level over the last several years. it seems reasonable to expect a tradeable correction soon, though one might view that big gap from a couple years ago as a more exuberant target.

with a forward P/E ratio in the 15s the company looks fairly valued if the prospects of a recovered economy are correct, and if the newly recovered consumer still hankers for the finer things in life. hey, if you stop paying your mortgage that nice handbag ain't so far out of reach anymore....

but it's like this: my sister got a J Crew catalog last week. she flipped through it for about 10 seconds and in mild disgust said, "what the heck is this? nobody's paying retail anymore!" so she tossed the catalog in the garbage.

now mind you, my sister and her husband are doing just fine financially, and can afford to buy pretty much whatever tickles the fancy, but that's just it; if folks like them who have the money won't pay the markups then who will?

nothing against Coach here, heck, they may fare better than some of the other names, I really don't know, but from what I can tell, the mindset, at least in the States, has moved away from the high end, high margin segment of the market. people will buy nice things if they see compelling value, but take a look at the sticker prices of stuff at the coach website. nice stuff, but not that nice.

Megaphone Pattern on GDX (Gold Miners ETF)?

2009-11-12T02:19:00.000-06:00

a perfect gift for cheerleaders this holiday season.

Volume on Major Indexes (S&P 500, &c...)

2009-11-12T01:54:00.000-06:00

turn up the volume Mister Bull.

Index Data

2009-11-12T00:20:00.001-06:00

closing values for Wednesday, November 11, 2009:

Trend & Value 50 Index:

1023.55 (up .47%)

Equity ETF Index:

1009.50 (up .67%)

China Small Cap ADR 25 Index:

957.93 (up 1.46%)

Large Cap Dividend Top 50 Index:

1015.13 (down .05%)

T&V Gold Stock Index:

600.19 (down .38%)

General Liquidity Index:

1020.27 (up .55%)

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on the ETF index XHB was the top gainer and EWZ the top loser. here's a ratio of the two:

what if US Homebuilders really started to take off while Brazil tanks? I refrain from any predictions on the matter, but gosh that would be funny. I can envision the headlines now:

America Recovers! . . . Third-World Still Poor

I'm more a broken record than a stoppped clock

2009-11-11T12:43:00.000-06:00

...and speaking of records!:

Salt'n Pepper - Push It (Video Music)
Uploaded by Grdgez. - See video of the biggest web video personalities.

(posted again by popular demand)

Non-Confirmations -- Industrials vs Transports, Gold vs Silver

2009-11-11T01:01:00.001-06:00

since my newsletter production has been rather sparse lately, I was about to send subscribers a quick email update, but then I figured I could just put it up on the blog instead...

plenty of indicators and whatnot at which to point to satisfy the preconceptions of bulls and bears and all the gradations between, but the non-confirmations on the two pairs below are the simplest and most important in my opinion.

even with Mr Buffett's vote of confidence, transports haven't hit a new high. then silver hasn't broken last month's high even though gold has been trading above last month's high for over a week now. so I'm remaining fairly skeptical of the inflation thesis, for now at least.

Slow News Day Special -- Motley Fool Hit-Piece on Ayn Rand

2009-11-10T23:33:00.001-06:00

this is just over the top:

The Daily Walk of Shame: Ayn Rand

let the lady rest in peace for gosh sakes. the Motley Fool, that great blob of mediocrity, cites the following as just a few of the examples of bad things we can pin on Miss Rand:

Remember the revelations from last year's Congressional hearings regarding Lehman Brothers CEO Dick Fuld? Apparently, when approached about conciliatory pay cuts to make up for poor performance, Fuld dismissed advocates of the idea by writing: "Don't worry -- they are only people who think about their own pockets." Pot, meet kettle.
Chesapeake Energy's (NYSE: CHK) Chairman and CEO Aubrey McClendon faced heat for his 2008 $112.5 million compensation package. That hefty paycheck made him the highest-paid CEO in the U.S., even though the stock fell 59%. Even worse, the company's board approved paying McClendon a huge bonus designed to help him buy back Chesapeake shares he lost in a margin call. It also OK'd paying McClendon $12.1 million for maps and artwork from his personal collection. Somewhere, Rand must be giving him a great big thumbs-up.
Many bailed-out bankers are doing pretty darn well, despite their companies' reliance on public funds to survive. Word of bonuses for AIG (NYSE: AIG), one of the poster children for the parade of companies that committed EPIC FAILS, stirred up outrage among many taxpayers. But hey, those executives worked hard at failing! No one could have failed quite like they did! They deserve that money!

say what you want about the tenets of Objectivism, but there's nothing in anything I've read by Rand that condones rewarding failure. in fact that is just the opposite of what she was getting at, if I'm not mistaken.

