FIBs

Fully Invested Bears.  This market is epitomized by bullishness being a mile wide and an inch deep.  I do think there are more bears than there are bulls now.  That doesn't mean that we're done going down.  Because many of those bears are fully invested.  Of course, bears would never be long momentum stocks, they are prudent folks, that look at P/E ratios and cash flows.  So they are long value stocks, the ones that have no growth but have low P/E ratios.

So while it hasn't really paid to sell on weakness for the past 2 years, I think we are going to have longer pullbacks now.  The high day to day volatility we've seen while the market hasn't really gone anywhere near the top is a symptom of a trend change.  Treasury strength is another indicator.  We've gotten so-called good economic data in NFPs, jobless claims, and today's PPI coming in a little high, but that is looking in the rearview mirror.

The financial economy has been so distorted by QE that it is a reflection of itself.  If you see a weak stock market, that signals a weak economy.  A strong stock market, a strong economy.  The people in the market are mostly immune to small ebbs and flows in the real economy, they depend on how the Nasdaq, S&P, and interest rates are trading.  Economic data doesn't matter as much, because we all know that a 10% drop in the S&P, or a spike in 5 year yields is much more significant to the Fed than a couple of bad job reports in a row (Jan and Feb).

Remain in my bearish stance, long Treasuries.  We might get a bounce early next week, but not interested in playing that unless we see some blood on the Streets today.