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Greed/Fear Ratio, Not P/Es, Drive Stock Prices

By  +Follow June 10, 2014 2:57AM
Tickers Mentioned:


    I sense some nervousness in the Street about the level of stock prices. I have been uneasy for a number of days, since I felt a major upward extension of the rally that started in April needed a robust rebound in the economy this spring, not just a good one.

    I see references to historic price/earnings ratios with conclusions based on current stock prices being above an average going back they don’t say how far. Averages can be worthless, or distorted at best, it all depends on the years covered and the events that impacted them. This is the kind of stuff  money managers feed computers who make their decisions for them.

    At extremes, P/Es signal opportunity to buy or sell, but their enormous range between high and low over the years reduces the credibility of an average significantly.

    The level of P/Es is a product of human emotions, greed and fear. While stock prices have soared over the last five years, I believe the greed/fear ratio is somewhere in the middle of extreme high and low.

    This market is not yet generating the overwhelming compulsion to buy stocks and especially to buy ridiculously over-priced stocks.  Actually, the extremes of the Greed/Fear ratio is not so much quantifiable as it is a matter of opinion, a well-seasoned sense of investors’ behavior.

    While some see P/Es  as high now, I don’t see the Greed/Fear ratio as high.

    Corrections – YES.   Bear market – NO.


    Odds favor a small correction at the open can reverse with a healthy gain for the day.

Support today is DJIA 16,876; S&P 500: 1,943; Nasdaq Comp.: 4,316

Resistance today is still  DJIA: 17,015; S&P 500: 1,959; Nasdaq Comp.: 4,341.

Investor’s first readDaily edge before the open

DJIA:  16,943

S&P 500:  1,951

Nasdaq  Comp.: 4,336

Russell 2000:    1,175

Tuesday,  June  10, 2014      9:15 a.m.


    The European Central Bank’s cut of its benchmark interest rate and announcement to employ additional measures to stimulate European economies stands to help the U.S. economy, as well. It did little to boost stock markets abroad which are trading at six-year highs, suggesting the move was already discounted. Even so, let’s consider it a  positive.



    At key junctures, I technically analyze each of the 30 Dow industrials seeking a reasonable near-term support and short-term resistance level. By technically studying the balances of buying and selling in each stock, then converting that data back to the DJIA using the “divisor” (0.1557159) I can get a better reading on the average itself.  The DJIA is a price-weighted average and subject to distortion by higher priced issues.

    As of June 9, the support for this  calculation is 16,801 and resistance is 17,176.

Note: My daily support/resistance levels are more short-term oriented.


HOUSING: Objective accomplished – will discontinue coverage

     I began to track the following housing stocks earlier this year, hoping to gain some insight into the strength of the economic recovery emerging from a severe winter.

    My reasoning was that a robust economic recovery cannot develop without a contribution from the housing sector.

    While the industry stats for housing lagged, the stocks rebounded in late May and to-date in June.

    Monday, PHM, KBH and DHI extended breakouts from consolidation patterns, TOL broke out of one, and BZH demonstrated strength within a consolidation pattern.          


Beazer Homes  (BZH)    $19.27

PulteCorp ($PHM) :  $20.23

Toll Brothers (TOL) :  $37.27

KB Homes  (KBH) : : $17.29

DR Horton  (DHI) : $24.61



      For detailed analysis of both the U.S. and Foreign economies along with charts, go to www.mam.econoday.com. Also included is an explanation of each indicator. If you want to know when the next Employment report or any other key report will be released that info is also there under “event release date.”


NFIB Small Bus. Optimism Ix. (7:30): May index up to 96.6 from 95.2

ICSC Goldman Store Sales (7:45) Sales down 2.8 pct. in June 7 week from a gain of 2.9 pct. the prior week.  Year/year  now +3.0 pct. vs +3.1 pct.

JOLTS (10:00) Job Openings/Labor Turnover


MBA Purchase Apps (7:00)

Treasury Budget (2:00)


Jobless Claims (8:30)

Retail Sales (8:30)

Bus. Inventories (10:00)




June 2    DJIA   16,717 Decision Time for Stocks ?

June 3    DJIA   16,743 Economy “Must” Accelerate,  or…

June 4    DJIA   16,722 Correction in Stocks Without Robust Economic Rebound

June 5    DJIA   16,737 Bulls Must Pick It Up, or Lose the Ball

June 6    DJIA   16,836 Easy Does It ! Dow 20,000, But Not in Straight Line

June 9    DJIA   16,924 Stock Market Breakout – Now What ?

