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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA
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To: J.T. who wrote (8036)7/4/2001 12:11:51 AM
From: James F. Hopkins   of 19219
 
JT; A word you used "ratio" caused me to look at another angle
at least with the ( Dynamic Series (200% correlation to Index))
---------
And putting aside how the short term traders often get
snookered , I looked at total "shares" of both bull funds Titan and Velocity..
then both bear funds Temptest & Venture.
(Shares being TA / NAV)

It's normal for the Bull funds to have more Shares..and Money invested.
in them , taking the ( total bull / total bear ) it gave a ratio that ran
from a (2.65 Low on June 8th) to yesterdays high of 7.18 !!

However being these type funds use futures they can sure as heck
move the market this is a twist on just looking at them
separately
In the short time frame I have , so far a 4.03 ratio is average.
( if I take out that unusual high on the 2nd )
The point is when the ratio has gone much above 4 to 1 the market did
move up , when it dropped down in the 3 to 1 level the market pulled
back. It's causing me to think the ratio of the amount of money in these
type of leveraged funds can indeed move the market.
------------
I don't know that a fixed ratio would be good to trade off,
however a meaningful change in the ratio could be a
usable signal. I don't want to say right now as I don't have data
that takes in such a high bull ratio as we had yesterday
( it pulled back to 5.7 today ) still 5.7 looks like a sort
of high AVERAGE to bet against. However from a 7.18 that's a lot
of futures sold.
This is a wait and see thing for me, I stayed boxed.
I will look at ratios of the non leveraged SPX and OTC funds next.
Thanx for the timely update of the TAs.
Jim
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