MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 1 Flow of Funds: Net Change in Supply of Stock Index $Billions Quarterly, SAAR S&P 500

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 2 Flow of Funds: Households Equity Percent Total Financial Assets Percent S&P $Billions

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 3 Flow of Funds: State & Local Government Employee Retirement Funds S&P 500 Equity Percent Total Financial Assets Percent $Billions

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 4 Net Purchases of U.S. Equities by Foreign Investors minus Net Purchases of Foreign Equities by U.S. Investors $Billions Index S&P 500 Quarterly net flows

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 5 Net Purchases of U.S. Equities by Foreign Investors $Billions Index S&P 500 Quarterly net purchases

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 6 Net Purchases of Foreign Equities by U.S. Investors $Billions Index S&P 500 Quarterly net purchases

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved Monthly $Billions New Equity Financing 12-Month Total $Billions

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 8 Secondary Distributions: Value $Millions Index 52-Week Moving Average S&P 500

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 9 Margin Debt versus % of Market Value % of Market Value Margin Debt Prior to January 1997, NYSE figures only $Billions

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 10 Insider Activity Index S&P 500 Bearish 8-Week Moving Average Bullish

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 11 Equity Mutual Funds: Cash Percentage of Net Assets Percent Index S&P 500 Cash Percentage (Monthly)

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 12 Sales (Including Reinvested Dividends) and Redemptions of Equity Mutual Funds Sales Redemptions $Billions S&P 500 Index

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 13 S&P 500 Net Sales (Monthly) Net Sales of Equity Mutual Funds (Including Reinvested Dividends) $Billions Index

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 14 Net Exchanges into Equity Mutual Funds Dec 86 Dec 88 Dec 90 Dec 92 Dec 94 Dec 96 Dec 98 Dec 00 Dec 02 Dec 04 Dec 06 Dec $Billions Index Net Exchanges (monthly) S&P 500

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 15 Equity Mutual Funds: Total Flows (including ETFs as of Jan. 2008) $Billions Index Data change as of January 2008 Total Flows (Monthly) S&P 500

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 16 Equity Mutual Funds: Net Purchases of Common Stock $Billions Index Net Purchases (Monthly) S&P 500

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 17 S&P 500 Dividend Yield vs. Price / Earnings Ratio Dividend Yield P/E Ratio RatioPercent P/E Ratio October 2009

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 18 ISE 10-Day Put/Call Ratio Index Ratio S&P Day Ratio

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 19 Options Clearing Corp. (OCC) Equity Options Premium Put/Call Ratio 4-Week Moving Average Bullish S&P 500 Bearish Index Ratio

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 20 Options Clearing Corp. (OCC) Index Options Premium Put/Call Ratio 4-Wk. Moving Average S&P 500 Bearish Bullish Index Ratio

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 21 Consensus Inc. Bullish Percentage: Equities Bearish S&P 500 Bullish 4-Week Moving Average Index Percent

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 22 Bulls as a % of Bulls + Bears from Investor’s Intelligence Index Bearish S&P 500 Bullish 4-Week Moving Average Percent

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 23 Bulls as a % of Bulls + Bears from the American Association of Individual Investors (AAII) Index Bearish 4-Week Moving Average Bullish S&P Percent

MTA Educational Foundation University Course – Technical Analysis of the Financial Markets ©2010 Lecture 10 - Sentiment & Supply/Demand This lecture series is produced by the Market Technicians Association Educational Foundation based on the detailed class notes of Charles D. Kirkpatrick II, CMT Copyright © All rights are reserved. 24 NYSE Total Short Interest vs. Short Interest Ratio Percent Billions of Shares Short Interest Ratio Total Short Interest