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As I’m going through all my charts the stock market just looks toppier and toppier. For the whole month of February we’ve been seeing interesting divergences. While US stocks have kept climbing, foreign stocks and the euro have been declining. Commodities lead by Dr. Copper have fallen, as well. Today the Dow Industrials, the least diversified of all the major indexes, made a new high but the Russell 2000 (small caps) and other recent leaders like the homebuilders never came close. The Dow ended up reversing and closing lower on the day. All in all the rally of the past few days feels like it’s been driven by suckers.

I don’t think most folks are aware of the fact that stocks are up over 40% in just 16 months. It’s been a great run and I’ve been fortunate enough to be bullish for that span. During this time we had an incumbent president running for reelection, an unusually accommodative Fed, an economy in recovery from one of the deepest recessions in history, a rebounding housing market, skeptical investors and historically low equity valuations all providing a stiff tailwind for risk assets. What’s to make them go higher from here? Certainly the odds today for higher stock prices 16 months from now are not nearly as great as they were 16 months ago.

I was intrigued today by an interesting new indicator Mark Hulbert calls the “Greedometer” which is flashing a warning that has only flashed this bright during the Spring of 2011, the Summer of 2007 and the Spring of 2000. The indicator is made up of a variety of indexes like the VIX and the Weekly Leading [Economic] Index and is intended to signal a crash. Clearly, in 2000 and 2007 it was damn accurate. The selloff during the summer of 2011 can’t really be called a crash even if it did result in a 20%+ loss over a couple of months. Still, the indicator suggests greed greatly outweighs fear in the market right now and we all know what Warren Buffett advises about those two emotions. I, for one, am getting fearful.