PreMarks 11.07.11

I think stocks are going to be higher by year end {based on what we currently know}.  Irregardless of my longer term optimism, I think we could churn around a bit between now and Thanksgiving.  That also means we could go a bit lower in the next few weeks.  One of my main arguments is that we are currently short term overbought.  You've seen before how I measure this in my chart work {see here }.  Here is another way:

According to Bespoke Investment Group , "85% of stocks in the S&P 500 remain above their 50-day moving averages. Even at this level, besides the last several days, it's higher than it's been at any other time since last November.  Three sectors have more than 90% of stocks above their 50-days -- Financials (93%), Energy (95%) and Utilities (94%). Technology is just under 90% at 89%. Health Care, Consumer Staples and Telecom -- all defensives -- have the weakest breadth readings."  But even those readings by Bespoke's measurements are high.

Stocks are moderately weaker as we begin the week.  But well off their lows in premarket trading.

Link:  Bespoke: Stocks above their 50 day moving averages.

*Long ETFs related to the S&P 500 in client accounts.  Long ETFs related to energy, technology and financial sectors in both client and personal accounts.  Long ETFs directly related to health care and utilities in certain client accounts.  Also please note that all of these sectors mentioned above are represented in many of the broader based ETFs we own for clients.