Guesstimates on July 31, 2012

September S&P E-mini Futures: Today's range estimate is 1380-93.  The ES is headed for the 1405-1420 range.  

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. The next significant move should bring yields up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market remains at 1.2760. The market looks like it is on its way to 1.1900. Draghis's promise to save the EU is long term bearish for the currency because it will require an expansion of euro liquidity relative to dollar liquidity.   

Dollar-Yen: This market is headed for 75 and lower.

September  Crude: The market has reached resistance at 93.  I think the next development will be a resumption of the bear market in crude. Next downside target is 66.

GLD – December Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - September Silver: A sustained move up is underway.

Google: Google held support near 562 and now is headed up to 750.

Apple: I think the market is headed above its 644 top and probably to 690-700.  Support stands at 560.

Guesstimates on July 30, 2012

September S&P E-mini Futures: Today's range estimate is 1372-85.  The ES is headed for the 1405-1420 range.  

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. The next significant move should bring yields up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market remains at 1.2760. The market looks like it is on its way to 1.1900. Draghis's promise to save the EU is long term bearish for the currency because it will require an expansion of euro liquidity relative to dollar liquidity.   

Dollar-Yen: This market is headed for 75 and lower.

September  Crude: The market has reached resistance at 93.  I think the next development will be a resumption of the bear market in crude. Next downside target is 66.

GLD – December Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - September Silver: A sustained move up is underway.

Google: Google held support near 562 and now is headed up to 750.

Apple: I think the market is headed above its 644 top and probably to 690-700.  Support stands at 560.

Guesstimates on July 27, 2012

September S&P E-mini Futures: Today's range estimate is 1356-70.  The ES is headed for the 1405-1420 range.  

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. The next significant move should bring yields up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market remains at 1.2760. The market looks like it is on its way to 1.1900. Draghis's promise to save the EU is long term bearish for the currency because it will require an expansion of euro liquidity relative to dollar liquidity.   

Dollar-Yen: This market is headed for 75 and lower.

September  Crude: The market has reached resistance at 93.  I think the next development will be a resumption of the bear market in crude. Next downside target is 66.

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - September Silver: A sustained move up is underway.

Google: Google held support near 562 and now is headed up to 750.

Apple: I think the market is headed above its 644 top and probably to 690-700.  Support stands at 560.

bearish market sentiment means higher prices ahead

Here is a pair of charts I think you will find interesting. The top chart is a daily bar chart of the cash S&P 500 going back to the May 2011 top. The bottom chart shows the five week (blue) and the 10 week (red) moving averages of bearish sentiment recorded by the AAII  weekly sentiment survey. The weekly number is obtained by dividing the bearish percentage by the sum of the bearish and bullish percentages (thus ignoring neutral market views).

You can see that the moving averages of this bearish percentage are at levels last seen at the 2010 and 2011 market low points. Yet as you can see in the top chart the S&P 500 is only about 4% below its March 2012 high near 1420. I think this means that the market is going to have to go a lot higher than it is now before bearish sentiment drops to levels last seen near the 2010 and 2011 tops.

On a purely mechanical basis the bull market in stocks is still on good footing. The market is visibly above its 200 day moving average (red line) which itself is rising. So excessive bearish sentiment in such a situation is doubly bullish.

For you Lindsay fans out there let me say that this is evidence that point 23 of the domed house still lies ahead of us. If a domed house really is developing the top should be somewhere in the 1450-1500 zone.

Guesstimates on July 26, 2012

September S&P E-mini Futures: Today's range estimate is 1344-60.  The ES is headed for the 1405-1420 range.  

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. The next significant move should bring yields up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market remains at 1.2760. The market looks like it is on its way to 1.1900. Draghis's promise to save the Euro this morning is long term bearish for the currency because it will require an expansion of euro liquidity relative to dollar liquidity.   

Dollar-Yen: This market is headed for 75 and lower.

September  Crude: The market has reached resistance at 93.  I think the next development will be a resumption of the bear market in crude. Next downside target is 66.

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - September Silver: A sustained move up is underway.

Google: Google held support near 562 and now is headed up to 750.

Apple: I think the market is headed above its 644 top and probably to 690-700.  Support stands at 560.

Guesstimates on July 25, 2012

September S&P E-mini Futures: Today's range estimate is 1334-50.  The ES is headed for the 1405-1420 range.  

QQQ:  A move to 76 is underway.

TNX (ten year note yield):  The 10 year yield is trading below  the low of its recent multi-month trading range. The next significant move should bring yields up to 3.00% and higher.   

Euro-US Dollar: Resistance above the market remains at 1.2760. The market looks like it is on its way to 1.1900.    

Dollar-Yen: This market is headed for 75 and lower.

September  Crude: The market has reached resistance at 93.  I think the next development will be a resumption of the bear market in crude. Next downside target is 66.

GLD – August Gold:   The market has dropped to the vicinity of the September and December low points at 1544 and 1529. I think a sustained up move is underway.  

SLV - September Silver: A sustained move up is underway.

Google: Google held support near 562 and now is headed up to 750.

Apple: I think the market is headed above its 644 top and probably to 690-700.  Support stands at 560.