2-28-06  The S&P was down 13 to 1281. Yesterday's S&P close is probably a double top; that is, on 1/11/06 the S&P reached 1294.2, the previous market high for the last 4.5 years. Yesterday's close, at 1294.1, combined with today's decline, makes a second high value at the same level; that's what we call a double top. This is a bearish chart pattern, and in the future the S&P may possibly a decline to the 1245-1255 range, followed by a third top at 1294. Another possibility is a larger decline below 1245 from here.

The on-balance volume (OBV)(note 2) today was -1481 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from +86 to -160. We dropped a -249 from the average from six days ago, giving a positive bias to the 5DMA today. We will have negative bias to the 5DMA Wednesday due to dropping a positive number from the 5DMA from six days prior. We are now below the lower threshold for a buy signal, which could come anytime. No signals today. Please see Glossary  for any unfamiliar terms. The End of Month commentary will come on Friday this week.

Short-sellers paragraph: The steep decline today would have been nice to capture with our short sales, which we covered by rule yesterday. If the rule had been very slightly different, we would be in the shorts today, capturing the down day. The rule required that if the close yesterday were higher than the previous 1292.7 bogey (recent minor high on 2/22/06) plus one point, to 1293.7, we would be forced to close out the short position. If the rule had been 1.5 points, which is the number of S&P points for the RunLight signal, we would have avoided covering the short positions. So we are today changing the Busted rule to 1.5 points, rather than one S&P point. Please see Glossary  for any unfamiliar terms.

2-27-06  The S&P was up 5 to 1294. The up day in S&P was enough to bust out our short sales (see Short-sellers paragraph below).

The on-balance volume (OBV)(note 2) today was +324 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +37 to +86. We dropped a +77 from the average from six days ago, giving a slight negative bias to the 5DMA today. We will have positive bias to the 5DMA Tuesday due to dropping a negative number from the 5DMA from six days prior. The previous minor high (bogey) was violated today (see Short-sellers paragraph below). The bogey violation changes the Market State from OSCILLatory to Run-5, which changes the thresholds at which buy and sell signals are given. We did not get a buy signal since the 5DMA was not below -5.  Market State page has been changed for the Run-5. Please see Glossary  for any unfamiliar terms.

Short-sellers paragraph: The market up day blew out our short sales. The S&P needed to exceed the 1292.7 bogey (recent minor high on 2/22/06) plus one point to 1293.7 to force us to close out the short position. Since the S&P closed at 1294.1, we bought back the short positions in SPY and QQQQ for a small loss (see ETF page for meaning of these symbols). We dont record gains/losses from short sales in the Results_History. The Short-Sale State is re-affirmed as Dirty on the Market State Page (because of the loss on the short sale). Please see Glossary  for any unfamiliar terms.

2-24-06  The S&P was up 2 to 1289.

The on-balance volume (OBV)(note 2) today was +256 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from +247 to +37. We dropped a +1308 from the average from six days ago, giving a huge negative bias to the 5DMA today. We will have negative bias to the 5DMA Monday due to dropping a positive number from the 5DMA from six days prior.  Please see Glossary  for any unfamiliar terms.

Short-sellers paragraph: The market up day did not blow out our short sales. The S&P would have had to exceed the 1292.7 bogey (recent minor high on 2/22/06) plus one point to 1293.7 to force us to close out the short position. Please see Glossary  for any unfamiliar terms.

