MarketsWHY TOO MANY ANALYSTS CAN SPOIL THE BROTH

Marty Zweig who is one of the best once taught a class where he mentioned that one of his better indicators for market direction was the number of tout sheet ads for bullish or bearish news that ran in Barron's each week. That when 60% of the ads were bullish he got very scared, and vice versa. What this means is that even with good analysts, once all the selling or buying is in the market, the market has to change direction. That is because there are either no more sellers out there or no more buyers. When I made my scare observation earlier this week I was not yelling in the wilderness. Others saw and see the same thing (genius is not existant in the markets). As of Friday most newsletters are warning their readers. This mass warning makes a big correction less likely because the big players will hedge with options or futures. So while the market still looks uncomfortably vulnerable to a major correction, my concerns are shared by too many. Just watch your stops. The jobless claims were stinko but everything else is strong. People who look at PE ratios (I believe those numbers are worthless) see the market as "over valued". Just watch the moving averages of the Indexes. Christmas is not necessarily a light volume time. This is the month for tax squaring. Many sell in late December and immediately buy in early January. I can also tell you that when I was a broker, December was one of my biggest months at least half the time. Don't go on vacation from your market watching. December can be a dinosaur month.