As we alluded to last week, we believe that the major stock Indices have now put in at least a short-term bottom and could be poised for a multi-week rally. However, we cannot be certain at this point whether the recent low reached on July 15/08 will mark the end of this Bear Market or if the rally will be a relatively short lived respite from more pronounced selling.

We wish you the best of luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingequity.com

The S&P 500 Index continues to make fresh new closing lows on a weekly basis confirming our contention that the US equity markets are mired in a Bear Market. However, "the street" is alive with dire predictions for the economy and stock market. Therefore, from a contrarian standpoint we would not be at all surprised if the US stock Indices begin a counter trend Bull rally over the short-term within the context of an ongoing primary Bear Market.

We wish you the best of luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

The decrease in the strength of our TE Index last week was almost entirely due to a decline in our Primary Trend Indicators. This was coupled with slightly lower investor Sentiment readings. These were partially offset by marginally lower long-term interest rates and improved Valuation readings. In conclusion, we believe that the fresh new closing low in the S&P 500 Index for 2008 at 1261.53 pts underscores that a Bear Market in US stocks is the immediate problem at hand.

We wish you continued good luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

Last week witnessed more stock market weakness as the Nasdaq 100 Index fell 1.23%, the Russell 2000 slipped 0.95% and the S&P 500 Index got nipped by 0.06%.

However, all three of the losses for the week would have been much larger had the stock market not rallied significantly on Friday. Friday's rally was apparently in response to a "in line" core consumer price inflation report of 0.20% for the month of May 2008.

We would argue that the stock market had become oversold, highlighted by a smattering of heightened investor anxiety readings as witnessed by our investor Sentiment Indicators.

Also, of note is the fact that the yield on the US 30-year Government Bond climbed to a level of 4.80% on Friday. We would like to see the yield climb another half a percent or more before we anticipate the stock market would have significant trouble digesting the higher interest rates.

We wish you continued good luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

We note that the Nasdaq 100 Index continues to act with outsized bullish vigor. This is not surprising given that this is the Index where excessive investor confidence, usually following a lengthy rally, is most prone to be pronounced. Very often this is a warning sign that the stock market is in a bit of a blow off phase where a subsequent decline develops.

We wish you the best of luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

We would suggest that if last weeks closing prices marked a "high water point" for the current stock market rally, then the excessive investor enthusiasm that was signaled by the very heavy flow of funds into the Rydex group of Mutual Funds Bull Funds, did a very good job of warning us of trouble ahead for the major indices. However, having said this, there is a bias for the stock market to behave itself in the period following the Memorial Day long weekend and into the first part of June. Thereafter, we would expect the indices to run into significant trouble and recommence their decline.

As always, we wish you the best of luck with your investments in the future.

Yours sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

The TE Index stubbornly refuses to confirm that the bear market has indeed ended. Importantly, while stocks continue to gather strength, small investors are slowly but surely beginning to take on more risk. While this risk taking has not yet reached an extreme, it is still significant enough to warn that the current rally could be closer to culminating then one would normally expect. Hence, this rally has every opportunity to be, in hindsight, a bear market trap.

We wish you the best of luck with your investments in the future.

Sincerely,

Anthony Waller
President
http://www.timingequity.com

Our best wishes right now are for the markets to put in a bottom fairly soon, then begin a rally. At the same time, we would love long-term interest rates to behave themselves and, in fact, begin a new short-term rally themselves. In this scenario, the TE Index would, in all likely-hood, begin to improve day the day and then after about a month of the final bottom issue a new buy signal to usher in the next bull market.

We wish you continued good luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingequity.com

Our TE Index is well off from issuing a bullish signal. The main reason for this is that our Primary Trend Indicator issued a Bear Market warning in mid January 2008 from which the S&P 500 Index has not materially improved upon. While the major US Stock Indices can meander up and down from week to week we will need to see the S&P 500 Index improve noticeably from current levels and for a sustained period of time before we can hope that the Bear Market, by our definition, is over.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingequity.com

Given the relative position of our TE Index Indicators we would expect more choppiness in the couple of weeks ahead. The primary argument for such a position is the relative weakness in the US 30 year bond. In fact, the yield on the long bond has climbed from a low of around 4.10% to a recent high of close to 4.70%. This is a rather demonstrative move higher and would issue a warning that Asset Allocation managers may begin to allocate more funds to the relative safety of the US Government Bond Market then risk it in a fragile US Equity Market. Countering this, however, is the extreme pessimism amongst Investment Advisors in some of the published reports we follow such as "Investors Intelligence". In the vast majority of cases, when investment counselors get as bearish as they are now the stock markets tend to rally over at least the short to medium term. However, after a descent rally, they often change their positions quickly and become more bullish, which sets the market up for more retrenchment in the weeks following.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
www.timingequity.com

