Track Record

In a PBS Wall Street Week show in the beginning of the year the "10 Elves," representing mainstream Wall Street technical/strategic pundits and forecasters, had not a single bear among them! For both the Dow and the Nasdaq over the next three months, nine were bullish and only one was neutral and a lot of the well known Wall Street names saw a bottom ahead.

More comments:

2/14/2001-"Greenspan Sees Quick Rebound."

12/1/2000-"The worst is over for technology. Stocks will appreciably outperform bonds over the next 6 months." -Christine Callies, Merrill Lynch.

11/2000-Goldman Sachs' Abby Joseph Cohen, one of Wall Street's most widely watched strategists, said stocks are a great buy now. The S&P 500 index is about 15 percent undervalued, Cohen said. She expects it to hit 1560 by year end.

If you watch CNBC now there are suddenly only bears around and everybody has of course foreseen this decline.

In this bullish environment we stuck our neck out and predicted a correction in our subscriber section back in January when the S&P stood at 1360. At the same time by e-mail, (January 26th, 2001 at 15:31), we offered some bearish charts to our colleague Larry Hoffenberg from Bearmarketcentral for publication. Below you find a copy of this message:

----- Original Message ----- From: Global Futures   To: webmaster@bearmarketcentral.com   Sent: Friday, January 26, 2001 3:31 PM
Subject: Re: Chart of the Week > Hello Larry Hoffenberg, > > enclosed are some charts which are so bearish that you will grow a fur.

1) A daily chart of the SPX for comparison

2) The Arms Index (TRIN) on a 10- day moving average in bearish territory

3) A daily put/call ratio on a 10- day moving average approaching bearish territory

4) The Large Block Index shows extreme optimism of institutional investors which is bearish

5) Short sales by NYSE members, the so called Smart Money, reached very high levels

6) The number of bulls (Investors Intelligence) compared to bears shows high bullish sentiment

7) The call/put ratio of the open interest of all CBOE options reached unprecedented levels

8) The same applies to the open interest of SPX options

9) The call/put ratio of OEX traders shows that these guys, who like to call themselves contrarians, view the recent pull back as the buying opportunity of the decade

10) The long/short ratio of small traders in S&P 500 index futures, according to the CFTC Commitment of Traders Report, shows extreme bullishness by the small guys

11) The short positions of commercial hedgers (the smart guys) in S&P 500 index futures, according to the CFTC Commitment of Traders Report, shows the highest ratio since we follow this indicator

12) Program traders, often called the culprits of the 1987 crash, account now for nearly 30% of NYSE volume on a 4- week moving average