Tuesday, June 16, 2020

The Economic Logic Stock Market Indicators

After 43 years of writing a financial newsletter, as one of my hobbies, I sent out the last letter on Sunday. It was a 16 page PdF version that was easier to read than prior, much shorter, Microsoft WORD files. Today I have cut and pasted a few items from page one of the last newsletter, with a few edits to fit into this format.
I'll work on an easier to read format for the next update. The good news is all ECONOMIC LOGIC content will be here, not in a newsletter every two months, and free, not $1 per newsletter 




Economic  Logic  Stock  Market  Timing  Indicators:            
AAII Sentiment Ratio ----- Moderately Bullish at 43.0% bullish (6/10/20 4-week average) 
Election Year Cycle --------- Bullish from June 2020 to June 2021
Seasonality Cycle --------- Bearish from May 2020 through October 2020 
Corporate Insiders ----------- Bearish (very few large buys in past few weeks)
Federal Reserve Policy ----- Bullish after a huge expansion of Fed Credit
S&P500 Price/Sales Ratio --- Bearish at 2.15x on June 12, 2020
S&P500 Dividend Yield -- Bearish at 2.3%, assume dividends = 50% of S&P500 2019 earnings  
Indicator Total   -1.5  =  Moderately Bearish        





Magic Decoder Ring:

The  Indicator  Total 
  Range  is  -7  to +7
Bullish = +3 to +7
Moderately Bullish = +1,5 to +2.5
Neutral = -1 to +1
Moderately Bearish = -1.5 to -2.5
Bearish = -3 to -7


For an individual undicator:
Bullish = +1 point
Moderately Bullish = +0.5 points
Neutral = 0 points
Moderately Bearish = -0.5 points
Bearish = -1 point

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