Chart of the Day

The CNN Fear & Greed Index has surged to the 75 level which means the market is in extreme greed mode. While the Index can stay pinned at excessive levels (both during periods of extreme fear and extreme greed) speculators are heavily leaning in one direction right now. Time for hedges… To learn more about…

A “sell” signal has been issued by SentimenTrader named after the Titanic. Based on the name alone, one can imagine what the results might be… SentimenTrader states, “While lesser known, the Titanic Syndrome for the Nasdaq exchange has been triggered several days over the past week. Bill Omaha created the Titanic Syndrome in the 1960s….

The total yield of the Nasdaq 100 (blue line) has collapsed, while 2-year (orange line) and 6-Month (grey line) government rates have surged. As a result, the average stock in the Nasdaq 100 is looking incredibly expensive. (Our measure of the Nasdaq 100 yield is the sum of EBIT over the past 12 months plus…

Margin debt remains at elevated levels. Typically bear markets end with margin balances reverting to a positive balance. We are nowhere near positive balance levels. Meanwhile, the rate to carry current margin balances is increasing significantly as well. It’s time to add to hedges. To learn more about how these indicators can help manage risk…

In recent weeks, we have warned that market breadth has deteriorated. Poor breadth in the midst of a rising market is a red flag as fewer stocks are participating in the market rally. Dovetailing with the narrowing market breadth is the share of the biggest stocks in market-cap weighted in indexes. The chart below shows…