Commentary--Lawrence McMillan for Thursday, September 14, 2000...
optionstrategist.com
Edited for ease of reading.
>>> Stock Market:
Mixed. That's the state of our indicators. Rarely do we see so many different opinions among our small set of indicators.
The equity-only put-call ratio gave a buy signal a couple of weeks ago and it remains bullish.
The weighted equity-only ratio is also on a buy signal, although by some interpretations one could say it's just moving sideways.
Finally, the breakdown of the equity-only numbers into its NYSE and NASD counterparts shows:
...a pretty clear buy signal for the NASD component,
...while the NYSE component is technically on a buy, too but one might again say that it's just drifting sideways.
Still, this group seems pretty bullish in its outlook.
The other broad market put-call ratios, however, don't agree.
All of the following are on sell signals:
...This includes the $OEX weighted,
...S&P 500 futures weighted and normal,
...NASDAQ- 100 ($NDX) weighted and normal.
...QQQ weighted is also on a sell signal, but we don't put much credence in the QQQ put-call ratio because of the heavy institutional hedging activity in those options.
Meanwhile, our oscillator's last signal was a sell signal back on August 18th. That remains in effect, since it was never stopped out. The oscillator itself stands in modestly overbought territory at +87. It would have to decline seriously in order to set up a buy signal.
Finally, the Volatility Index ($VIX) has apparently established a low, which not only triggered our straddle buy, but also indicates that more volatile times lie ahead.
In summary, signals are about as mixed as we've seen in some time, but prices are struggling, so maintain bearish positions while using tight risk control.<<< |