The major US stock Indices rallied hard this week as the projected 50 basis point cut in the Federal Funds and Discount Rates were greeted with enthusiasm by stock traders and investors alike. Not even a surprise decline in non-farm payrolls on Friday could knock the market down. This is something that should come as no surprise as the combined 1.25% drop in interest rates over the past week and a half has fully lubricated the financial markets. A test of sorts will come next week as, by most measures, the stock Indices are overbought on at least a short-term basis and are prime for some profit taking.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingequity.com

The US equity markets continue to grovel for, at least, a short-term bottom around current levels. With the US Federal Reserve expected to cut the Fed Funds and Discount Rates by an additional 50 basis points this coming Wednesday, the stock markets will have been fully lubricated with 125 basis points of easing in just over one week. This amplitude of liquidity into the financial system cannot be easily ignored. We would suggest that the Fed’s main impetus for such a dramatic lowering of interest rates is in an attempt to allow the yield curve to quickly steepen. This would allow the major lending institutions to begin making significant amounts of money by borrowing short and lending long once again. However, as the yield curve steepens, stock valuations come in to question, as the yield on long-term bonds then become an attractive investment alternative for Asset Allocation managers at the expense of investing in the stock market.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingequity.com

It was a very volatile week on Wall Street that culminated in a up, down then up again move on Friday. Our TC Index, at -124.27 pts, remains solidly in Bullish Mode for the Nasdaq 100 Index. The TC Index is broken down into three components. The first and most powerful is our Primary Trend indicator. Next are our investor Sentiment and long-term Interest Rate components. Currently the Primary Trend is very bullish, albeit maybe a tad to much. This means that the Nasdaq 100 Index has a good chance of consolidating its stellar run, from the August 2007 lows, over the next couple of weeks. Our investor Sentiment indicator is showing some heightened investor angst. This could be a precursor to the consolidation that we see occurring in the Nasdaq 100 Index over the short-term. Our long-term Interest Rate indicator is very bullish. With the yield on the 30 year bond now well below 4.75%, Asset Allocation managers may well support the stock market on any sizeable decline at the expense of purchasing more Government Bonds.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

The major stock market indices rallied nicely this week, as anticipation over the next Federal Reserve meeting on September 18, 2007 grew stronger.
My guess is that a 25 basis point cut in the Federal Funds rate is already priced into the stock market as of Friday's closing levels. Further, I would surmise that the equity markets are craving for a 50 basis point ease in the Fed Funds rate on Tuesday, coupled with an equally strong cut in the Discount Rate that the Federal Reserve charges other banks. Anything short of a 50 basis point cut in the Fed Funds rate will probably lead to at least a one day sell-off in the stock markets. Moreover, the accompanying statement that the Fed always issues will be scrutinized for any hint that the Central Bank is on alert to the possibility of further rate cuts should economic reports issued between the September 18, 2007 meeting and 6 weeks hence prove to be weak in the aggregate. The TC Index is suggesting that the next two week period should continue to be constructive for the equity markets. Although given this, the TC Index's value changes every day, and therefore it is better to be monitored on a daily basis for any significant change. The Economic Cycle Research Institute's latest reading is for a marked slowdown in the US economy over the coming months. However, they continue to dismiss a recession over the near-term horizon. If their analysis continues to be correct, this projection would be welcome news for those investors who are long the market over the medium term.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

"This week saw tremendous buying pressure across the board from stock market bulls. What a difference a week makes. As we alluded to last week, the Board of Governors at the Federal Reserve voted to lower the discount rate by 0.50% last Friday. I believe the stock market gains of this week were in direct response to that decision. Remember, for the period January 24, 1958 to February 22, 1993 there were 16 occasions that the discount rate was dropped by 0.50% or more. Over successive 12 month periods of such an occurrence, the S&P 500 Index gained on average 21.80%. I am relatively happy with the manner in which the TC Index handled this latest stock market correction. During the correction the TC Index generated three trade signals. All of which, to date at least, have proven profitable, if each only by a small margin. I am most happy that the TC Index had us out of the market during the bulk of the sell-off, where the tendency for most traders would have been to sell at or near the bottom during the panic selling. However, given the overbought nature of the major stock indices now, I would not be surprised to see the market decline over the new few to several trading days in order to bring it back to a level where traders should want to push it higher again. The TC Index was designed to issue just 3 to 5 trades per year. Given this, my hope is that the stock market improves steadily over the coming weeks and months in order to negate the need to issue another trade signal over the short-term", said Anthony Waller, President of Teabull Asset Timer Ltd.

http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

It was a very interesting week on Wall Street and, in fact, on equity markets around the globe. Last Friday's tentative rally soon gave way to tenacious selling on Tuesday and Wednesday of this week and culminated with a thud lower at around mid-day on Thursday past. I believe that there is a very good chance that the mid-term low for this correction was put in place this past Thursday at around the S&P 500 Index 1370 pt level. Moreover, I believe the stage is being set to engender a significant stock market rally over the next few months. While this is conjecture at this point, there is some quite overwhelming historical statistical evidence that supports this viewpoint. For those of you who are unaware, the Board of Governors at the Federal Reserve Board voted unanimously to lower the discount rate charged by the Federal Reserve Bank to the banking system by 0.50% this Friday morning. My research into such happenstances in the past found the following encouraging news. For the period January 24, 1958 to February 22, 1993 there were 16 occasions that the discount rate was dropped by 0.50% or more. Over successive 12 month periods of such an occurrence, the S&P 500 Index gained on average 21.80%. This, against the long-term average yearly gain in the S&P 500 of approximately 10.00%. I also believe, sadly, that small investors displayed extremes in fear and panic this Thursday. This was evidenced by the extremely heavy volume selling of the Nasdaq 100 Index, when on Thursday the Indexes tracking stock, the QQQQ's, were down by close to $4.00 or 10%. So where does the market go from here? Typically, after such savage declines as the markets have experienced over the past couple of weeks, an event occurs in one to two weeks hence that causes another round of profit taking and heavy selling. It is in this process that the prior low is tested to ensure there continues to be sound reason for strong price support at those levels. If completed successfully, stocks are, by and large, firmly in control of strong hands, with the speculative juices and overleveraged investors having been fully wrung out of the system from the prior frothy rally. While there is no guarantee the market will behave in this precise manner going forward, their is at least the possibility that such an occurrence will unfold according to plan.

We wish you all continued good luck with your investments in the future.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

The stock market showed more concerted downward pressure on Friday of last week as investors lightened up on stocks that they didn't want to hold over the weekend. I would guess that the stock markets were swamped by sell orders late Friday for fear the markets could open decidedly lower on the following Monday. You may wonder how the TC Index strengthened this week with the continued stock market correction? The main reason for this is that our measure of investor Sentiment is showing extremes in investor anxiety and outright panic. At current panic levels, the TC Index has consistently come within a few percentage points of marking a mid-term bottom in the major indices over the past 17 years of back testing and live trades. However, we may still have to go down another few percentage points in the S&P 500 Index before the last of the sellers are washed out and a selling vacuum is put in place.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

* Although the major US stock indices declined noticeably on Tuesday, July 24/07 we would expect at least a modest technical rebound on Wednesday July 25/07. Our market timing system is not geared for short-term forecasting but it is interesting to consider the following after such a marked decline in the broad indices.

Down volume swamped up volume by a measure of 13 to 1 on Tuesday. There have been only 4 other times that selling has reached such an extreme since March of 2003. On average, the next day saw a rebound of approximately 1.0%. Furthermore, looking at daily charts of the Dow 30, S&P 500, Nasdaq 100 and Russell 2000 Indices all reveal that the latest price declines have penetrated each Indices lower Bollinger Bands rather significantly. In fact, by this measure alone the Russell 2000 is oversold on a mid-term basis as well because its weekly lower Bollinger Band has also been penetrated rather dramatically.

We would call this market short-term oversold and are further positioning our portfolios to take advantage of what could prove to be an oustanding short-term buying opportunity.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

* Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.

The stock market was hit hard at the end of this week, as poor earnings from the likes of Google and Caterpillar put a damper on things. However, we continue to remain mid-term bullish on the prospects for the equity markets. During earnings season it is especially hard to predict the short-term with any kind of consistency. This is because earnings results can vary in batches, either good or bad from day to day. Thus, we will take Friday's decline with a grain of salt and look forward to a slowly improving US economy, low inflation and low long-term interest rates to help guide us on the bullish side through the daily grind of a vacillating stock market " said Anthony Waller, President of Teabull Asset Timer Ltd.

Sincerely,

The TimingCrystal Team
http://www.timingcrystal.com

The major stock indices regained their footing this week and by most measures posted solid gains. Therefore, our Primary Trend remains, for the time being at least, firmly in bullish mode. The past week was highlighted on Friday by the US Government's release of solid employment data coupled with benign inflation readings and a decent manufacturing report in the form of the ISM. The economic backdrop is conducive to a continuation of an upward bias in stocks. However, we would caution that a one to two percent pullback in the major averages should come as no surprise to investors with longer-term investment horizon. In fact, we are most bothered by growing investor complacency that we believe, when at an extreme, will spell the end to this up leg in the ongoing US equity bull market. Furthermore, as bond yields rise and prices drop Asset Allocation managers may begin, quietly, shifting some of their investment capital into the relative safe haven of the debt market at the expense of equities.

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

The consolidation, congestion in the S&P 500 Index led to the increase in the TC Index this week as the major markets finally took a breather from the torrid upward pace they've been exuding for nearly 10 weeks now. However, our Primary Trend remains firmly entrenched in Bullish Mode. Mr. Greenspan gave his "shot across the bow" warning on Wednesday that the Chinese stock market was due for a dramatic decline imminently. US stock investors took this warning as meaning that there would be a contagion effect like that of February 27/07 heard round the world's stock markets. Thus, what was turning into another strong up day gave way to significant selling pressure Wednesday afternoon and into Thursday's session. Finally, the markets recovered lost ground on Friday as the "buy on the dip" mentality continues all to well in this momentum driven market. I am growing somewhat more bearish as the yield on the US 30 year Bond continues its recent ascent, finishing Friday a tad over 5%. In addition, there is growing complacency in the markets, as fear has receded markedly over the past 2 months and has been replaced with the firm conviction on the part of most investors that a buy and hold strategy will win out over the long term. We shall see. It was this same brashness that propelled the equity markets to insane levels through the 1990's and into the year 2000. Although I don't think we are at an imminent top in the market, the seeds are being sown for a stiffer correction that will entice the bulls to buy the market on the first pullback, only to see the market shift lower still. Why then are we still long the market you might ask? The simple answer is that we don't seem to be at the top just yet. There continues to be amble liquidity driving the market higher and the last thing we want to do is fight such a strong tape. As long as the bond market settles down, which will mean a commensurate continued moderation in inflation, it looks like the bulls will continue to hold the upper hand. For now at least. But as Charles Dow said "the economy and the stock market feel the strongest at the top". I believe the US economy is in the process of strengthening and is somewhat off from when it will feel very strong. Thus, our algorithms are telling us to remain fully engaged to the upside, that is until the inevitable downturn engulfs the markets once more. At which time, our computers will signal to sell the market. Until then enjoy the ride higher.

Well it's been awhile since we lasted posted to this board. That's because we've been busy developing a new marketing plan for our website http://www.timingcrystal.com.

We're happy to tell you that Membership to TimingCrystal is now Free! You can now gain 24/7 access to our Current Signals and Weekly Updates. So why not tell your friends and come and join our market outperfoming investment strategy today!

Here is an excerpt from our latest Weekly Update:

The Primary Trend for the US stock market indices remains soundly in bullish mode. In addition, investor Sentiment was stronger this week, as the average retail investor is finally giving in to the upward momentum in stocks and returning to the long side of the market. However, long-term interest rates were a thorn in the side of the market this past week as the yield on the 30-year bond climbed close to 5% by Friday' close. This had the net effect of lowering Valuations, thereby casting value investors to the sidelines to wait patiently in cash until another correction engulfs the market. In conclusion, we would not be surprised by some consolidation in large cap stocks, those that make up the S&P 500 Index, next week. However, while there are no guarantees, we believe that the small cap Russell 2000 Index has a chance to begin to reassert itself over the coming weeks as it become more apparent to investors that the US economy is rounding into fine shape. This would be highlighted by increasing economic activity coupled with declining inflationary pressures.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

Weekly TimingCrystal TC Timer Nudges Lower

19-January-2007

Vancouver, Jan 19, (TimerTrac.com Broadcast) – A gauge of current stock market timing weakened in the last week, a stock market timing firm said on Friday.

Teabull Asset Timer Ltd, an independent stock market timing firm, said its TimingCrystal weekly closing TC Timer Index fell to a somewhat bullish level of -18.86 pts in the week ended January 19, 2007 from - 29.32 pts in the prior week. (TC Timer Index stock market timing readings are strongest at high negative levels). TimingCrystal’s TC Timer is made up from a combination of Primary Trend, Sentiment, and Interest Rate and Valuation measures.

“The TC Timer ticked slightly lower but remains in bullish negative (strong) territory. Although the Nasdaq took a hit of over 2% this past week, other more diversified Indices closed relatively unchanged from the previous week's close. 4th quarter S&P 500 Corporate earnings have come in at around 14% so far and continue to surprise to the upside. However, we do note that some firms are revising downward, their 1st quarter 2007 earnings projections, hence the sell-off in some Company's shares after their reports have been released.", said Anthony Waller, President of Teabull Asset Timer Ltd.

The decrease in the strength of the TC Timer was due to a combination of slightly lower Primary Trend and Sentiment readings coupled with marginally higher long-term Interest Rates. These were offset to a very small degree by better Valuation readings. Waller said.

TimingCrystal

Weekly TimingCrystal TC Timer Strengthens

12-January-2007

Vancouver, Jan 12, (TimerTrac.com Broadcast) – A gauge of current stock market timing strengthened in the last week, a stock market timing firm said on Friday.

Teabull Asset Timer Ltd, an independent stock market timing firm, said its TimingCrystal weekly closing TC Timer Index fell to a bullish level of -29.32 pts in the week ended January 12, 2007 from + 20.71 pts in the prior week. (TC Timer Index stock market timing readings are strongest at high negative levels). TimingCrystal’s TC Timer is made up from a combination of Primary Trend, Sentiment, and Interest Rate and Valuation measures.

“The TC Timer strengthened nicely this week and moved back into bullish negative (strong) territory. With the coincident factors of falling energy costs and 4th Quarter Corporate Earning warning season winding down, investors clearly turned their minds to the possibility of an economic "soft landing" and the resulting positive economic factors of such an occurrence", said Anthony Waller, President of Teabull Asset Timer Ltd.

The increase in the strength of the TC Timer was due to a combination of considerably higher Primary Trend and better Sentiment readings. These were offset to a marginal degree by lower Valuation readings and higher long-term Interest Rates, Waller said.

Weekly TimingCrystal TC Timer Continues to Weaken

5-January-2007

Vancouver, Jan 5, (TimerTrac.com Broadcast) – A gauge of current stock market timing fell further in the last week, a stock market timing firm said on Friday.

Teabull Asset Timer Ltd, an independent stock market timing firm, said its TimingCrystal weekly closing TC Timer climbed to a mediocre level of 20.71 pts in the week ended January 5, 2007 from -4.15 pts in the prior week (TC Timer stock market readings are strongest at high negative levels).

TimingCrystal’s TC Timer is made up from a combination of Primary Trend, Sentiment, and Interest Rate and Valuation measures.

“The TC Timer climbed rather strongly this week and moved soundly out of negative (strong) territory. Therefore, at current levels we would interpret the reading to be somewhat more cautious for the broad US Stock Indices heading into the 4th Quarter Corporate Earnings warning season,” said Anthony Waller, President of Teabull Asset Timer Ltd.

The decrease in the strength of the TC Timer was due to a combination of considerably lower Primary Trend and marginally lower Sentiment readings. These were offset to a slight degree by better Valuation readings and marginally lower long-term Interest Rates, Waller said.

http://www.timingcrystal.com

Weekly TimingCrystal TC Timer Weakens

29-December-2006

Vancouver, Dec 29, (TimerTrac.com Broadcast) – A gauge of current market timing fell in the last week, a stock market timing firm said on Friday.

Teabull Asset Timer Ltd, an independent stock market timing firm, said its TimingCrystal weekly closing TC Timer climbed to a level of -4.15 pts in the week ended December 29, 2006 from -14.45 pts in the prior week (TC Timer stock market readings are strongest at high negative levels). TimingCrystal’s TC Timer is made up from a combination of Primary Trend, Sentiment, and Interest Rate and Valuation measures.

“The TC Timer has continued to climb during the past week although its level still remains in negative territory. Therefore, at current levels we would interpret the current reading to be somewhat bullish for the broad US Stock Indices,” said Anthony Waller, President of Teabull Asset Timer Ltd.

The decrease in the strength of the TC Timer was due to a combination of lower Primary Trend, Sentiment, and Valuation readings and higher long-term Interest Rates, Waller said.

To view a chart of how TimingCrystal’s TC Timer interacted with the broad US stock market over the trailing 12 month period please click on the following link:

http://timingcrystal.com/member/stockmarketdec2906.htm

Editorial

The three stock indices we cover continued higher this week with the Nasdaq 100 Index setting the pace with a comfortable 0.47% increase. This increase was slightly outdone by the Russell 2000 Index which garnered 0.48% and to an even greater extent the S&P 500 Index that climbed a steady 0.64%.

- Our Primary Trend Indicator is Bullish.
- Our Sentiment Indicator is Bullish.
- Our Interest Rate Indicator is Bullish.
- Our Valuation Indicator is Bearish.

Our Primary Trend Indicator, as one can imagine, with the sturdy move forward in the S&P 500 Index, remains entrenched in Bullish Mode. Momentum players are surely in this market now and continue to push all the indices higher on any market setback. Friday brought a day of strong profit taking and it will be interesting to see how soon the Bull's will regain the upper hand and push the indices ever higher. This Indicator continues to show marked investor conviction to the upside, even in the face of fear mongering by perennial market gloomsters.

Our Sentiment Indicator finished Friday once more fully engulfed in Bullish Mode. However, with the market sell off on Friday a glimmer of investor unease surfaced. This we would interpret to be good news in order for the stock market to consolidate for a week or two before resuming its uptrend. Therefore, based solely on this Indicator we would not be surprised by a slightly negative tone to trade next week. However, as April showers bring May flowers, the market should resume its uptrend again after this relatively short period of cleansing.

Our Interest Rate Indicator bolted ahead at the end of the week to finish firmly in Bullish Mode by Friday's close. The rally in the bond market was sparked by a drop in residential housing data and was capped off by a lower then expected GDP report for the 3rd quarter. We are very encouraged by the action in the Bond Market and firmly believe that it will provide a strong underpinning to the Stock Market at current levels. We are only slightly concerned that the yield curve has inverted a touch. This is because we believe the US Federal Reserve can and will drop short-term interest rates quickly if the economic slowdown, already at hand, becomes excessive. We will note that the latest Economic Cycle Research Institutes latest report showed their Weekly Leading Indicator's annualized growth rate increased to a negative 0.1% from a negative 0.5% the prior week.

Our Valuation Indicator, although in Bearish Mode, is now situated in much better position then last Friday's close, especially for those looking to invest new capital into the market. However, we would suggest that stocks continue to remain a fairly lofty levels and therefore a program of dollar cost averaging into this market would probably be our best strategy. The current market is prone to swift, pronounced sell offs, like that experienced on Friday. Therefore, we would feel much more comfortable investing on periods of weakness then chasing stocks that are running ahead of themselves. Although we do not know the catalyst, a market correction of a few percentage points can be readily expected after the huge run up in stocks over the prior three month period.

In conclusion, we believe we are now approaching Stock Market levels that, over the short-term, are extended and in need of a slight pullback. This is not to say that we do not continue to remain positive on the medium-term outlook. In fact, with interest rates heading lower we are now more bullish at the end of this week then at the same time last week. Corporate Earnings continue to shine, in fact with 62% of the Companies that make up the S&P 500 Index already having reported, a stellar 74% have beaten profit estimates, 11% have met and just 15% have fallen short of the mark. Furthermore, the average profit growth has increased from 15.30% at the beginning of the quarter to 17.40% by Friday's close. These are not numbers that Bear Markets are easily made of. However, we must be on alert that we are not at the top of the earnings cycle. In fact, already earnings estimates for the 4th quarter have declined to profit growth of 10.70% currently from growth of 12.80% forecast as late as October 1/06.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

Editorial

As we alluded to the possibility last week, the past five days of stock market action were characterized by see saw trading. In fact the Nasdaq 100 Index showed the greatest variance by declining 1.02%. Meanwhile the Russell 2000 Index inched lower by 0.07% and the S&P 500 Index actually climbed a meager 0.22%.
 
- Our Primary Trend Indicator is Bullish.
- Our Sentiment Indicator is Bullish.
- Our Interest Rate Indicator is Neutral.
- Our Valuation Indicator is Bearish.

Our Primary Trend Indicator meandered throughout the week. However, by Friday's close had not changed to any significant degree to last week's finish. In fact, our Primary Trend ended trade on Friday once more engulfed in Bullish Mode. We had anticipated this type of action going into the open of trade on Monday morning. Moreover, one can take comfort that on each attempt by the Bears to push the market lower, the Bulls pushed back with equal intensity throughout the week to thwart off any significant decline.

Our Sentiment Indicator continued most of the week in Bullish Mode and in fact finished there on Friday. However, as was the case last week, our Sentiment Indicator is becoming increasingly overly bullish. This type of behavior is often the precursor to a continuation of a consolidating market or worse yet a warning that a sudden surprise sell off is on the short-term horizon. At this point, we would hazard to guess, that a continuation of the consolidation that we saw this past week to be the more likely outcome. This assertion is based on the fact that we continue to witness relative strength in our Primary Trend Indicator. To wit, this Indicator is showing no signs of deterioration in the current market up-leg.

Our Interest Rate Indicator strengthened a tad this week. However, it continues to vacillate in Neutral Mode, and is showing no overt signs of turning decidedly Bullish over the near-term. However, the US Federal Reserve is set to meet this coming Tuesday and Wednesday to discuss short-term interest rates and issue their much anticipated accompanying Statement. If the Federal Reserve hint that they may have to loosen monetary policy sometime in the first quarter of 2007 the Bond Market should rally strongly. Conversely, and this is what we anticipate, the Federal Reserve may, once again, reaffirm it's primary concern at this point in the business cycle to one that is vigilant against the possibility of rising inflationary pressures. This, we would suggest, would hamper any possible rally in the Bond Market and may in fact cause a short-term decline there.

Our Valuation Indicator closed again this past Friday in Bearish Mode. We are not unhappy with this circumstance as it portrays a stock market with a strong underpinning bid. This is verified by the fact that the S&P 500 Index could only breach the 1360 pt mark on one day during the past five day market stretch. While a Bullish Valuation Mode reading is most often a welcome happenstance for those underinvested in equities, perversely, for those already fully invested, Valuation Indicator readings consistently in Bearish Mode coupled with an Interest Rate Indicator Bullish Mode reading is often a tonic for an outright raging Bull Market.

In conclusion this week, we would anticipate that we should not be surprised by another week of back and filling in the three stock indices we cover. However, if the Federal Reserve surprises and issues a "dovish" stance on short term interest rates, the Bond Market may explode higher, and in turn, pull the stock market up for the ride. Corporate Earnings for the fiscal 3rd quarter continue to pour in and are surprisingly strong. In fact, with about a third of the Company's in S&P 500 Index having already reported their earnings for the quarter, fully 74% have reported above estimates, 16% have matched and just 10% have missed their targets. Moreover, the average earnings year over year growth rate has jumped an impressive 16%. So much for the Bear's low single digit forecast assertions some months ago.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

Editorial

In a joyous sequel to last week's strong stock market action, this week's stock market, at least on the surface, proved more then the most ardent Bear could handle. With the Bulls fully in control, the three major Indices we cover continued to gather strength and march ever higher. In fact, the Nasdaq 100 Index jumped 2.51%. This was even outdone by the Russell 2000 Index that sprang forward 3.09%. And, although lagging a tad, the large cap S&P 500 still garnered another 1.19% to its credit.

- Our Primary Trend Indicator is Bullish.
- Our Sentiment Indicator is Bullish.
- Our Interest Rate Indicator is Neutral.
- Our Valuation Indicator is Bearish.

Our Primary Trend Indicator as one would expect, strengthened throughout the week. Our Primary Trend Indicator measures the stock market's overriding directional trend. In fact, it is not really very useful as a forecasting tool. This is primarily because it is a reactive rather then a proactive Indicator. However, it is still extremely effective in helping us detect in which direction the stock market is trending. Importantly in investing, the trend is your friend. Therefore, we want to be invested as early as possible in the direction that Institutional money is flowing. Currently, this Indictor is suggesting that not only are Institutions buying the market, but, in fact, private investors are beginning to warm up to idea that we may be in the early innings of new bull up leg.

Our Sentiment Indicator is currently situated in Bullish Mode. In fact, it is verging on being overly Bullish. You may ask; if this Indicator is so bullish, why shouldn't the stock market put in another stellar gain next week? The simple answer is that just as the general investing populace becomes convinced that a market is going to either climb to the moon, or conversely, crash into smithereens, the stock market does not oblige and quickly moves in the opposite direction. This is not to say that the current Bullish Trend will not continue. Rather, we would suggest that the market is setting itself up for either a swift, short sell off or an extended period of consolidation.

Our Interest Rate Indicator continued to worsen throughout the week as stronger then anticipated US domestic economic reports were released. However, we would assert that the action in the Bond pits was one that was stimulated by the need for profit taking after some heady gains garnered there over the past two months. We believe this rather then something that foreshadows a more sustained decline in prices and rise in yields. This is underscored by the most recent report issued by the Economic Cycle Research Institute on Friday. The report continued to point to a sluggish US economy going forward. This is welcome news for the bond market and we would suggest that with the US 30-year bond yielding 4.94% a steady bid may come into the debt market to support prices at around current levels. Provided, that the long bond's yield remains below 5.00%, the stock market should continue to offer Asset Allocation managers a solid investing alternative vis-à-vis. the bond market.

Our Valuation Indicator closed Friday, once again, in Bearish Mode. In fact, with the yield on the US 30-year Bond now approaching 5.00% the stock market is beginning to look much more expensive then it was just two weeks ago. However, provided that the debt market can stabilize next week, and stocks either pullback or consolidate around current levels for at least the next week or two, our Valuation Indicator has the chance to move to a more Neutral stance. Conversely, the stock market may continue to inch forward given the strength of our Primary Trend Indicator. If this comes to fruition, it could make the inevitable stock market pullback all the more painful.

In conclusion, you may get the stark impression that we are becoming increasingly uncomfortable with the substantial gains in the US Stock Indices over the course of the past two months. In fact, we are concerned that the pace and magnitude of the recent two month stretch cannot be sustained without a stock market pullback or extended period of consolidation taking place. Of course we would prefer the latter. That is, we would prefer that the stock market moves up and down in a tight range over the next week or two in an effort to eliminate the speculative juices that have been pouring into the market of late. Last week, we asserted that we felt the stock market was transitioning itself from a Value Investor supported market to one that was becoming increasingly driven ever higher by Momentum Investors. We believe this past weeks market action highlighted this possibility. However, these momentum types of markets are historically pronounced with strong pullbacks that are met with a "buy on the dip" mentality from those underinvested in equities.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

http://www.timingcrystal.com

Editorial

It was another week for the bulls on Wall Street in the most recent 5 day market stretch. The Nasdaq 100 Index continued to impress, tagging on an substantial 1.86%. This was even outdone by the once lagging Russell 2000 Index that galloped ahead by 1.96%. And, to a lesser extent this week, the S&P 500 Index marched forward 1.03%


- Our Primary Trend Indicator is Bullish.
- Our Sentiment Indicator is Bullish.
- Our Interest Rate Indicator is Neutral.
- Our Valuation Indicator is Bearish.

Once again our Primary Trend Indicator closed the week entrenched in Bullish Mode. We would interpret the occurrence of this happenstance as mainly the result of the US public being underinvested in US equities. This has the net effect of the market evolving from one that was heavily supported by Value Investors at the market lows in June and July of this year to one that is being rallied by Momentum players i.e., the general US investing populace. If this analysis proves correct, we may well be in the beginning innings of a new bull market up leg.

Our Sentiment Indicator finished Friday situated nicely in Bullish Mode. This Indicator is giving no indication that there is much of any market risk on the short-term horizon. However, this does not mean that stocks can not be taken down from time to time on negative media hysteria that often leads to strong bouts of profit taking.

Our Interest Rate Indicator closed the week on a more shaky footing. Reacting to the Friday US Government Jobs Report, Bond traders decided that the economy was not about to fall off a cliff. In fact, the September 2006 increase in jobs of just 51,000 would normally have sent the debt market rallying. However, upward revisions in the July and August Payroll Reports and a slight drop in the unemployment rate led to concerted profit taking by the Bond gules. We continue to pay close attention to this Indicator, however, currently the 30 year bond, with a yield at 4.84%, still presents a strong underpinning to the stock market.

Our Valuation Indicator finished the week, once again, in Bearish Mode. However, stocks, in general, did become a little bit cheaper on Friday as some mild profit taking took place after the week's solid gains. It should be reemphasized, that the stock market may be in the process of transforming itself into a Momentum market. This can best be illustrated by the recent succession of record highs set by the Dow Jones Industrial Average. Therefore, we will continue to let the Primary Trend override our mild concerns of an overvalued stock market, at least for now.

In conclusion, we continue to be guarded against the possibility of market weakness if 3rd quarter earnings surprise to the downside. However, to date, the stock market has given no indication that this is a high probability. Therefore, we will remain cautiously optimistic that the general public is just now warming up to the fact that Corporate America and the US economy continue to chug along at a healthy clip. In fact, we find it quite remarkable that the Nasdaq 100 Index is still showing a modest loss for those buy and hold advocates since our first live signal of November 18/05. Clearly the general populace is underinvested.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

http://www.timingcrystal.com

Editorial

This week pleasantly surprised us to the upside in the Nasdaq 100, Russell 2000 and S&P 500 Indices. In fact the Nasdaq 100 Index jumped 1.96%, the Russell 2000, while lagging a smidge; trod forward 0.97% and the S&P 500 outdid this, moving up a solid 1.60%.


Our Primary Trend Indicator is Bullish.
Our Sentiment Indicator is Neutral.
Our Interest Rate Indicator is Bullish.
Our Valuation Indicator is Bearish.

Our Primary Trend Indicator finished Friday solidly in Bullish Mode. In fact, this Indicator is situated in very good position. By this we mean that it is not overly Bullish, where a significant market top can occur. This is not to guarantee that the market can't move down from current levels, only that the likelihood of such an occurrence is weakened. It is interesting to note that institutional money seems to streaming into the large cap sector, in particular. This is evidenced by the relative out performance of the S&P 500 when compared to the Russell 2000, which had been the year 2005's best performing Index, at least to the long side.

Our Sentiment Indicator continues to vacillate between Neutral and outright Bullish Mode. This Indicator finished Friday in a cautionary Neutral stance. We would interpret this as somewhat Bullish, as the market needs, at least a semblance of risk aversion from the majority of market players, to continue to move stocks higher in the weeks ahead.

Our Interest Rate Indicator remains firmly entrenched in Bullish Mode. With the yield on the US 30-year Government Bond still hovering around 4.75%, the US residential housing market has at least the opportunity to stabilize over the coming weeks. Low interest rates are also a boon for Corporate America, particularly the Telecom sector, which is highly sensitive to moves in the debt market. We note, that the prices paid component released in the Chicago Purchasing Managers Index ticked lower. This is welcome news as moderating inflationary pressures help to ensure interest rates do not ratchet up to levels that would choke off the broad US economy.

Our Valuation Indicator closed Friday in Bearish Mode. Based solely on this Indicator we would expect the stock market to at least consolidate its heady gains of late over the short-term. In fact, some market back and filling would be welcome news in order to work off more of the short term optimism that has gently re-entered the market. However, we must be cognizant of the fact that this Indicator must continually be analyzed in conjunction with the relative position of our Interest Rate Indicator. Therefore, we would assert that the stock market still offers a competitive investment alternative to the bond market.

In conclusion, we would caution investors that 3rd quarter Corporate Earnings warning season should enter into full force next week. This could well have the net effect of leaving equities struggling to build on this past week's stellar gains. Conversely, with each passing day that a significant earnings warning is absent, Institutional investors may well continue to gather confidence that Corporate Earnings can approach double digit figures for yet another quarter. We note that the Dow Jones Industrial average continues to flirt with an all time high. We would suggest that a convincing break through the 11,725 pt mark in this Index will only come with a correspondingly convincing positive 3rd quarter Corporate Earnings season. Should the general market get early, reinforcing, strong Corporate Earnings, coupled with a continued moderation in inflationary pressures, October may well follow on September's footsteps and produce solid gains in the three Stock Indices we cover.

We wish you continued good luck with your investments next week.

Sincerely,

The TimingCrystal Team

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