ON THE MARKET - Alert > The VIX ticked 11.99 on Friday - watch it

Pre-market – Monday 11-18-2013

"The most important single central fact about a free market is that no exchange takes place unless both parties benefit."

~ Milton Friedman ~

Dr. John L. Faessel

ON THE MARKET

Commentary and Insights

Quotes of the day

"I know more about policies on any particular issue than my policy directors."

&

"I am absolutely certain that generations from now we will be able to look back and tell our children that this was the moment when we began to provide care for the sick and good jobs to the jobless; this was the moment when the rise of the oceans began to slow and our planet began to heal."

~ Barack Obama ~

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"I would simply ask—do you really want the same people who implemented Healthcare.gov (the Obamacare website) to run medicine in this country?" Mark Ling, M.D. Ph.D.

"If you like your plan" video montage

ALERT > The VIX ticked 11.99 on Friday - WATCH IT…

MARKET

The Dow Jones Industrials and S&P 500 (SPX) had their sixth straight week of price gains however it was another mostly dull week despite new highs for all three major indexes. Last week's volume was below average in the NYSE and slightly above average in the Nasdaq tho it was options expiration. "Price" in the S&P 500 (SPX) remains well above the resistance (now questionable support) of the top trendline of the channel that goes back to 2009. Overboughtness (McClellan) is in Neutral.

My Take

Major stock indexes remain extended and remain in strong uptrends and they keep adding points with hardly a hiccup albeit the gains have been relatively modest week over week. Bullish sentiment has eased over the last week although some indicators are flashing euphoric alerts. I continue to believe that discretion suggests that some $$ should be taken off the table as the market is priced to perfection. The debt ceiling is closing in and the Iran nuclear situation is smoldering on the front burner as they are very close to having nukes and I continue to believe that Israel, in concert with possibly the Saudi's, will act while the USA continues to have its head in the sand. The global debt behemoth, manipulation of interest rates, printing money and debasement of our currency continues unabated. EuroLand is slows with new rate cuts. Oh and the VIX premier gauge of fear ticked 11.99 on Friday. It's a la la land situation where major players seem to believe that we are in a new paradigm and debt means nothing – in effect saying; "let the good times roll – thank you – I'm fine and I'll have another bottle, err - make it two, of tequila." I'm dizzy just watching them getting bombed a la 1999.

Remember the prescient Volker quote;

In my ON THE MARKET report on 7-8-1999 I gave you the 'IT' quote:

"The fate of the world economy is now totally dependent on the growth of the US economy, which is dependant on the stock market, whose growth is dependent on about 50 stocks, half of which have NEVER REPORTED ANY EARNINGS." Said Paul Volker, former Chairman of the US Federal Reserve, who made that statement in the summer of 1999 when the Nasdaq was at 2500.Recall that in October 1998 the Nasdaq traded at 1357. In March 2000 it topped and traded at 5132.

Of Note re IRAN

Israeli Prime Minister Benjamin Netanyahu has called last week's offer to Iran, which incredibly had the support of USA's Secretary of State John Kerry, a "very, very bad deal."

S&P 500

The S&P 500 (SPX) closed Friday at 1798.18 - the prior Friday it was 1770.61

The 50-day moving average support is 1724

Short term 'Price' support is at 1791 / 1773 /

The a bit further out 1762 / 1746 / 1740 / 1716 / 1646 and 1627

The 200-day moving average support is at 1637

The top trend line of the channel that goes back 2009 to at (SPX) 1756 is now support ('that' previous resistance was breached on October 22nd.)

Channel and trend line support of (November 2012) is at 1702

Then deep channel and trend line support of (October 2011) is at 1595

Then the deepest channel and trend line support of (March 2009) is at 1389

* This Week's Investor Sentiment

The Bullishness / Bearishness complex overview has eased from recent post high Bullish readings.

(High BULLISH readings in the Investor Sentiment Readings usually are signs of Market tops; low ones, market bottoms.)

The Citigroup "Panic / Euphoria" Model remained in 'very high' neutral at a plus 0.42 registering a duplicate of last week's 0.42. These numbers are very near the Euphoria zone. In February 2013 it ticked into Euphoria at plus 0.49 and that posting was the highest since May 2008. At the end of June, 2011 it ticked cycle lows of minus0.31 in the Panic mode.

The American Association of Individual Investors [AAII]Investor Sentiment Survey of BULLISHNESS slid to 39.2% from 45.5% the prior week.

The "Bullish" survey posted recent highs of 52.3% 8-months ago. It posted cycle lows of 22.2% on 7/23/2012 the lowest percentile since August 2010. Long-Term Average: Bullish: 39.0%

The American Association of Individual Investors [AAII] Investor Survey of BEARISHNESS added a few percentile to 27.5% from last week's 21.8 -- 5- weeks ago it registered the lowest read since 1/12/2012 at 17.6%. Cycle highs of Bearishness of 54.5% were posted 14 weeks ago. Long-Term Average: Bearish: 30.5%

Consensus Index BULLISH was up to 72% from 68% last week's posting. New Cycle highs in Bullishness of 77% were posted 6-months ago matching the top tick of 77% on 10/11/2007.

The Market Vane (Market Letter Survey) posted a duplicate of last week's 65%. In October 2007 it topped at 70% bullish.

The BARRON's Confidence Index is 72.6 upa tick from 72.5 the prior week, one-year ago it was 66.6.

The Confidence Index is the premier measure of how the bond markets trillions (total global is around $93 trillion and USA is about 39% of that) are allocated: (The bond market is twice the size of the stock market.) The Index is the High-grade bond index divided by intermediate-grade index. A decline in latter vs. former - generally indicates rising confidence, pointing to higher stocks.

Friday's key indicators and metrics:

Cycle highs or lows are in red

·McClellan Oscillator is in Neutral at plus 39.7%

·3-month $ LIBOR hangs at new lows of 0.23810%

·CBOE Put / Call Volume Ratio – 0.75

·VIX – 12.19 - interday it ticked 11.99

·Swiss Franc – 1.0929

·US Dollar Index – 80.90

·Euro – 1.3490

·Japanese Yen – 0.9979

·Canadian Dollar – 0.9564

·Aussie Dollar –0.9343

·Crude oil (NYMEX) 93.84

·Brent crude 107.89

·Copper – 3.1710

·Gold (COMEX) – 1287.4

·Natural Gas (Globex) – 3.660

·The Treasury 5-year yield – 1.34%

·The Treasury 10-year yield – 2.70% - cycle high was on 9/10/2013 at 2.98%

·The 30-year Treasury – 3.80% - cycle high was on August 22nd at 3.93%

·Silver (COMEX) – 20.727

·Platinum 1438.9

·Palladium 732.65

·Lumber (CME) – 363.50

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