Gary, I do not have the numbers before me, but I think that total margin debt has increased to "pretty close" to last early March. On July 16th (two weeks ago) I posted:
Message 14054163
I thus started redeploying cash when we got to within 100 Naz points of my target. When that failed late last week, I "ruthlessly" sold and increased position to max cash. I think that I should have paid more attention to the paling turnips, but like many, I was fooled by the Naz printing a new recovery high. There is of course no way I can determine how far this decline will go, but despite the very negative tic Friday, the equity put/cal ratio was still reflecting lack of fear. Maybe we do not need fear to reverse, but my bet, viewing what is happening in Asia lately, the lack of follow through response of good stocks to stellar earnings (SSTI, SNDK, KEM and CYMI as just few examples) indicates to me that the rally to 4200 was highly distributive. Even Friday's action starting in marking up stocks in the premarket just to take these down ruthlessly later in the day is highly indicative of further weakness ahead. The best scenario would be another two sharply down day getting us to the 3385 to 3415 range on the Naz with very negative ticks, and holding there (or at least a small bounce), but if we are anemic and we see no intraday major tic reversal, I would guess that the turnips' palor was justified and we could make a marginally lower low on the Naz before Summers and the troops come to the rescue.
Zeev |
