CorporateInsiders
|
|
|
|
|
|
|
CorporateInsiders |
|
|
 |
This page contains analysis by Insider Insights, and does not necessarily represent the views of Sundial Capital Research. The weekly viewpoints and charts from Insider Insights are presented to subscribers of sentimenTrader as an aide in your attempt to determine current levels of investor sentiment. Insider purchases and sales take a unique skill set (and a good amount of experience) to evaluate correctly, which is why we have decided to partner with the experts at Insider Insights. Please go to www.insiderinsights.com to view more of their unique and value-added research.
July 18, 2008 The market surged over the past week, but it is still debatable whether any leg up can be sustained. Even with the help of federal agencies, the current spike still looks more like a bear-market rally when longer-term charts of the indices are examined. The bullish downward inflection in the Rolling 4-Week Average of my Weekly Buy/Sell Ratios (see yellow oval on Chart below) stalled noticeably weeks ago. This metric has now started to inflect bearishly upwards again, and I was forced to add a red Sell Signal bar to the Chart just last week. We’ll see if I get whipsawed out of that call. Prior to 2003, substantial market bottoms tended to correspond with this Indicator inflecting downward after rising to at least positive 40% (see Longer-Term Chart at bottom). If that threshold is hit again, it will likely be the result of a large swoon in the market. With the numerous economic imbalances built up over the years reversing course now, such a swoon seems more possible than ever. So I remain wary that this market, and future government intervention, could be overwhelmed by bearish economic realities, and have raised the cash level on my Recommended List to 33%. That said, full-blown market crashes are rare, and it is usually alarmist and unprofitable to position yourself for one. The market’s sudden surge over the past two days is testimony to that sentiment. But it is clear that bottom-feeding on the immense volume of values insiders are indicating is a safe bet only if you have at least a one-year investment horizon. Sentiment remains generally poor in the near-term, and a bearish outlook is also logically supported by the present news flow. Patience with further bottom-feeding, and selling into this present surge is still my inclination as of this writing. CLICK CHART FOR LARGER VIEW
A Buy/Sell Ratio of negative 25% means that there were 25% more companies with insiders selling shares in the open-market versus purchasing them during the time period indicated. A positive Buy/Sell Ratio indicates that there were that percentage more companies with purchasers than sellers. Historically, this methodology has indicated bullishness when the Ratios climb above positive 20%, and bearishness when they fall below negative 20%. Readings have been well below negative 20% for quite a while now.
© 2001-2008 Sundial Capital Research, Inc. All rights reserved. sentimenTrader.com is a trademark of Sundial Capital Research, Inc. Sundial Capital Research, Inc. 12527 Central Avenue NE, Suite 165 Blaine, MN 55434 |
|
|
 |
|
|