A Game-On Analysis,  LLC publication

George  Brooks

“Investor’s first read – a daily edge before the open”

This email address is being protected from spambots. You need JavaScript enabled to view it.

Investor’s first read, is a Game-On Analysis,LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks is registered as an investment advisor. Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed as particularized investment advice or as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment decisions in keeping with their tolerance for risk.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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Results for BZH
Jack Trader
1 Sep 15 10:10:55
$BZH Company Shares of Beazer Homes USA, Inc. (NYSE:BZH) Drops by -1.17% http://t.co/8nX6f5K3o6
Thomas Collins
1 Sep 15 10:10:47
$BZH Beazer Homes USA, Inc. Analyst Rating Update http://t.co/4UofqYD91F
Thomas Collins
1 Sep 15 09:47:18
$BZH Beazer Homes USA, Inc. Analyst Rating Update http://t.co/0kSAaXLPxy
Market Int Center
1 Sep 15 08:19:59
Beazer Homes USA $BZH Trading Near $17.29 Resistance Level ( http://t.co/fFSNWo5HdG )
1 Sep 15 07:34:50
$ANFI huge bounce play like $ACI. 100%+ upside potential P/E of 3 $PLD $TQNT $MAC $BZH $ERF $SCS investors read http://t.co/L1jwUV6Bag
Market Int Center
31 Aug 15 08:52:09
Beazer Homes USA $BZH Trading Near $17.71 Resistance Level ( http://t.co/Dl2UkjtauL )
30 Aug 15 22:05:15
Gains Over 2500% In one Trade.. Subscribe Here! http://t.co/8WvnrVmkBS .. $BYM $BZH $BZT
30 Aug 15 03:54:41
BZH +1.94% Stock Charts $BZH Beazer Homes USA Inc. (NYSE) Last Updated: 08/30/2015 05:54:48 BZH Stock Chart - http://t.co/gtaNavYeCt
29 Aug 15 18:51:38
ZIV VelocityShares Daily Inverse VIX Medium Term ETN Bid Size http://t.co/xSmegh6WQ4 $ZIV $EUM $BZH $FXY #ZIV #stockmarket #nasdaq
29 Aug 15 18:39:03
EEM iShares MSCI Emerging Markets Bid Size http://t.co/KIMGB1SKqL $EEM $ED $CMS $BZH #EEM #finance #invest
29 Aug 15 18:38:38
ENDP Endo Pharmaceuticals Holdings, Inc. Current Price http://t.co/8bEWhVYLiY $ENDP $AFN.TO $GPRO $BZH #ENDP #stock #stock
29 Aug 15 18:35:33
BZH Beazer Homes USA, Inc. Bid http://t.co/QXEVta6V6E $BZH $CVS $CLX $SCO #BZH #stock #share
29 Aug 15 18:35:27
BZH Beazer Homes USA, Inc. % Change http://t.co/LorTEm7llu $BZH $A $NTEK $ENDP #BZH #nasdaq #finance
29 Aug 15 18:35:12
BZH Beazer Homes USA, Inc. 52Wk High http://t.co/VmzefIhpnE $BZH $XLI $TQQQ $XLB #BZH #pennystocks #stockmarket
29 Aug 15 18:35:11
BZH Beazer Homes USA, Inc. Short Sales http://t.co/R4ExZHWke7 $BZH $TSM.V $BNP.TO $AAU #BZH #stock #invest
IH News Desk
29 Aug 15 18:32:24
AEM Agnico Eagle Mines Ltd. Day High http://t.co/vjhIiUTWq9 $AEM $BZH $CSIQ $AA #AEM #invest #pennystocks
29 Aug 15 18:32:12
ABT Abbott Laboratories Tick http://t.co/piBldeS8j1 $ABT $TQQQ $BZH $BNS.TO #ABT #tradeideas #nasdaq
Lucky Jimmy
29 Aug 15 18:32:11
ADT ADT Corp. Open http://t.co/e5MHUSceFE $ADT $FAST $BZH $BP #ADT #stocks #nasdaq
29 Aug 15 10:40:02
$BZH: Wall Street analysts bullish on BZH's earnings growth: http://t.co/m5egeSwGaO http://t.co/6Razp1GAwr
John Turner
28 Aug 15 07:33:29
$BZH Large Inflow of Money Witnessed in Beazer Homes USA, Inc. http://t.co/OhFECgm3Z0
27 Aug 15 15:04:51
Scan results - Stochastic Buy Signal today: $FCX $PSG $TFM $VMC $INTU $TUP $CPN $BZH $UVE $NWSA ... http://t.co/6SfkZZW2lM