Long-Term Investors End of Week/End of Month update. The 200DMA (40 week moving average (40WMA)-Friday closes) of the S&P500 continues up and the S&P is above the 200DMA line, so we have a continuing BULL market. The Bull may be seen on Long-term Investor's page, Table 4, which is updated weekly. The entry in Table 4 for today's date shows an increase in the 40WMA over last week, and that the S&P500 close today is above that average. Table 2 of the Long-Term System page has been updated for the month of January, and that table shows an increase in the nine month moving average, and that the S&P is above that average line, indicating a BULL Market. In our BULL Bogey table below are the values above which the S&P must remain for a BULL Market to continue; they change week-by-week. These values may also be seen on Long-term Investor's page, Table 4, by counting back 41 weeks from date of interest. The S&P must also be above the 200DMA line, which it is today, signifying a BULL market. The BULL market will continue as long as the S&P remains above the BULL Bogey. The change in the Long-term System since the BULL market started on 11/4/05 is +5.67%, using S&P as the basis, or 5.54% using 50% of S&P and 50% of NASDAQ 100 as the basis. Please see Glossary for any unfamiliar terms

2-23-06  The S&P was down 5 to 1288. Short-term SELL signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was -589 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from +452 to +247. We dropped a +437 from the average from six days ago, giving a negative bias to the 5DMA today. We will have negative bias to the 5DMA Friday-Monday next due to dropping a positive number from the 5DMA from six days prior. The simultaneous decline in 5DMA and S&P, while the 5DMA was above the upper threshold of +19, gives a Short-term SELL signal. We sold the SPY, IWM and QQQQ that we bought on 2/6/06. The gain on this round trip was 1.8%, bringing our result for trades since the BULL market resumed 11/4/05 to -0.5%. The Market State page and the Results_History 04- have been updated for the SELL.  Please see Glossary  for any unfamiliar terms.

Short-sellers paragraph: Since the S&P was down more than 4 points and the State is Oscillatory, we may sell short. We sold with 50% of available funds for equities, equal amounts of SPY and QQQQ. The Short-sale State is Dirty from a sale in Nov 05, but we are chancing that the market memory back to November will be too weak to ruin this trade. Please see Glossary  for any unfamiliar terms.

2-22-06  The S&P was up by 10 to 1293.

The on-balance volume (OBV)(note 2) today was +689 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from +479 to +452. We dropped a +822 from the average from six days ago, giving a negative bias to the 5DMA today. We will have negative bias to the 5DMA Thursday-Monday next due to dropping a positive number from the 5DMA from six days prior. We are now above +400 in 5DMA, where we say the market is over-bought. The decline in 5DMA today, while it was above the upper threshold of +19, while the S&P did not decline, gives a Short-term ARM signal (first half of ARM&FIRE sell signal). Any decline in S&P tomorrow will complete the sell signal. Please see Glossary  for any unfamiliar terms.

2-21-06  The S&P was down by 4 to 1283.

The on-balance volume (OBV)(note 2) today was -249 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +442 to +479. We dropped a -436 from the average from six days ago, giving a positive bias to the 5DMA today. We will have negative bias to the 5DMA Wednesday-Monday next due to dropping a positive number from the 5DMA from six days prior. We are now above +400 in 5DMA, where we say the market is over-bought. No signals today; the rise in 5DMA prevented a sell signal. The Intermediate Down Trend (IDT) which we declared on 2/7/06, was violated last week (2/15). This does not constitute an Intermediate Up Trend; more correct chart behavior is required for that. Since the IDT is now False again, the Long-Purchase State becomes Clean, meaning we can buy with 100% of available funds for equities when we get a buy signal. The Market State page has been updated for the IDT change. Please see Glossary  for any unfamiliar terms.

2-17-06  The S&P was down by 2 to 1287.

The on-balance volume (OBV)(note 2) today was -77 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +404 to +442. We dropped a -109 from the average from six days ago, giving a positive bias to the 5DMA today. We will have positive bias to the 5DMA Monday due to dropping a negative number from the 5DMA from six days prior. We are now above +400 in 5DMA, where we say the market is over-bought. No signals today. Please see Glossary  for any unfamiliar terms.

