Klein Market Summary-September 17th, 2012

Klein Market Summary

September 17th, 2012

 Current Market Facts:

Technical Status Confirmed Rally – Beginning Week 8
Other Observations The markets have broken into new high groundSigns of accumulation still dominate market action
Feel of the Market New breakouts have been emerging

Important Levels on Key Indices:



Last Close






Nasdaq 100




S&P 500








Market Interpretation:

Last week, the indices continued to rise.  Even after they hit new high ground, the markets were under accumulation.  This subtle, but important distinction, demonstrates that there is powerful demand for stocks.  It shows that institutions are not just buying at support levels, but have the appetite for stocks at and above important resistance levels.

The market remains robust, powered by themes of iPhone 5, Kindle Fire HD, premium retailers, medical, homebuilders, and technology.  The breadth of leading stocks speaks to a strong, durable rally.  Most of the leading stocks are extended, at this point.  New breakouts are not likely to be as powerful as stocks that broke out months ago.

Joel’s Take:

Current headlines don’t look promising: unrest in the Middle East, tax increases, high unemployment that is becoming structural, the election, and Europe.  Yet, the market is moving with power.  In modes such as this, the market becomes forward looking.  The Fed’s QE3 is a policy that is designed to create inflation.  The purpose of this inflation was originally to create demand for real estate.  However, now it is an artificial method of creating wealth through asset classes like real estate, commodities, and most especially, the stock market.  The other very important effect of QE3 is that, by inflating the currency, the national debt is reduced, in real dollars. The ability of this government policy to push the markets higher should not be underestimated.

  • The Klein Market Summary is a professional interpretation of the general stock market conditions that is updated on a weekly basis.  Joel T. Klein is the portfolio manager of the investment partnership Blue Diamond Capital, LP. He writes the summary using select technical and fundamental data.  The Klein Market Summary is not intended to provide investment advice of any kind, and is only provided for the entertainment of the reader.  It is typically updated Monday morning, weekly.  Please e-mail info@kleinasset.com, if you are interested in receiving this free weekly update.
  • Past performance is not a guarantee of future results.  Due to market volatility, a fund’s performance may fluctuate.  Current performance may be less than previous results.  An investment a hedge fund when redeemed, may be worth more or less than the original cost.  Information above is not a replacement for the Fund’s prospectus.  This webpage does not constitute any kind of offer or solicitation.  Additional information on investment objectives and policies is in the Fund’s prospectus.  Ask your representative for a prospectus.

About kleinmarketforum

Klein Asset Management, LLC, formed in 2003, serves individual investors via a directional growth stock approach. When the market is in an uptrend, the firm seeks to exploit investment opportunities. When the trend is down or neutral, assets are protected. Klein Asset Management undertakes major market research projects. In many cases, these result in improved investment methods, which ultimately improve performance.

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