Media Sentiment
27 Aug 15 06:11:29
$BZH received a new alert. Find out why at http://t.co/nZwqReM0tj #stocks #daytrading #trading #mkt #NYSE #NASDAQ #markets 169
Market Int Center
27 Aug 15 06:10:01
Beazer Homes USA $BZH Showing Bearish Technicals ( http://t.co/Mjta6g48AY )
26 Aug 15 21:11:02
$BZH is rated BUY, 20.6% upside by Wall Street analysts based on average ratings/targets http://t.co/NVNHXgUyEJ http://t.co/tTpHbcZTww
Chet Malhotra
26 Aug 15 11:12:24
@GrantDossetto @DougKass @thirdgenwidget @DividendMaster Luckily $TOL, $BZH, $KBH, $ITB don't have exposure..Oh Wait. http://t.co/HxgDQcKYyD
26 Aug 15 09:39:02
$BZH: Beazer Homes USA Receives $18.83 Consensus Target Price from …: http://t.co/PGsONfD3PC
Stock Trade Alerts
26 Aug 15 09:32:36
5-min Candle Alert $BZH - BEAZER HOMES USA #daytrader #stocks ~ via #AlertTrade
26 Aug 15 09:16:45
BZH 16.10 Beazer Homes USA $BZH added to my watch list. Right now with BZH I am watching the last price 16.10 http://t.co/ZupPZmYWcr
Seeking Alpha
26 Aug 15 04:00:13
New Home Sales Miss Expectations - Data Is Questionable http://t.co/vx3kKvnkUQ $BZH $DHI $KBH $LEN $MDC $PHM $RYL $TOL $XHB
Stock Market Outlook
26 Aug 15 04:00:12
New Home Sales Miss Expectations - Data Is Questionable http://t.co/PRRpt1LpN6 $BZH $DHI $KBH $LEN $MDC $PHM $RYL $TOL $XHB
Quantpost Industrial
26 Aug 15 04:00:12
$DHI News: "New Home Sales Miss Expectations - Data Is Questionable $BZH $DHI …" http://t.co/XBMpAx7aUY Analyze: https://t.co/Icj4fnuKA0
Seeking Alpha
26 Aug 15 04:00:11
New Home Sales Miss Expectations - Data Is Questionable http://t.co/IOFVoXbJBp $BZH $DHI $KBH $LEN $MDC $PHM $RYL $TOL $XHB
Chet Malhotra
25 Aug 15 15:04:57
@GrantDossetto @jessefelder @DividendMaster @DougKass @gubbmintcheese @thirdgenwidget U2 on $BZH!
Daily Contracts
25 Aug 15 12:52:02
Real-Time feed of company contracts, original agreements and executive updates from $BZH http://t.co/LKQMm4wsRZ
25 Aug 15 12:05:49
$BZH short 16.03
Market Int Center
25 Aug 15 05:59:59
Beazer Homes USA $BZH Showing Support Near $15.05 ( http://t.co/RDdC0llK6N )
Paula Treneer
25 Aug 15 01:04:21
Housing provides shelter from market storm -- Ahead of the tape http://t.co/ZYhnDeygzn via @WSJ $XHB $ITB $DHI $TOL $BZH
24 Aug 15 22:26:12
This Service Made 20,000% Gains In the Last Month! Subscribe Here http://t.co/8WvnrVmkBS .. $BYM $BZH $BZT
John Turner
24 Aug 15 10:36:35
$BZH Beazer Homes USA Inc (NYSE:BZH) in Hot Water http://t.co/BEjFAE1Jeo
Breaking News
24 Aug 15 09:14:03
$BZH: Will Beazer Homes USA, Inc. (NYSE:BZH) Meet Analyst Targets?: http://t.co/xBEvGoPaMS
DE Asset Management
24 Aug 15 07:35:22
RT @SeekingAlpha: Beazer Homes Looks Cheap On Strong Pricing Trends http://t.co/MfAU6QuAx1 $BZH
Peter Bardens
24 Aug 15 07:05:43
$BZH Beazer Homes USA Inc (NYSE:BZH) in Hot Water http://t.co/kf5Mnolmz9
Long & Short Ideas
24 Aug 15 07:03:13
Beazer Homes Looks Cheap On Strong Pricing Trends http://t.co/IkYlLHv3IG $BZH
Seeking Alpha
24 Aug 15 07:03:13
Beazer Homes Looks Cheap On Strong Pricing Trends http://t.co/MfAU6QuAx1 $BZH
24 Aug 15 05:12:03
$BZH: Beazer Homes USA Inc (NYSE:BZH) in Hot Water: http://t.co/JhwHfNW1m1
By  +Follow June 10, 2014 2:57AM



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