Weekly commentary by Lawrence McMillan for Thursday, June 29, 2000
optionstrategist.com
>>>Stock Market indicators remain in about the same state as they were last week, although there are a few more bearish signs than there were. First of all, the broad market ratios are generally bullish. The equity-only put-call ratio remains on a buy signal, as does the WEIGHTED equity-only ratio. What is somewhat disconcerting is that both of these ratios have declined substantially from their May highs, yet the broad market has made only limited progress since then. However, for now, they remain bullish.
Things begin to get a little less rosy when one considers other broad market ratios. The breakdown into the NYSE and NASD equity-only ratios shows a rounding bottom on their put-call charts -- something that is very close to being a sell signal (or at least a cancellation of the last buy signal). In addition, the WEIGHTED $OEX put-call ratio is now on a sell.
NASDAQ indicators aren't any better. All of the following are right on the cusp of turning into sell signals, or have already done so: the NASD equity-only ratio, the NASDAQ-100 Index ($NDX), the QQQ ratio, and the WEIGHTED QQQ ratio.
Finally, market breadth -- which is measured by our oscillator -- has been struggling recently, although it has begun to pick up in the last couple of days. Our oscillator remains on a sell signal.
The larger perspective is that the market averages have not been able to follow through in either direction for quite some time. It was particularly disappointing to see $OEX fall back after exceeding the 800 level just last week. Since then, though, every rally has been met with some fairly heavy selling. The end-of-the-month adjustments seem to be window UNDRESSING, rather than window dressing. <<< |