Long-Term Investors End of Week/End of Month update. The 200DMA (40 week moving average (40WMA)-Friday closes) of the S&P500 continues up and the S&P is above the 200DMA line, so we have a continuing BULL market. The Bull may be seen on Long-term Investor's page, Table 4, which is updated weekly. The entry in Table 4 for today's date shows an increase in the 40WMA over last week, and that the S&P500 close today is above that average. Table 2 of the Long-Term System page has been updated for the month of January, and that table shows an increase in the nine month moving average, and that the S&P is above that average line, indicating a BULL Market. In our BULL Bogey table below are the values above which the S&P must remain for a BULL Market to continue; they change week-by-week. These values may also be seen on Long-term Investor's page, Table 4, by counting back 41 weeks from date of interest. The S&P must also be above the 200DMA line, which it is today, signifying a BULL market. The BULL market will continue as long as the S&P remains above the BULL Bogey. The change in the Long-term System since the BULL market started on 11/4/05 is +5.5%, using S&P as the basis, or 5.35% using 50% of S&P and 50% of NASDAQ 100 as the basis. Please see Glossary for any unfamiliar terms

2-16-06  The S&P was up again, by 9 to 1289.

The on-balance volume (OBV)(note 2) today was +1308 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +119 to +404. We dropped a -120 from the average from six days ago, giving a positive bias to the 5DMA today. We will have positive bias to the 5DMA Friday-Monday next due to dropping a negative number from the 5DMA from six days prior. We are now above +400 in 5DMA, where we say the market is over-bought. No signals today. Please see Glossary  for any unfamiliar terms.

2-15-06  The S&P was up again, by 4 to 1280.

The on-balance volume (OBV)(note 2) today was +437 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +139 to +119. We dropped a +537 from the average from six days ago, giving a negative bias to the 5DMA today. We will have positive bias to the 5DMA Thursday-Monday next due to dropping a negative number from the 5DMA from six days prior. No signals today. Please see Glossary  for any unfamiliar terms.

2-14-06  The S&P was up 13 to 1276.

The on-balance volume (OBV)(note 2) today was +822 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from -202 to +139. We dropped a -879 from the average from six days ago, giving a positive bias to the 5DMA today. We will have negative bias to the 5DMA Wednesday due to dropping a positive number from the 5DMA from six days prior. The simultaneous upturn in S&P and 5DMA, while the latter was below the lower threshold of -28, gives a Short-term BUY signal, but it is sterile since we are already fully invested. Please see Glossary  for any unfamiliar terms.

2-13-06  The S&P was down 4 to 1263.

The on-balance volume (OBV)(note 2) today was -436 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from -249 to -202. We dropped a -668 from the average from six days ago, giving a positive bias to the 5DMA today. We will have positive bias to the 5DMA Tuesday due to dropping a negative number from the 5DMA from six days prior. The upturn in 5DMA while it was below the lower threshold of -28, while the S&P did not turn up, gives an ARM signal (first half of an ARM& FIRE BUY signal), but it will be sterile since we are already fully invested. Please see Glossary  for any unfamiliar terms.

2-10-06  The S&P was up 3 to 1267.

The on-balance volume (OBV)(note 2) today was -109 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from -361 to -249. We dropped a -675 from the average from six days ago, giving a positive bias to the 5DMA today. We will have positive bias to the 5DMA Monday-Tuesday due to dropping a negative number from the 5DMA from six days prior. The upturn in S&P and 5DMA, while the 5DMA was below the lower threshold of -28, gives a BUY signal but it is sterile since we are already fully invested.   Please see Glossary  for any unfamiliar terms.

