The Index Trading Weekly Newsletter Is now accessible directly from an RSS Feed. If you have a My Yahoo account or an My Msn account go to the Weekly newsletter page to register and you will be advised immediately when changes occur on the site either with trading signals, weekly newsletter or any other changes on the site. You can also create a new entry in an RSS reader. Click Here to register for RSS Feed Please note that the next number will be December 16th. Markets pausing All markets are now slowing their upward move We can now start to observe resistance (SP500 at 1400) Recent ecocnomic data about ISM manufacturing under 50 for the first time in 3 years is worrying investors about economic slowdown. Markets pausing Last trades update Index Market Last signal Entry date Entry Price Current Price Win / Loss 2 weeks Change # cycles completed SP500 Sell September 21 2006 1318.03 1396.71 -78.68 -4.49 2 ND100 Sell September 21, 2006 1634.87 1775.12 -140.25 -25.55 3 Dow Sell September 21 2006 11533 12194 -661 -148 2 SP500 Last Signal Comment Our current sell signal is way behind. SP500 is now under downward pressure. We can observe a certain resistance at 1400. We can also see bigger and bigger negative divergences when we analyze the 2 recents tops. If we mix that with last friday latest reading on ISM manufacturing under 50 for the first time in 3 years, we must start to be cautious from now on. Economic slowdown discussed earlier might be more serious than anticipated. It may not hit the market now but may in february and march if it continues in the same direction. We can now expect to see the market finally touching the lower band in the next 2 weeks. 1325 is now our first support. 1220 is our next support. 1170-1180 support level is our third support level. ND100 Last Signal Comment Our current sell signal is also way behind for now. ND100 is retreating again to the moving average after a quite bad week. This market is getting more volatile and is also showing negative divergences. We can now expect this market to touch the lower band any time soon. We can consider that our first support is now at 1450, our next support at 1400 and the next one at 1320. DOW Last Signal Comment We are now way behind on the current sell signal. DOW is also setting back with more volatility than before. We observe like other markets negative divergences. DOW also responds to the latest reading of ISM manufacturing. We can now expect this market to touch the lower band any time soon. Our first support is now at 10650 and our next support is at 10200. Special Option Strategy Update Our latest PUT for december SPX 1325 sold at 1.10$ now worth 0.80$. It should be OK with 2 weeks before expiration. Always remember that you need between 11,000 and 15,000 USD margin for each contract. Short term Options Welcome to this new trading service. With this service we should have every month good opportunities. Click here to find the options trading signals page. We had no trades in the past 2 weeks. Also RKH (financial index) BBH are near to be entered. So stay tuned for any signal. Index markets may give us a chance in the coming 2 weeks. We now have new target numbers for all our covered markets. See full instructions on options signals page for more details. Please use the link mentionned above to see the target numbers. Check every day on the page to see if the numbers are changed. Of course we are far from a possible entry for now but we never know. Economic Current Conditions Table of Economic Numbers Economic Info November 2006 October 2006 September 2006 August 2006 July 2006 Juin 2006 May 2006 April 2006 Mars 2006 February 2006 January 2006 December 2005 November 2005 PPI -1.6% -1.3% +0.1% +0.1% +0.5% +0.2% +0.9% +0.5% -1.4% +0.3% +0.6% -0.7% Core PPI -0.9% +0.6% -04.% -0.3% +0.2% +0.3 +0.1% +0.1 +0.3% +0.4% +0.1%- Retail Sales -0.2% -0.8% +0.2% +1.4 -0.4% +0.1 +0.8% +0.6% -1.4% +0.7% +0.7% +0.8% CPI -0.5% -0.5% +0.2% +0.4% +0.2% +0.4% +0.6% +0.4 +0.1% +0.7% -0.1% -0.6% Core CPI +0.1% +0.2% +0.2% +0.2% +0.3% +0.3% +0.3% +0.2 +0.1% +0.2% +0.1% +0.2% Housing Starts 1.486M 1.74M 1.67M 1.795M 1.85M 1.953M 1.863M 1.96M 2.12M 2.28M 1.933M 2.12M Building Permits 1.535M 1.638M 1.72M 1.747M 1.869M 1.946M 1.98M 2.06M 2.15M 2.22M 2.08M 2.16M Employment +92,000 148,000 188,000 121,000 124,000 92,000 126,000 200,000 225,000 170,000 140,000 305,000 Durable Goods Orders -8.3% +7.8% -0.50% -2.4% +3.1% -0.3% -4.7% +6.1% +3.4% -10.2% +2.5% Durable Goods Excluding Transportation -1.7% +0.1% +0.5% +1.0% +0.7% -1.1% +0.6% New Homes Sales -4.0% +5.3% -3.0% -4.5% -3.0% +4.6% -4.9% +18.0% -5.5% Existing Homes Sales 6.24 Millions 6.21 Millions 6.30 Millions 6.33 Millions 6.62 Millions 6.67 Millions 6.75 Millions 6.92 Millions 6.91 Millions 6.56 Millions 6.75 Millions ISM Index(Manufacturing) 49.5 51.2 52.9 54.5 54.7 53.8 54.4 58.9 55.2% 57.2% 54.8% 55.6% ISM Services 57.1 52.9 57 54.8 57.7 60.1 63.0 56.8% 61.0% Factory Orders -0.6% +1.2% +0.7% -4.5% +1.1% GDP(Gross Domestic Product) Numbers 3rd Quarter 2006 2nd Quarter 2006 1st Quarter 2006 4th Quarter 2005 3rd Quarter 2005 2.2% 2.6% 5.6% 1.7% 4.3% 3.3% Inflation Numbers Year to year inflation according to core CPI is now at 2.7% In the last 2 weeks we had several major economic news. See the table above for all numbers. Building permits for october was down 6.2% and housing starts for october were also down the same magnitude. Durable good orders were down a sharp 8.3%. Existing home sales were up a little du to lower prices. New home sales were down almost 4%. ISM manufacturing for november was at 49.5, under 50 for the first time in 3 years. A reading under 50 indicates compression in the sector. All those readings are mostly under expectations and might indicate a bigger economic slowdown than anticipated. It is good for inflation but a bit too low for economic expansion. If we continue over the next 2 months to get readings like that we will end up into a market crash. The crude came back above 60$ not good for the market. Lower prices were short lived as expected and prices are up again just like last year. The prime is still at 5.25. With latest readings on inflation numbers and bad economic readings we can start to say that rated decreases are uncertain about where it might take place next year. The SP500 PE ratio is at 18.70 according to june results. We can almost say that for september estimates we are at about 18.25 which is still considered low but less comfortable then earlier in the year. Remember that when the last major economic cycle that started in march 2003 the PE ratio was at around 16. So we are at the low end. Despite the fact the PE is not too high we will have to watch for a possible bear market later in the fall for the coming year. Our last major bear market was on july 2002.