Blog

Jun 27

Interim Report

The market to decline with another bad day.  Two of our ETFs hit their trailing stops today:

 

XLi $52.93

SMH $54.45

We continue to hold XLB, VNQ, and XLP with their stops in place.

Jun 26

This will be a shortened blog post as is the case every other week.

Market Review

COMP June 24 2016The stock market was doing fine with a big advance on Thursday, but after the Brexit vote turned out to be the reverse of what had been expected,  world markets took a beating on Friday with US markets tumbling about 3.5%.  If someone had one been on vacation for the week and not checked the news and just looked at the market’s weekly results on Friday, one would not have known there was any  important news last week.

For the week, the DJIA was down 1.55%, the S&P 500 down 1.63%, and the NASDAQ down 1.92%. All fell a bit more than the week before, not a big deal.

On Friday alone, the NASDAQ Composite fell below its 50-, 100-, and 200-dmas simultaneously, a rare occurrence.  This resulted in a SELL signal on Indicator #2.  Moreover, Indicator #8 registered a SELL signal on Juine 20, as the MACD crossed over to the downside confirming the Index crossing below the 5-day ema.  Therefore, the BDH Dashboard is on a “1” SELL signal as of the close on Friday.

Dashboard-V2-June 24 ,2016_WC-1-1

NASI June 24 2016The BDH portfolio did not register any 7% trailing stop sell signals on Friday.  Below is the trailing stop price for each of the ETFs:

Trailing stop                  Friday’s low price

XLI $52.93                      $54.23

SMH $54.45                      55.13

XLB $44.97                       45.90

VNQ $80.00                      83.54

XLP $50.35                       52.88

Last week there were 391 new 52-week highs on the NYSE, compared to 270 the week before.  New lows totaled 73 compared to 83 a week earlier.  The percentage of stocks above their 50-dma  plummeted to 43.16% from 56.3% a week earlier, and those above their 200-dma fell to 61.8% from 67.5% a week earlier.

Conclusion  —  Market in Short-Term downtrend

Although there is a Dashboard SELL signal in place, I do not recommend selling out the ETF portfolio.  My logic is not to emotionally respond to a big down day caused by a major world event.   If the US stock market declines further, then the 7% trailing stops will be hit.  If not, then we will continue to hold looking toward a possible rebound higher.  The events of last week were unusual causing an upswing in fear, resulting in selling world-wide.  Smart investors do not panic and certainly do not sell on a day like Friday.  History clearly demonstrates that these type of days usually turn out to be major buying opportunities.

Be careful and be smart!

Remember that you are responsible for your investments and how you manage them.   If you decide to follow the BDH strategy, then you are responsible for checking the BDH indicators daily during times when the market is volatile.  Just bookmark the two charts above and look for any signal changes.  I may not available during the week to provide interim Dashboard signal changes. It is important to be pro-active so as not to miss any Dashboard signals. Decide on and place your stop LIMITS that meet your risk profile.

Jun 18

Market ReviewCOMP June 17 2016

This week past week the market experienced weak closes indicating lack of bullishness.  This could be the result of many market variables, but we will continue to follow the BDH strategy and ignore all the noise caused by domestic and foreign events and the presidential candidates.  Indicator #2 issued a SELL signal on June 13 and the DASHBOARD is on a “3” BUY signal.

The market was unable to maintain its upward bias after decisively breaking out of its two week trading range near May 23.  The NASDAQ Composite has declined six of the last seven trading days. Also, on June 13 the MACD crossed to the downside issuing a SELL signal on Indicator #5.  Moreover, both the  50-dma and the 200-dma were penetrated to the downside this week (See chart to the right).  This is a negative sign going forward, as this index typically leads the other major averages in both directions.  So far, the DJIA and S&P 500 have not followed suit and remained above those two key moving averages.

For the week, the S&P 500 lost 1.19% followed by the DJIA which lost 1.06%.  The NASDAQ came in last down 1.92%.

Year-to-date, the NASDAQ is down 4.14% while  the S&P is up 1.33% and DJIA up 1.44%.  The BDH strategy is up a respectable 1.31% with most of the money safe in cash for many days during the year. There were only 270 new 52-week NYSE highs this past week compared to 513 two weeks ago, thus indicating a weakening market.

The percentage of NYSE stocks above their 50-dmas plummeted to 56.30%. This number is now well below the excessively elevated levels at near 90% in April. The percentage of stocks above their longer-term 200-dma declined this week to 67.47% which is about 9 .00 percentage points shy of its April high.  Believe it or not. this percentage fell to 15.50% in January 2016.  So the market has come a long way back in a short time, but has given back some of its gain.

Bond prices continued to surge and closed on Friday just below for their highs for the year hit the day before.   Gold (GLD) prices and gold miners (GDX) had a volatile week closing mostly higher. Oil prices closed lower after hitting the highs for the year seven days earlier.  In the above chart, please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current bond weekly performance, or GLD, GDX and USO and $BRENT for the other averages.

Indicator Review One Negative Change NASI June 17 2016

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator issued a BUY signal on March 29, 2016 (see first chart).

