Stocks are Overvalued Fundamentally and Overbought Technically
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Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com.ValuEngine is a fundamentally-based quant research firm in N ewtown, PA. V aluEngine covers over 7,000 stocks every day. A variety of newsletters and portfolios containing Suttmeier's detailed research, stock picks, and commentary can be found http://www.valuengine.com/nl/mainnl T o unsubscribe from this free email newsletter list, please click http://www.valuengine.com/pub/Unsubscribe? Feb 8, 2012 – Stock s are Overvalued Fundament ally and Overbought Technic ally The Dow Industrial Average traded above its May 2 nd 2011 high, but I cannot ignore overvalued fundamentals and overbought technicals as the S&P 500, Dow Transports and Russell 2000 remain below their 2011 highs at 1370.58 SPX, 5627.85 Dow Transports and 868.57 Russell 2000. My overall neutral zone remains the same - between my quarterly pivots at 12,478 Dow Industrials, 1305.4 S&P 500 and 2777 NASDAQ and my quarterly / annual risky levels at 1363.2 SPX, 5448 Dow Transports and 829.03 / 836.15 Russell 2000. The yield on the 10-Year note is now cheaper than my semiannual pivot at 1.903 and tested 2.00% this morning. Gold is back above my quarterly pivots at $1725.5 and $1740.9. Crude oil moved back above its 50-day simple moving average at $99.23 with its quarterly pivot at $99.87. The euro vs the dollar moved above its 50-day simple moving average at 1.3057. Some not so good news you may have missed: According to the US Bureau of Labor Statistics only 13 of 100 biggest cities have bounced back from recession. Because of benchmark revisions the US workforce declined by 1.2 million in January. The Labor participation rate fell to 6 4%. 10-Year Note – (1.975) My annual value is 2.502 with my semiannual pivot at 1.903, and daily, weekly , quarterly and monthly risky levels are 1.835, 1.797, 1.687 and 1.347. Courtesy of Thomson / Reuters