Long-Term Investors End of Week/End of Month update. The 200DMA (40 week moving average (40WMA)-Friday closes) of the S&P500 continues up and the S&P is above the 200DMA line, so we have a continuing BULL market. The Bull may be seen on Long-term Investor's page, Table 4, which is updated weekly. The entry in Table 4 for today's date shows an increase in the 40WMA over last week, and that the S&P500 close today is above that average. Table 2 of the Long-Term System page has been updated for the month of January, and that table shows an increase in the nine month moving average, and that the S&P is above that average line, indicating a BULL Market. In our BULL Bogey table below are the values above which the S&P must remain for a BULL Market to continue; they change week-by-week. These values may also be seen on Long-term Investor's page, Table 4, by counting back 41 weeks from date of interest. The S&P must also be above the 200DMA line, which it is today, signifying a BULL market. The BULL market will continue as long as the S&P remains above the BULL Bogey. The change in the Long-term System since the BULL market started on 11/4/05 is +3.8%, using S&P as the basis, or 4.05% using 50% of S&P and 50% of NASDAQ 100 as the basis. Please see Glossary for any unfamiliar terms.

2-9-06  The S&P was down 2 to 1264.

The on-balance volume (OBV)(note 2) today was -120 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from -536 to -361. We dropped a -998 from the average from six days ago, giving a positive bias to the 5DMA today. We will have positive bias to the 5DMA Friday-Tuesday next due to dropping a negative number from the 5DMA from six days prior. Yesterday's BUY signal (Sterile) was put into question today when the over-night volume figures showed that the 5DMA was unchanged, instead of the rise which gave the BUY signal. I have never seen an unchanged 5DMA on a day which gave a buy/sell signal. But there are no serious consequences since the BUY was Sterile anyway. Today's rise in 5DMA, while the 5DMA was below the lower threshold of -28, but with the S&P declining, gives an ARM (first half of ARM & FIRE BUY signal), but a buy signal will be sterile since we are already fully invested. Please see Glossary  for any unfamiliar terms.

2-8-06  In a nice advance, the S&P was up 11 to 1266. BUY signal (sterile) today (see next paragraph).

The on-balance volume (OBV)(note 2) today was +722 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV was unchanged at -536. We dropped a +538 from the average from six days ago, giving a negative bias to the 5DMA today. We will have positive bias to the 5DMA Thursday-Tuesday next due to dropping a negative number from the 5DMA from six days prior. Today's close completed a pattern that we call Intermediate-term Down Trend (IDT). IDT constitutes a pattern of falling minor highs and falling minor lows. The falling S&P highs were: 1/9/06, 1290.2 and 1/30/06, 1285.2. The falling lows are: 1/30/06, 1261.5 and 2/7/06, 1254.8. See yesterday's column for more IDT explanation.

The simultaneous upturn in S&P and 5DMA today, while the 5DMA was below the lower threshold of -28, gives a Short-term BUY signal, but it is sterile since we are already fully invested from the buy signal on 2/6/06. Please see Glossary  for any unfamiliar terms.

2-7-06  The S&P was down 10 to 1255. Intermediate Downtrend (IDT) signal today. And yesterday's BUY signal was negated after the close when the over-night volume figures came in (see next paragraph).

The on-balance volume (OBV)(note 2) today was -879 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from -412 to -536. We dropped a -257 from the average from six days ago, giving a positive bias to the 5DMA today. We will have negative bias to the 5DMA Wednesday due to dropping a positive number from the 5DMA from six days prior. Since we are below -400 on 5DMA, we say the market is over-sold. Today's close partially completed a pattern that we call Intermediate-term Down Trend. IDT constitutes a pattern of falling minor highs and falling minor lows. The falling S&P highs were: 1/9/06, 1290.2 and 1/30/06, 1285.2. The falling lows are: 1/30/06, 1261.5 and any low forthcoming  including today. If any of our readers have a time horizon measured in months rather than days or years, you would sell on today's IDT signal. Long-term investors will only sell when a BEAR market is declared. Short-term investors should check daily for buy and sell signals. The Market State page has been updated for the change in the BUY signal and the IDT, which is now True. The IDT means that the Long-Purchase State becomes Dirty, meaning we buy with only 50% of available funds on first buy signal, 25% on second, etc. There is nothing we can do at this point about the negated BUY signal wherein we bought yesterday with 100% of available funds except just hold onto the stocks we bought for the near term. Even though the bogey (minor low, which was 1264 on 2/3/06, after which we bought yesterday) was violated significantly, there are no actions we take to sell or change our positions. Please see Glossary  for any unfamiliar terms.

