Checking in on news and reviews about the markets this weekend

Here's a roundup of some work by others on the "Inter-Web" (funny new term) that my readers will appreciate. We'll start with two standard favorites whose sites are always included in the other sites listed at right here), then reference others:

Terry Laundry's T Theory siteis where he updates each weekend - Right now it's showing:

Update for Sunday August 23 2009 Today's Topics include; T Theory Tutorial coming this week, a look at the Volume Oscillator S&P chart vs the Advance-Decline Line S&P chart and their relationship, the volume oscillator Mystery T, the need to understand the volume oscillator wave pattern in detail, and my response to most all of the questions received last week. Look over the two daily PDF charts then listen to my long Audio Commentary.
S&PvsVolOsc TDownload SRvoT20090823
S&PvsA-D line Download SRadT20090821

Next update coming on Sunday by late afternoon
------------------------------------------------------------------------------
Quick update for August 18 2009- The reaction should be finding a bottom here or over the next few days. Watch for turning pattern in the oscillator or the market. Market should see new highs by early Sept.

Schaeffer's Research - Monday Morning Outlook: Market Indexes at Highest Levels of 2009. As they say in their intro: "Looking ahead to next week, Todd Salamone, Senior Vice President of Research, examines key resistance and support levels for the S&P 500 Index (SPX), the Nasdaq Composite (COMP), and the Russell 2000 Index (RUT), as well as some key sentiment indicators and their potential impact on the current market environment. Then, Senior Quantitative Analyst Rocky White looks at the 50-day buy-to-open put/call volume ratio on the SPX, and the potential implications of the ratio's recent dip. We wrap up with a look at some key economic and earnings reports slated for release this week." Todd's good analytic commentary then notes that, despite the rally, pessimism lingers which means there's still fuel to push higher and we don't have everyone fully invested yet. For example, he states:

With a mild pullback occurring, and sentiment clearly becoming more negative, the bulls may be getting exactly what the doctor ordered. I'd imagine that sentiment will turn more positive, especially after last week's rally, but optimism may not have reached the extremes that existed prior to the pullback. A short-term target objective for the SPX is 1,065, which is home to its 80-week moving average. This trendline has been extremely important in terms of support and resistance since April 2005. Support, meanwhile, should lie in the 1,000 area, as those waiting on the sidelines for a pullback to 950 may likely step in at this point.

Todd also looks at Fibonacci levels. You'll also want to click on the article's page 2 for Rocky's analysis of put-call ratios. I don't want to give away his conclusions, but trust me, it's interesting. As background, here's his explanation of the analytic method:

Foreword: One indicator that we look at frequently and consider very important is the buy-to-open (BTO) put/call volume ratio on S&P 500 Index (SPX) options. We like this indicator because it specifically looks at buy-to-open volume, filtering out volume generated by premium sellers or traders closing existing contracts. However, we do not interpret this ratio in the traditional sense; that is, we do not infer that puts are bearish bets on the market and calls are bullish bets. Rather, we know that these options are very popular hedging vehicles. Institutional investors buy SPX put options as hedges for increases in their portfolios, which leads to an increase in the put/call volume ratio. As they sell stocks to decrease their portfolios, they have less need to buy puts as a hedge. Therefore, we interpret an increasing BTO put/call ratio as a signal that big money is flowing into the market. A decreasing ratio, meanwhile, tells us institutional investors are selling stocks to trim their portfolios.

So, check out his graphic analysis of what that's showing.

Be sure to browse the other sites listed at right, including Andy Askey's fascinating Gann analysis at his PTV-Investing blog, and Bill Luby's VIX and More blog. (VIX not making new lows here (yet, anyway!), and I posted a version of Bill's favorite, a VIX:VXV ratio chart, at my UBTNB3 blog last night).
UPDATE - Andy Askey posted West Texas Crude At Decision Point (8/21/09) providing a very interesting Gann analysis of oil and also pnme for natural gas.

Marty Chenard article at Safe Haven (8/22/09): "Something big is around the corner ... a large move in the interest rates. At least, that is what the 10 year yield chart is telling us now.

"Take a moment to look at the (TNX) 10 year yield chart. A very large triangular formation has occurred. It started in May and it is now working its way to its apex where a breakout will occur.

"From a technical projection standpoint, a 9 point move should occur from the breakout point ... up or down. That is a very large move and it will have an impact on housing, automobiles, and anything requiring a loan. And yes ... it will also have an impact on the stock market.

"The question is whether the breakout will be up or down?"

Interview featuring Louise Yamada, at: Financial Sense Newshour, with Jim Puplava, (8/2//09).

VALUE LINE HASN’T BEEN THIS BEARISH SINCE 2000 THE PRAGMATIC CAPITALIST (8/22/09)(sorry for the all caps, it's how PragCap does it)

Jesse's Café Américain: Why the Austrian, Keynesian, Marxist, Monetarist, and Neo-Liberal Economists Are All Wrong, (8/20/09).

PIMCO - July 2009 Global Central Bank Focus; McCulley:

"America is in a liquidity trap, driven by private sector deleveraging borne of asset price deflation, meaning that private sector demand for credit is axiomatically flat to negative, despite a Fed funds rate pinned against zero. The only source of credit demand growth in the United States is the Treasury itself.

"And until the deleveraging process runs its course, consensus agrees that there is nothing wrong with such bloated Treasury demand for credit: In a recessionary foxhole, Keynesian religion dominates all other economic religions. But not all believers are equally devout, as noted at the outset, with many against any further ramping up of Keynesian stimulus, at least without a contemporaneous move to ensure long-term fiscal responsibility, so as to prevent a deleterious increase in long-term Treasury interest rates."

Finally I just want to post my daily and weekly chart of the BKX banking index. Time and space aren't sufficient for anything but the quick observation that the banks were late to sizzle and could be soon to fizzle. They're running into more resistance, while the weekly shows overbought/cycle cresting, and the daily shows negative divergence: