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Weak Economic Data and Negative Charts Trump Debt Deal.

|Includes: DIA, GLD, iShares 20+ Year Treasury Bond ETF (TLT)
August 2, 2011 – Weak Economic Data and Negative Charts Trump Debt Deal.
 
MY FEARLESS PREDICTION OF THE WEEK WAS - A weaker than expected economy and technical damage to the charts for the major equity averages sets the stage for a second half test of my annual value for the Dow Industrial Average at 11,491. We need a weekly close above the five-week modified moving average at 12,377 to delay this downside risk. A break of the up trend at that goes back to March 2009 at 12,096 should accelerate the downside.
 
10-Year Note – (2.746) Many Wall Street economists and strategists have told investors to avoid US Treasuries. My annual risky level at 2.690 was tested overnight with a new year to date low at 2.684. Daily and weekly value levels are 2.870 and 2.886 with the annual risky level at 2.690 and semiannual risky level at 2.414.
 
Courtesy of Thomson / Reuters
 
Comex Gold – ($1619.5) My monthly and weekly value levels are $1604.1 and $1580.3 with a daily pivot at $1626.5, and semiannual and quarterly risky levels at $1644.8 and $1655.8.
 
Courtesy of Thomson / Reuters
 
Nymex Crude Oil ($95.96) My weekly value level is $91.41 with the 200-day simple moving average at $94.96, and daily and annual pivots at $97.11, $99.91 and $101.92 and quarterly and semiannual risky levels at $102.40 and $103.92. Oil is below its 200-day this morning.
 
 
Courtesy of Thomson / Reuters
 
The Euro – (1.4259) My weekly and quarterly value levels are 1.3997 and 1.3728 with daily and semiannual risky levels at 1.4489 and 1.4752.
 
Courtesy of Thomson / Reuters
 
Daily Dow: (12,132) The 200-day simple moving average is 11,983 with the 50-day at 12,310. My annual value level is 11,491 with daily, weekly, monthly, quarterly and annual risky levels at 12,195, 12,422, 13,460, 13,839 and 13,890.
 
Courtesy of Thomson / Reuters
 
S&P 500 (1286.9) The 200-day SMA is 1285.4 with the 50-day at 1307.9. Annual and semiannual value levels are 1210.7, 981.3 and 855.7 with daily, weekly, monthly, quarterly and annual risky levels at 1303.0, 1308.8, 1444.1, 1467.0 and 1562.9.
 
NASDAQ (2745) The 200-day SMA is 2707 with the 50-day at 2751. Annual and semiannual value levels are 2335, 2199 and 2049 with daily, weekly, monthly, quarterly and annual risky levels at 2775, 2767, 3038, 3109 and 3243.
 
NASDAQ 100 (NDX) (2354) The 200-day SMA is 2282 with the 50-day at 2317. Semiannual and annual value levels are 1951, 1861 and 1723 with a weekly pivot at 2354, and daily, monthly, annual and quarterly risky levels at 2389, 2553, 2590 and 2630.
 
Dow Transports (5131) The 200-day SMA is 5162 with the 50-day at 5311. Semiannual value levels are 4335 and 3868 with an annual pivot at 5179, and daily, weekly, monthly, quarterly and annual risky levels at 5205, 5373, 5654, 6112 and 6131.
 
Russell 2000 (792.86) The 200-day SMA is 796.49 with the 50-day at 815.46. Semiannual value levels are 577.47 and 530.04 with my annual pivot at 784.16, and daily, weekly, monthly, quarterly and annual risky levels at 794.76, 802.19, 817.74, 910.11, 930.83 and 978.58.
 
The SOX– (386.93) The 200-day SMA is 418.84 with the 50-day at 405.97. Weekly, annual and semiannual value levels are 379.02, 270.98, 258.97 and 204.67 with daily, monthly, quarterly and annual risky levels at 395.88, 459.15, 493.22 and 531.14.
 
Equity Fundamentals – Fairly Valued to Undervalued
  • 64.0% of all stocks are undervalued / 36.0% of all stocks are overvalued
  • Fourteen sectors are undervalued – Auto-Tires-Trucks by 8.0%, Computer and Technology by 8.4%, Industrial Products by 8.5% and Medical by 8.8%
  • Only two sectors are overvalued with Utilities overvalued by 3.0%
  • P/E Ratios – Range from 22.9 times for Aerospace to 50.5 times for Oils-Energy.
 
Definition of MOJO – This is my term for technical momentum. I use what’s called “12x3x3 slow stochastic readings” from daily, weekly and monthly charts. The scale is zero to 10.0 where above 8.0 is overbought and below 2.0 is oversold.
 
Richard Suttmeier
Chief Market Strategist
ValuEngine.com
(800) 381-5576
 
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As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.com. I have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters as well as my most up-to-date analysis of world markets. My newest products include a weekly ETF newsletter as well as the ValuTrader Model Portfolio newsletter. You can go to http://www.valuengine.com/nl/mainnl to review sample issues and find out more about my research.
 
“I Hold No Positions in the Stocks I Cover.”