The FIFTI¹ Index is a measure based on fifty opinions of independent investment advisors with free newsletters and web site market forecasts. FIFTI is the acronym for Free Information From The Internet. It is one of the tools that www.investorsinternet.com uses to gauge the stock market's direction for its Members and Subscribers. Because the opinions are not those of financial professionals who may have a vested interest in being optimistic about the market rising, the FIFTI Index is more reactive to changes in the market place than many other surveys.

This past weekend more of the independent investment advisors are looking past the end of the year and are expressing their opinions about January and the first quarter next year. Of course, the arguments that support a Santa Claus rally do not apply. As a result many more bearish opinions are being expressed than in the last few weeks.

This past weekend the bulls are still in the majority for the short and medium term. The FIFTI Index is showing 58% bulls in the short term and 61% in the medium term, in contrast to 18% bears for both timeframes. The previous week the percentages for the bulls were 87% and 85%. This week's medium term figure for the bulls is still influenced to some extent by the expected market rise into the year end, else it would be a lower percentage.

Over the last few weeks the bears have been almost silenced by the conviction that the market will be higher at the year end. Many predicted a pullback before the final run to new highs, but hardly anyone opined that the market would go down for any length of time this year.

There is a good deal of uncertainty about a pullback. The down days last week were not as much of a pullback as some thought was needed to set up a strong run to the year end. Hence there is a doubt whether the pullback is finished, whether it will simply be a consolidation at current levels or whether it has yet to happen.

Many of the experts do not see the market going far above the recent highs, partly because of the shallow pullback, and partly because the base from which the rally started was not solid enough to support a major bull run. Expectations are for the Dow to exceed 11,000 but not by that much.

Concerns expressed about the market include excessive bullish sentiment, the overbought condition, an unfavorable risk/reward ratio due to its proximity to major resistance, the Commitment of Traders report for stock index futures, the lack of response to last week's good economic news, the rise in gold, the flattening yield curve, and, of course, the action of the Federal Reserve related to interest rates.

Rising markets are said to climb a wall of worry, and while there are plenty of investors worrying, the markets are still climbing, and probably will until the year end at least.

¹ The FIFTI Index is based on Free Information From The Internet, and in particular, on advice provided by fifty independent newsletter and Web site writers selected from the book "The Investor's Free Internet".