Buy and Sell Signals, and Other Market Perspectives Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Buy and Sell Signals, and Other Market Perspectives

SPY 665.67

-0.9%

4:00 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

Recommended by:

Machaon

To: Vitas who wrote (53277)	8/4/2013 1:34:12 PM
From: GROUND ZERO™	1 Recommendation of 218888

Investors, including institutional investors, are not committing to this rally... The Rydex Cash Flow Ratio gives an improved view of sentiment extremes by using cumulative cash flow (CCFL) into Rydex mutual funds rather than using the totals of assets in those funds (which we use for the Rydex Asset Ratio). It is calculated by dividing Money Market plus Bear Funds CCFL by Bull Funds plus Sector Funds CCFL. After reaching the bullish edge of the Ratio scale at the May market top, we can see how sentiment became quite bearish during the June correction. The July rally has taken the market to new, all-time highs, but, so far, investors have been holding back. Analyzing the data more closely, we can see that cash flow into bull and sector funds has not been enthusiastic, and bear fund cash flow shows that the bears have not yet capitulated. A note of encouragement is that the rally is not that old -- if it continues, positive cash flow could quickly catch up. Conclusion: The Rydex Cash Flow Ratio shows that investors abandoned the market during the June correction, more than the size of the correction ultimately warranted. Their reluctance to commit to the rally may be simply a case of not enough time for sentiment to change, and a reflection of how the "wall of worry" works. But in the end, money must be committed to the market to push prices higher, and so far, that isn't happening to any large degree. blogs.decisionpoint.com GZ

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next