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The Dow had its Breakout, but Risky Levels loom elsewhere.

|Includes: DIA, GLD, QQQ, SPY, iShares 20+ Year Treasury Bond ETF (TLT)
Fundamentally we know that valuations are cheap mainly due to that low bond yield. We know that the ValuEngine forecasting model shows limited upside. Technically MOJO is overbought, and with the Dow above my quarterly pivot at 12,478 the upside is to quarterly risky levels elsewhere; 1305.4 SPX, 2777 NASDAQ, 2422 NDX, 5448 Dow Transports, 829.03 Russell 2000, and 390.17 SOX. The Dow opened at 12,573.65 on Tuesday then gradually declined to my quarterly pivot at 12,478 in afternoon trading. SPX stalled shy of its quarterly risky level at 1305.4. The yield on the 10-Year has tested my semiannual pivot at 1.903 again. Gold opened the week above my semiannual pivot at $1659.4 on Tuesday with this month’s risky level at $1706.7. Gold’s close was below $1659.4 and between its 200-day and 50-day simple moving averages at $1634.3 and $1677.1. Crude oil is being influenced by my quarterly pivot at $99.87 after failing at the low end of my zone of annual and semiannual risky levels at $103.58 and $104.84. Oil is above 50-day and 200-day simple moving averages at $98.91 and $95.55. The euro versus the dollar hit a 52-week low at 1.2628 on Monday with my quarterly value level at 1.2499, my monthly pivot at 1.2780 and semiannual pivot at 1.2980.
 
10-Year Note – (1.858) Semiannual and annual value levels are 1.903 and 2.502 with daily and weekly pivots at 1.858 and 1.880, and quarterly, monthly and semiannual risky levels at 1.687, 1.409 and 1.385.
 
 
Courtesy of Thomson / Reuters
 
Comex Gold – ($1651.7) Annual and weekly value levels are $1575.8, $1388.4 and $1569.2 with daily, semiannual pivots at $1658.2, $1635.8 and $1659.5, and monthly and quarterly risky levels at $1706.7 and $1740.9.
 
Courtesy of Thomson / Reuters
 
Nymex Crude Oil ($100.80) Daily and semiannual and monthly value levels are $98.52, $79.83 and $75.53 with monthly, and weekly pivots at $99.87 and $100.40, and semiannual and annual risky levels at $104.84, and $103.58 and $117.00.
 
 
Courtesy of Thomson / Reuters
 
The Euro – (1.2734) Daily, weekly, quarterly and weekly value levels are 1.2556, 1.2506, 1.2499 and 1.2467 with monthly and semiannual pivots at 1.2780 and 1.2980, and annual and semiannual risky levels at 1.4239 and 1.4405.
 
Courtesy of Thomson / Reuters
 
Daily Dow: (12,482) Monthly and semiannual value levels are 11,210, 8,425 and 8,336 with annual, daily, weekly and quarterly pivots at 12,312, 12,457, 12,430 and 12,478, and quarterly and annual risky levels at 12,796 and 14,032.
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Courtesy of Thomson / Reuters
 
S&P 500 (1293.1) Monthly and semiannual value levels are 1152.8, 841.7 and 829.9 with weekly and daily pivots at 1285.8 and 1299.6, and quarterly and annual risky levels at 1305.4, 1363.2 and 1562.9.
 
NASDAQ (2728) Weekly, monthly and semiannual value levels are 2670, 2432, 2012 and 1952 with my annual pivot at 2698, and daily, quarterly and annual risky levels at 2757, 2777 and 3232.
 
NASDAQ 100 (NDX) (2393) Weekly, annual, monthly and semiannual value levels are 2341, 2300, 2185, 1851 and 1743 with daily, quarterly and annual risky levels at 2412, 2422 and 2603.
 
Dow Transports (5168) Monthly and semiannual value levels are 4443, 4407 and 3778 with a weekly pivot at 5123, and daily, quarterly and annual risky levels at 5213, 5448, 5861 and 6111.
 
Russell 2000 (765.53) Monthly and semiannual value levels are 646.71, 572.90 and 510.81 with a weekly pivot at 755.22, and daily, quarterly and annual risky levels at 775.67, 829.03, 836.15 and 969.09.
 
The SOX– (385.22) Weekly, monthly, annual and semiannual value levels are 367.06, 310.48, 269.80, 277.90 and 194.47 with a quarterly pivot at 390.17, and daily and annual risky levels at 398.41 and 520.61.
 
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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.
 
Buy and Trade Strategies for Long Positions
  • Value Level – The price at which you establish an additional long position on share price weakness. This is done on a GTC Limit Order to buy weakness to the Value Level.
  • Risky Level – The price at which you remove a single long position or reduce a multiple long position on share price strength. This is done on a GTC Limit Order to sell strength to the Risky Level.
 
Buy and Trade Strategies for Short Positions
  • Value Level – The price at which you remove a single short position or reduce a multiple short position on share price weakness. This is done on a GTC Limit Order to buy weakness to the Value Level.
  • Risky Level – The price at which you establish an addition short position on share price strength. This is done on a GTC Limit Order to sell strength to the Risky Level.
 
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.
 
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