the dow - overvalued fundamentally and overbought technically

8/7/2019 The Dow - 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 Newtown, PA. ValuEnginecovers 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

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Apr i l 29, 2011 The Dow - over va lued fundament a l ly and overbought t echnic a l ly

Stocks are trading under a ValuEngine Valuation Warning. The Dow Industrial Average has

been the leader and its daily, weekly and monthly charts are overbought. This is not a sellsignal but reflects the facts that stocks have moved beyond whats justified by a slower thanexpected economic growth and weak labor market. Fed policy is helping Wall Street reaptrading profits from commodity and stock market speculation, while Main Street has been leftstruggling with a higher cost of living thats being ignored by Fed policy.

Stocks are now trading under a ValuEngine Valuation Watch 61.7% of all stocks are overvaluedwith 16 of 16 sectors overvalued, 5 by double-digit percentages. A ValuEngine Valuation Warningoccurs when 65% or more of all stocks become overvalued. This last occurred on February 18 th, whichelped me predict a market pull-back of 6.7% for the Dow and 8.3% for the NASDAQ.

10-Year Note (3.311) My weekly value level is 3.430 with daily and monthly risky levels at 3.299 and

3.181.

Courtesy of Thomson / Reuters


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Comex Gold ($1536.3) Fed-supported commodity speculation continues with another all timehigh at $1538.8. My semiannual value level is $1452.6 with weekly, quarterly and daily pivots at

$1501.2, $1523.7 and $1536.7, and monthly risky level at $1559.9.


Nymex Crude Oil ($112.85) Fed-indorsed speculation resulted in another multi-year high at$113.97. My Semiannual value level is $107.14 with a daily pivot at $113.25, and quarterly and

weekly risky levels at $114.27, $116.86 and $120.52.



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The Euro (1.4818) The Federal Reserve policy ignores the dollar. Quarterly and monthly valuelevels are 1.4308 and 1.4170 with daily and quarterly pivots at 1.4746 and 1.4624, and weekly pivot at

1.4771. My annual risky level is 1.6367.


Daily Dow: (12,763) My monthly and weekly value levels are 12,481 and 12,404 with a daily pivot at12,707, and Thursdays new 2011 high at 12,776.14. My quarterly and annual risky levels are 13,774

and 13,890.



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S&P 500 (1360.5) My weekly value level is 1318.7 with a daily pivot at 1356.9, Thursdays new 2011high at 1361.71 and this months pivot at 1360.0. My quarterly risky level is 1500.4.

NASDAQ (2873) My weekly value level is 2744 with a daily pivot at 2878, Thursdays new 2011 highat 2874.59, and my monthly risky level at 2898.

NASDAQ 100 (NDX) (2410) My weekly value level is 2288 with a daily risky level at 2436, andmonthly risky level at 2477.

Dow Transports (5510) My annual value level is 5179 with daily, weekly and monthly pivots at 54195365 and 5371, and Thursdays new 2011 high at 5526.27. Transports are approaching its all timehigh at 5536.57 set in May 2008 despite near record fuel costs.

Russell 2000 (861.54) My weekly value level is 835.89 with daily and monthly pivots at 855.74 and856.67. Thursdays new 2011 high at 861.55 is also a new all time high.

The SOX (447.54) My weekly value level is 408.52 with daily and monthly risky levels at 452.09 and452.34 and the February 18th high at 474.33.

Definition of MOJO This is my term for technical momentum. I use whats called 12x3x3 slowstochastic readings from daily, weekly and monthly charts. The scale is zero to 10.0 where above 8.0is overbought and below 2.0 is oversold.

Thats todays Four in Four. Have a great day.

Richard SuttmeierChief Market Strategist

ValuEngine.com(800) 381-5576

To unsubscribe from this free email newsletter list, please clickhttp://www.valuengine.com/pub/Unsubscribe?

Send your comments and questions to [email protected]. For more information on our productsand services visit www.ValuEngine.com

As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.comI have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters awell 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 issuesand find out more about my research.

I Hold No Positions in the Stocks I Cover.

the dow - overvalued fundamentally and overbought technically

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