COT Extremes

2009-11-10T18:17:00.000-06:00

The Pragmatic Capitalist surveys all those big speculative net long positions in the Commitment of Traders reports:

SOMETHING BIG IS ABOUT TO HAPPEN?

here is the summary of just some commodities:

The largest speculative long positions are in the commodity space (this is near-term bearish) … 271,564 gold contracts (a record) on the Commodity Exchange (COMEX); 44,312 net longs on silver (near-record but not quite), West Texas Intermediate oil contracts on the New York Mercantile Exchange (also a record); 10,871 net long copper contracts (a new cycle high); 5,538 net speculative long contracts on the Goldman Sachs Commodity Index.

Index Data

2009-11-10T17:14:00.000-06:00

closing values for Tuesday, November 10, 2009:

Trend & Value 50 Index:

1018.73 (up .38%)

Equity ETF Index:

1002.75 (down .25%)

China Small Cap ADR 25 Index:

944.15 (up .87%)

Large Cap Dividend Top 50 Index:

1015.64 (up .15%)

T&V Gold Stock Index:

602.46 (up .2%)

General Liquidity Index:

1014.66 (down .37%)

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Death Cross Watch -- WEN Wendy's/Arby's Group Inc.

2009-11-09T22:39:00.003-06:00

27 S&P stocks on the death cross list now.

Index Data

2009-11-09T21:54:00.000-06:00

closing values for Monday, November 9, 2009:

Trend & Value 50 Index:

1014.89 (up 2.19%)

Equity ETF Index:

1005.26 (up 2.84%)

China Small Cap ADR 25 Index:

935.97 (down 1.50%)

Large Cap Dividend Top 50 Index:

1014.11 (up 2.02%)

T&V Gold Stock Index:

601.27 (up 1.64%)

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24% of T&V50 index and 30% of the ETF index components closed at new one year highs today. not bad. but how the hell did the China small cap index close lower on a day like this?

Index Data

2009-11-08T19:41:00.001-06:00

closing values for Friday, November 6, 2009:

Trend & Value 50 Index:

993.17 (up .18%)

Equity ETF Index:

977.5 (up .06%)

China Small Cap ADR 25 Index:

950.19 (up .97%)

Large Cap Dividend Top 50 Index:

994.05 (down .19%)

T&V Gold Stock Index:

591.56 (up .88%)

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MET was removed from the T&V50 and replaced with TRV, using Friday's closing price of 51.90.

Death Cross Watch -- Northern Trust (NTRS)

2009-11-07T02:04:00.003-06:00

that brings the total up to 26 now on the S&P.

Death Cross Watch -- DNR

2009-11-06T02:21:00.001-06:00

since the Golden Cross was such the celebrated signal in the Summer, I thought it would be fun to keep track of new Death Crosses this Winter. only one today from the S&P 500 list. DNR, Denbury Resources.

currently 25 S&P 500 stocks have a 50 dma below the 200 dma. here's the list:

AZO
BIIB
CAH
CEPH
DF
DNB
DNR
ERTS
FDO
FSLR
GENZ
GILD
HES
KEY
LMT
MCO
MON
NDAQ
PBCT
PCS
Q
S
STJ
VLO
WFR

also there are three on the T&V50 Index: MON, PPDI, WTR.

Panic Ratio year-to-date

2009-11-05T23:08:00.001-06:00

here is a chart of the VIX:IRX ratio from the beginning of 2009:

and here is an updating version of the same chart. (though you may need to be a stockcharts.com member to see it like the static image above. you should still get a default version. good to keep an eye on.)

update: and I'll add here an updating point and figure chart:

Index Data

2009-11-05T22:10:00.002-06:00

closing values for Thursday, November 5, 2009:

Trend & Value 50 Index:

991.36 (up 2.19%)

Equity ETF Index:

976.88 (up 1.88%)

China Small Cap ADR 25 Index:

941.02 (up 3.32%)

Large Cap Dividend Top 50 Index:

995.96 (up 1.22%)

T&V Gold Stock Index:

586.42 (up .06%)

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Index Data

2009-11-04T15:54:00.001-06:00

closing values for Wednesday, November 4, 2009:

Trend & Value 50 Index:

970.14 (up .22%)

Equity ETF Index:

958.87 (up .22%)

China Small Cap ADR 25 Index:

910.77 (up .26%)

Large Cap Dividend Top 50 Index:

983.99 (up .59%)

T&V Gold Stock Index:

586.05 (down .39%)

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the majority of issues closed lower than they opened today. like a swarm of black candles came over the market this afternoon. strength was found in an odd mix of defensive and beta. for example, the 7 symbols (out of 40) in the ETF index that closed higher than they opened were EWW, EWY, EWZ, XLK, XLP, XLU, XLV.