Indicator #5 NASDAQ Composite with MACD.  This indicator issued a MACD SELL signal on June 13th,  (refer to first chart MACD indicator).

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 15th 2016 Bullish Percentage reading was 25.3% which was down 2.5 percentage points from two weeks earlier.  This indicator remains on its long term buy signal with numerous confirmations along the way.  Moreover, the readings the past few weeks have been among the lowest on record.  This bodes well for the market, as this as sentiment is a contrary indicator.  The lower the bullish percentage the more likely the market is to reverse direction and move higher.

Indicator #8 NASI Summation Index and MACD. This indicator issued a SELL signal on April 8 as the Index crossed to the downside over the 5 day-ema confirming the prior MACD SELL signal.  However, on June 13 the 5-dma had a negative crossover of the index (see second chart), and the MACD is also nearing a crossover (red circled area).  If this crossover occurs this week, then this indicator will be on a SELL signal and the Dashboard will be on a “2” NEUTRAL reading.

Here is a chart showing all Dashboard buy and sell signals (it may take a day or two for the new signal to be posted):
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893

Dashboard Now on “3” BUY Signal

Here is the latest:

Dashboard-V2-June 17 ,2016_WC-1-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance.  Thus, BDH strategy is ahead of the three major averages year-to-date. It is in 9th place out of 18 strategies followed by the website.  See the “Strategies Summary” link on the top of their page.

Top 5 ETFs –   100% Invested

The portfolio is still 100% invested.

Top-5-ETF-June 17, 2016

The  ETF portfolio has gained 1.89 % since the May 24the BUY signal compared to a loss of 1.28% for the major averages.   So far so good.

Decision Page

Here is the link to the Decision Page:  http://www.etfscreen.com/buydonthold/bdh-decision-page.php

Twelve ETFs have “fail” rating.  All the ETFs in our portfolio have “fail” ratings, but we will wait for a Dashboard SELL signal or a stop being hit to exit the positions.

To get a feel where the best performing ETFs are by asset class, I suggest that you pull up the seven asset classes on the right side of the Decision Page (in blue ink) to see which ETFs have been doing the best — e.g., sector ETFs.  You can click on the down arrow in the three month and one month columns of the each grouping to see short-term performance.  You will note the strong performance of metals,  utilities and fixed income ETFs.

Conclusion  —  Market in Short-Term downtrend

The market approached its April 2016 highs in early June, but the rally has faded in the last seven trading days.  With a 100% invested position, it is prudent to make sure appropriate stops in place.  I have been using 7% trailing stops since the May 24th BUY signal.

Have an enjoyable and restful Father’s Day weekend!

Remember that you are responsible for your investments and how you manage them.   If you decide to follow the BDH strategy, then you are responsible for checking the BDH indicators daily during times when the market is volatile.  Just bookmark the two charts above and look for any signal changes.  I may not available during the week to provide interim Dashboard signal changes. It is important to be pro-active so as not to miss any Dashboard signals. Decide on and place your stop LIMITS that meet your risk profile.

Jun 11

This will be another shortened blog, as is the market made little progress last week and there were no changes in the Indicators or ETFs held.

Market Situation COMP June 10 2016

The stock market was going gangbusters through Wednesday with the S&P 500 back above 2100, the DJIA above 18000 and the NASDAQ Composite nearing 5000.  However, a the two-day decline starting on Thursday changed the market tone.  Thus, the recent uptrend may be in jeopardy.  On Friday 84% of the volume was on down stocks on the NYSE and NASDAQ Composite — not a good sign.  Also ending the week on a solid decline is not positive.

The DJIA gained 0.33%, but the S&P 500 fell 0.15% and the NASDAQ Composite dropped 0.97%   The BDH Dashboard remains on its maximum “4” BUY signal and we’re are 100% invested in ETFs.  We will sell ETFs if our trailing stops are hit or if a Dashboard SELL signal is given, whichever occurs first.  The Dashboard remains unchanged from June 3:

Dashboard-V2-June 3 ,2016_WC-1-1

Note on the accompanying chart that the recent decline in the NASDAQ is marked by red circles.  The MACD is heading downward and a further decline this week could result in a negative crossover.  Hopefully, the NASDAQ will stay above its 50- and 200-dmas or we will be moving lower, perhaps back to the May lows.  Gold and bond prices were higher last week, as uncertainty and world news negatively impacted the markets.

Indicator #6’s  (AAII Weekly Investor Sentiment Survey Bullish Percentage)  reading fell to 27.8% from  30.2% the previous week, still positive.

Year-to-date the BDH strategy is up 2.16% compared to +2.53% for the DJIA, +2.55% for the S&P 500, and -2.25% for the NASDAQ.  The number of new 52-week highs on the NYSE jumped again to 513 from 368 from the prior week.

Have a good week ahead!!

Jun 04

This will be a shortened blog, as is the case most every other week.

