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The Anals of Stock ProctologyPublished 5 times
per week by the American Academy of Stock Proctology and Available by annual subscription for $1929. (Just kidding, details to follow.) Warning - If you are not an experienced, independent, investor/trader, capable of forming your own opinions, and making your own decisions, PLEASE LEAVE THIS WEBSITE NOW! Like all poodits, Dr. Stepan N. Stool, the stock proctologist, takes no responsibility for anything, especially if you happen to agree with him when he's wrong! Please See Disclaimer Welcome to the The Anals of Stock Proctology, the new scholarly journal of the American Academy of Stock Proctology, edited by the world famous founder of the study of Stock Proctology, Dr. Stepan N. Stool PHandD. The Anals replaces Capitalstool's nightly and weekend updates of the major stock indexes. Now you can get your nightly stock proctology report in one convenient, uncluttered page, right here. The Anals will be available for free, for the immediate future. Some time between now and March 15, however, all advertising and solicitation will be removed from the Anals, and access to the Anals will be restricted to subscribers. As a result of the clean format, the Anals will be readily printable for reading in locations more appropriate to such endeavors, such as, uh, the kitchen table. Yes. The remainder of the site, including The Stool Pigeons Wire, IntradayStool, Stoolhoo, and Stoolchat, will continue to be free. You will never have to pay for access to these pages. Previous contributors to Capitalstool will receive a free subscription period. Prior to going to a subscription format, the voluntary pay buttons will remain. So feel free to contribute now. Your contribution will result in a full credit toward your future subscription. Several of you have already contributed in excess of $500, and you will receive a free lifetime subscription. Contributors of written content or illustrations used on the Capitalstool front page will also receive free subscriptions. That includes all who achieve the level of Professor of Stock Proctology on the Stool Pigeons Wire. Initial subscription rates will be $19.29 for a 3 month trial and $74 per year thereafter, in honor of the great bear markets of the 20th century. As always I thank you for your support, and I look forward to many prosperous years working together with you. Dr. Stepan N. Stool February 19, 2002
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SPX Charts The VIX, a sentiment indicator based on options volatility, closed at 22.03, up slightly from Tuesday. A point I've made many times is that it's impossible to judge what is oversolde in a bear market. By the same token, it's impossible to know what is extreme in a bubble. If this is a new bubble, then th readings we are seeing are not extreme. We can only know when they are after they have turned. While these are certainly not levels from which major upturns are launched these are not normal times. The SPX has apparently broken through major resistance. But stoolies know that market managers always do that as a means of sucking in the last chartist's dollar before reversing. The next two days are critical. If prices can hold above the downtrend line, the bubble is back, alive and well, but if they fall back below that line by the close Friday, then this was simply a hellacious rally that will exhaust demand for months to come and lead to new lows within weeks. The problem is that momentum indicators show gathering strength that is almost certain to push prices higher. Bears are left with only the tiniest shred of hope. That is for an immediate and sever reversal. |
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This 10-13 week cycle is heading higher. It is 4 weeks along. It broke the upper bands of descending long term channels. While this is what happened during upside blowoffs, the 6 month cycle indicator suggests that this is only the beginning of of a 6 month up phase. The short cycle oscillator, which mimics the 6-7 week cycle, has reached a level consistent with a short term high, and the time for a cycle peak is due, but that's not enough to keep the bear case alive. If the gains are consolidated, rather than immediately reversed, the only cycle fit would be a rising long term cycle channel as shown on the chart. The 10-13 week cycle high is due at any time over the next 2 weeks. The centered moving average projection for that cycle is now 1160. That was nearly reached. For the bear case to remain alive the rally needs to be reversed probably no later than Thursday.
This chart shows there's actually another major resistance area that has not been penetrated. The long term downtrend is moderating. If the gains hold here the downtrend is broken. The point I've made since Monday is that the market must reverse most of the gains by the end of the week or further gains over the next several months are a near certainty.
The Cycle Conditions tables include cycle phase and a wild guess as to number of periods to the next turn, in days for the shortest cycles, weeks (W) or months (M) for the longer ones. This is a fluid exercise, in other words, the projections are likely to be wrong, but they force us to be vigilant for key turning points, and frequently work well enough to prevent costly misreadings of the market. SPX Cycle Conditions as of 3/6/02
PTT - Periods Till Turn Nasdaq Charts The six month cycle oscillator has turned up. Will the up phase head sideways or up? Short term cycles are near a high. If the short term down phase is not down in real terms, they could blow this sky high. But Doc thinks that when the short squeeze has exhausted itself, it will fall apart.
A linear regression channel projected over the last couple of cycles suggests that the Nas could move toward 1925-50 before it would be overbought.
The Nas Fiber Nacho regurgitation chart shows that 1900 would be a 50% retracement. The next level is 1950.
Nasdaq Cycle Conditions as of 3/6/02
PTT
- Periods Till Turn Bork Attack! Today's featured borking is JPMooganChokes, by borker DoucheBag Alex Brown. As we all know, the act of borking is what happens when a borkerage firm analcyst pumps a stock the borkerage's trading department is trying to get rid of. Invariably, the stock is borked at the high, or the borking itself causes the stock to top out. It doesn't make much difference, the result is always the same. You get screwed, or borked, because the guy managing your retriement finds is eiother too stupid to know better, of he does and doesn't give a crap, because, after all, it ain't his money!
Golden Stool The gold stocks remain in consolidation, preparing for the next move up in preparation for the coming hyperinflation. There is some risk that the end stage of the short term down phase will get a selloff down into the high 70s. Or they could begin to move higher from here.
Long Bong Hit The 6-7 and 10-13 week cycles in bond yields are turning up. The 6 month cycle has been in a down phase for three months. That resulted in a trading range and it is ending. Bond yields may be ready to stage a powerful move up which could send 10 year Treasury yields rocketing above 5.5%. But watch the 28 day rate of change closely. If that turns down bond yields will head down. But if it does not turn down, investors will continue to rotate out of bonds and into stocks.
Dollar Death Watch Yesterday I said, "The dollar has topped out. How do you say Smoot Hawley?" I'll add the question, how do you reconcile a strong stock market with a weak dollar and weak bonds?
See you in Intraday Stool. Let us know what you think on the Stool Pigeons Wire. Archive |
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