Index Data

2009-11-03T16:04:00.000-06:00

closing values for Tuesday, November 3, 2009:

Trend & Value 50 Index:

968.03 (up .08%)

Equity ETF Index:

956.79 (up .45%)

China Small Cap ADR 25 Index:

908.39 (up 3.15%)

Large Cap Dividend Top 50 Index:

978.23 (down .07%)

T&V Gold Stock Index:

588.33 (up 2.10%)

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quote of the day

2009-11-03T14:13:00.000-06:00

A great deal of time and intellectual force are lost in the world, because the false seems great and the truth so small and insignificant.

-- Maria Montessori

Index Data

2009-11-02T20:00:00.001-06:00

closing values for Monday, November 2, 2009:

Trend & Value 50 Index:

967.22 (up .66%)

Equity ETF Index:

952.51 (up .71%)

China Small Cap ADR 25 Index:

880.61 (up 1.33%)

Large Cap Dividend Top 50 Index:

978.92 (up .44%)

T&V Gold Stock Index:

576.25 (down .21%)

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CBOT Treasury Index relative to DJ Composite Total Return

2009-11-01T15:09:00.000-06:00

ten year chart:

89.8 Percent Bullish

2009-11-01T12:40:00.002-06:00

51 S&P 500 stocks are now trading below their 20, 50, and 200 day moving averages. see the list at the bottom of post.

when I first checked this stat back in September the number was 12. then about a month ago I checked up on it again and found the number was 39. since that post I started tracking the stat on a daily basis (though I missed one day). the lowest number was 11 on 10/15, while the highest reading so far has been 51 this last Friday.

the following chart of the S&P has the figures for each day.

the notable point of this indicator, if you can call it that, is that while the S&P is hardly changed since the first reading of 12 in September, the number of stocks that are bearish under this metric has increased over four fold.

so when I make little assertions like "the underlying structure of the market is deteriorating" this one of the things I have in mind. but there are plenty of other things to point to as well.

finally, when the indicator hit a low of 11 on 10/15, I made a portfolio of those 11 symbols to see whether they would underperform or outperform the broader market. an equally weighted basket of those 11 stocks is down 6.42% from 10/15, while the S&P 500 is down 5.5%.

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S&P 500 stocks trading below 20, 50 and 200 day moving averages on 10/30/09:

TSO
Q
AEE
LMT
LLL
PEG
GME
FLR
EXC
AZO
DRI
FPL
DF
AMGN
AYE
NTRS
BIIB
CMCSA
NDAQ
BCR
APOL
LOW
FSLR
GILD
PCS
MON
AOC
PPL
FAST
PWR
GENZ
STJ
IRM
QCOM
DNR
HES
NOVL
WFR
VLO
VMC
S
NUE
PHM
MBI
MI
KBH
KEY
EK
ERTS
BK
BSX

Australian Dollar -- AUD/USD weekly chart

2009-10-31T09:04:00.000-05:00

while I was emphatically bullish on the Australian Dollar for the majority of the past year, the trend's gone plenty far enough, in my opinion. I haven't got new targets completely worked up yet, but the chart below gives a preliminary sketch, at least against USD. I'll examine AUD more in depth soon enough.

Saturday morning trendline -- XME:XLP ratio

2009-10-31T07:45:00.001-05:00

of the components of the Equity ETF Index, XME was down the most this week, while XLP was down the least (all 40 symbols ended down on the week). so I figured I'd check out the ratio between the two extreme performers.

this ratio has been the epitome of the sell Defensive / buy Cheap Pieces of Shit trade that has been developing for about 11 months now. a violation of the trendline will signal that the revaluation turned reflation turned bubblet turned fortune cookies are the new world reserve currency turned 'waterloo' and the alamo too super duper bull market slash debutante ball has, ah, taken a different turn, I guess.