2-6-06  The S&P was up 1 to 1265. Short-term BUY signal today (see next paragraph).

The on-balance volume (OBV)(note 2) today was -675 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from -264 to -186 [fell after hours to -412, negating the BUY signal]. We dropped a +63 from the average from six days ago, giving a slight negative bias to the 5DMA today. We will have positive bias to the 5DMA Tuesday due to dropping a negative number from the 5DMA from six days prior. The simultaneous upturn in S&P and 5DMA, while the 5DMA was below the lower threshold of -28, gives a Short-term BUY signal. We bought, with 100% of available funds for equities, equal dollar amounts of SPY, QQQQ and IWM. Please see ETF page for meaning of these symbols. We are close to an Intermediate Down Trend (IDT). The last minor low was at 1261.5; if we get an S&P close that is 1 point below that, the IDT will come into effect. That will change the Long-Purchase State to Dirty and we will buy with only 50% of available funds on first buy signal. The Market State page has been updated for the BUY. Please see Glossary  for any unfamiliar terms.

2-3-06  The S&P was down 7 to 1264.

The on-balance volume (OBV)(note 2) today was -668 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from -75 to -328. We dropped a +596 from the average from six days ago, giving a negative bias to the 5DMA today. We will have negative bias to the 5DMA Monday due to dropping a positive number from the 5DMA from six days prior. We are now below the lower threshold of -28 in 5DMA for a Short-term BUY signal, which could come when both the S&P and 5DMA turn up. No signals today. Please see Glossary  for any unfamiliar terms.

Long-Term Investors End of Week/End of Month update. The 200DMA (40 week moving average (40WMA)-Friday closes) of the S&P500 continues up and the S&P is above the 200DMA line, so we have a continuing BULL market. The Bull may be seen on Long-term Investor's page, Table 4, which is updated weekly. The entry in Table 4 for today's date shows an increase in the 40WMA over last week, and that the S&P500 close today is above that average. Table 2 of the Long-Term System page has been updated for the month of January, and that table shows an increase in the nine month moving average, and that the S&P is above that average line, indicating a BULL Market. In our BULL Bogey table below are the values above which the S&P must remain for a BULL Market to continue; they change week-by-week. These values may also be seen on Long-term Investor's page, Table 4, by counting back 41 weeks from date of interest. The S&P must also be above the 200DMA line, which it is today, signifying a BULL market. The BULL market will continue as long as the S&P remains above the BULL Bogey. The change in the Long-term System since the BULL market started on 11/4/05 is +3.6%, using S&P as the basis, or 3.9% using 50% of S&P and 50% of NASDAQ 100 as the basis. Please see Glossary for any unfamiliar terms.

2-2-06  The S&P took a hit today, down 12 to 1271. I hope all our short-term oriented readers unloaded their stock on our Short-term SELL signal (1/31/06).

The on-balance volume (OBV)(note 2) today was -1317 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV fell from +347 to -75. We dropped a +796 from the average from six days ago, giving a negative bias to the 5DMA today. We will have negative bias to the 5DMA Friday-Monday next due to dropping a positive number from the 5DMA from six days prior. We are now below the lower threshold of -28 in 5DMA for a Short-term BUY signal, which could come when both the S&P and 5DMA turn up. No signals today. Please see Glossary  for any unfamiliar terms.

2-1-06  The S&P was up 2 to 1282.

The on-balance volume (OBV)(note 2) today was +538 (million shares). The 5 day moving average (5DMA)(note 1) of the OBV rose from +205 to +347. We dropped a -174 from the average from six days ago, giving a positive bias to the 5DMA today. We will have negative bias to the 5DMA Thursday-Monday next due to dropping a positive number from the 5DMA from six days prior. No signals today. Please see Glossary  for any unfamiliar terms.