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The Dow Industrial Average is the only major average above its 200-day simple moving average at 11,941. The major averages that did not reach their 200-day SMAs for the Santa Claus rally are: 2661 NASDAQ, 763.01 Russell 2000 and 390.93 SOX. The NASDAQ 100 (NDX) was above its 200-day at 2288, but closed below it on Wednesday. The S&P 500 did the same with its 200-day at 1258.9. Dow Transports closed just below its 200-day at 4977. The Santa Claus rally thus appears to be over, or has just limited additional upside. The yield on the 10-Year US Treasury is back below its 50-day SMA at 2.031. Gold is now trending below its 200-day SMA at $1621.7. Crude oil failed to stay between my annual pivots at $99.91 and $101.92. The euro remains oversold and below its 50-day simple moving average at 1.3462.

10-Year Note – (1.914) Semiannual, quarterly and annual value levels are 2.414, 2.669 and 2.690 with the 50-day simple moving average at 2.031, a daily pivot at 1.957, a weekly risky level at 1.700, and semiannual and monthly risky levels at 1.672 and 1.602.

Courtesy of Thomson / Reuters

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Comex Gold – ($1554.7) Semiannual and annual value levels are $1469.9 and $1,356.5 with the 200-day at $1621.7, daily, weekly and semiannual pivots at $1618.3, $1639.5 and $1644.8, and quarterly and monthly risky levels at $1738.4 and $1873.8, and the September 6th all time high at $1923.7. The year’s low was $1535.0 set on September 26th.

Courtesy of Thomson / Reuters

Nymex Crude Oil ($99.54) The October 4th year-to-date low is $74.95 with a monthly value level at $86.20, the 50-day and 200-day simple moving averages at $96.32 and $95.76, quarterly and annual pivots at $100.34, $99.91 and $101.92, and daily, weekly and semiannual risky levels at $102.85, $102.49, $103.93 and $107.90. The high and low for oil happened on the same days as the Dow with the high at $114.83 per barrel on May 2nd.


Courtesy of Thomson / Reuters

The Euro – (1.2933) Quarterly and weekly value levels are 1.2598 and 1.2545 with a daily pivot at 1.3028, the 50-day simple moving average at 1.3462, and monthly and semiannual risky levels at 1.3953, 1.4752 and 1.4872.

Courtesy of Thomson / Reuters

Daily Dow: (12,151) The 200-day simple moving average is 11,941 with the 50-day at 11,907. Monthly, weekly, annual, and semiannual value levels are 11,794, 11,730, 11,491, 9,635 and 8,468 with daily, quarterly and annual risky levels at 12,330, 12,507 and 13,890. The October 4th low was 10,404.49 with the May 2nd high at 12,876.00.

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Courtesy of Thomson / Reuters

S&P 500 (1249.6) The October 4th YTD low is 1074.77 with monthly, annual and weekly value levels at 1211.8, 1210.7 and 1190.7, semiannual value levels at 981.3 and 855.7, and daily, quarterly and annual risky levels at 1271.7, 1303.7 and 1562.9. The YTD high is 1370.58.

NASDAQ (2590) The October 4th YTD low is 2298.89 with monthly, weekly and annual value levels at 2588, 2473 and 2335, semiannual value levels at 2199 and 2049, and daily, quarterly risky levels at 2633 and 2807, and the YTD high at 2887.75. My annual risky level is 3243.

NASDAQ 100 (NDX) (2267) The YTD low is 2034.92 with a weekly value level at 2166, a monthly pivot at 2282, semiannual value levels at 1951 and 1861, daily and quarterly risky levels at 2299 and 2440, the YTD high at 2437.42, and my annual risky level at 2590.

Dow Transports (4974) The October 4th YTD low is 3950.66 with weekly, monthly and semiannual value levels at 4806, 4752, 4335 and 3868, and daily, annual and quarterly risky levels at 5107, 5179 and 5359, and the YTD high / all time high at 5627.85 set on July 7th.

Russell 2000 (735.22) The October 4th YTD low is 601.71 with weekly and monthly value levels at 700.13 and 695.30, semiannual value levels at 577.47 and 530.04, and daily, annual and quarterly risky levels at 756.16, 784.16 and 802.96, and the YTD high / all time high at 868.57 set on May 2nd.

The SOX – (362.59) The October 4th YTD low is 322.24 with weekly and monthly value levels at 345.61 and 346.01, an annual value level at 270.98, and daily, quarterly risky levels at 369.53 and 417.63, and the YTD high at 450.79.

Equity Fundamentals – Stocks remain fundamentally cheap.

  • 75.1% of all stocks are undervalued / 24.9% of all stocks are overvalued. On October 4th - 93.5% of all stocks were undervalued.

  • Eight sectors are undervalued and eight sectors are overvalued in a range from 16.5% undervalued to 10.0% overvalued. Back in March 2009 the sectors were undervalued by 33% to 45%.

Source: Major Averages Straddle 200-Day Simple Moving Averages