Weekly Commentary

The stock market continues to mark time, in the wake of the massive
overbought condition that arose on September 14th — right after the Fed
announced the latest round of Quantitative Easing. This type of action will,
in my opinion, lead to a rally to new highs.

$SPX remains well within the bullish channel that has defined
this market since the early June lows.

Equity-only put-call ratios are a bit mixed. The standard ratio
remains on a buy while the weighted ratio is technically on a sell signal.
However, unless there is a breakdown in the $SPX chart, we would not
act on any sell signals from other indicators.

Volatility indices remain low and in downtrends. That is bullish
for stocks.

In summary, we view the current action as a minor corrective
phase, prior to an upside breakout to new highs.

Note: if you are viewing a text version of this report, click on the
following link to see the charts: