A Complacent Market

The upward move at the end of last week broke through the small downtrend line we were watching, but then acted poorly as the averages approached and exceeded the September highs (and only in the Dow Jones Industrial Average). The refusal of those highs since then reinforces my thought that the Federal Reserve's recent quantitative easing action put a cap on the market, rather than boost it. We now have a formidable series of highs, as can be seen on the first chart. With the Arms Index becoming overbought on a short-term basis again, a penetration of that level looks doubtful.

The second chart emphasizes an extremely complacent market. Ironically, the public tends to be the most complacent at just the wrong time. The Volatility Index (VIX) dropped below 14 again Friday, which has been a reliable sign of a short-term top....230 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

Read the full story and get access to the Real Money Pro trading floor.

There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.

Already a Subscriber? Please login.

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.