Market Situation NASI June 3 2016

The stock closed the holiday shortened week with barely a pulse, as the DJIA fell 0.37%, the S&P 500 was unchanged and the NASDAQ Composite rose 0.18%.  However, Indicator #8 issued a BUY signal as the MACD crossed to the upside on June 1 confirming the May 25 5-day ema index crossover (see accompanying chart).  Thus, the BDH Dashboard is on a maximum “4” BUY signal.  Since we are 100% invested in ETFs we will stay long as the uptrend continues.  We will sell ETFs if our stops are hit or if a Dashboard SELL signal is given whichever occurs first.

Dashboard-V2-June 3 ,2016_WC-1-1

Interestingly, Indicator #6 had another confirming BUY signal as the AAII Weekly Investor Sentiment Survey Bullish Percentage reading of 30.2% on June 1 was up an amazing 12.4 percentage points from the May 25 reading, thereby surpassing the critical 25% threshold to the upside.

Year-to-date the BDH strategy is up 1.86% compared to +2.19% for the DJIA, +2.70% for the S&P 500, and -1.30% for the NASDAQ.  The number of new 52-week highs on the NYSE jumped to 368 from 241 the prior week.  So the market is consolidating its gains.  A move above 2130 on the S&P 500 (now at 2099) and above 5000 on the NASDAQ (4943) will indicate that the market is most likely breaking through to higher levels.

Have a good week ahead!

May 28

Market ReviewCOMP may 27 2016

This week the market managed to break out of two-week trading range, experience a golden cross ( 50-dma crossing over 200-dma on NASDAQ ON 5/24), and issue a BUY signal at the close on May 24.  All in all a solid week after lackluster results over the past year.

The NASDAQ Composite easily surpassed its 200-dma resistance level (see nearby chart) and is approaching the previous highs April.  A big resistance area lies above at 5000.  But closing at 4933.50 for the week with a gain of 3.44% puts the index just 66.51 points away from crossing the 5000 level.  The S&P 500 gained 2.28% for the week, followed by the DJIA which rose 2.13%.

Year-to-date, the NASDAQ is down 1.48% while  the S&P is up 2.70% and DJIA up 2.13%.  The BDH strategy is up a respectable 0.96% with most of the money safe in cash for many days during the year.

There were only 241 new 52-week NYSE highs this past week compared to 277 two weeks ago, and 50 new lows,compared to 76  two weeks ago.  The percentage of NYSE stocks above their 50-dmas has increased to 67.87% from a low of 46.00% a few weeks ago. This number is now well below the excessively elevated levels at near 90% in April. The percentage of stocks above their longer-term 200-dma advanced this week to 70.27% which is 0.73 percentage points shy of its April high.  Believe it or not. this percentage fell to 15.50% in January 2016.  So the market has come a long way back in a short time.

Bond prices were flat and have been in a tight trading range over the past eight sessions. Gold (GLD) prices and gold miners (GDX) fell. Oil prices surged to their highest levels since early January.  In the above chart, please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current bond weekly performance, or GLD, GDX and USO and $BRENT for the other averages.

Indicator Review – One Positive ChangeNASI May 27 2016

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator issued a BUY signal on March 29, 2016 (see first chart).

Indicator #5 NASDAQ Composite with MACD This indicator issued a MACD BUY signal on May 24th,  (refer to first chart MACD indicator).

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest May 25 2016 Bullish Percentage reading was 17.8% which was down 1.6 percentage points from two weeks earlier.  This indicator remains on its long term buy signal with numerous confirmations along the way.  Moreover, the readings the past few weeks have been among the lowest on record.  This bodes well for the market, as this as sentiment is a contrary indicator.  The lower the bullish percentage the more likely the market is to reverse direction and move higher.

Indicator #8 NASI Summation Index and MACD. This indicator issued a SELL signal on April 8 as the Index crossed to the downside over the 5 day-ema confirming the prior MACD SELL signal.  However, on May 25 the 5-dma had a positive crossover of the index (see second chart), and the MACD is also nearing a crossover (green circled area).  If this crpssover occurs this week, then this indicator will be on a BUY signal and the Dashboard will be at maximum “4” BUY reading.

Here is a chart showing all Dashboard buy and sell signals (it may take a day or two for the new signal to be posted):
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893

Dashboard Now on “3” BUY Signal

Here is the latest:

Dashboard-V2-May 27 ,2016_WC-1-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance.  Thus, BDH strategy is slightly behind the DJIA and S&P 500 so far this year and ahead of the NASDAQ, but having been invested for a much smaller period.  So on a risk-adjusted basis the BDH strategy is outperforming the market. It is in 10th place out of 18 strategies followed by the website.  See the “Strategies Summary” link on the top of their page.

Top 5 ETFs –   100% Invested

The portfolio is now 100% invested.  On May 25, at the close, positions were taken in four ETFs.  5% of the XLI ETF was sold.  Now all five ETFs have a 20% position This past week 20 ETFs had pass ratings compared to two two weeks ago.  So the market is rebounding.

Top-5-ETF-May 27, 2016

The  ETF portfolio has gained 1.58 % since the May 24the BUY signal compared to 0.44% for the major averages.   So far so good.

Decision Page

Here is the link to the Decision Page:  http://www.etfscreen.com/buydonthold/bdh-decision-page.php

Thirty-two ETFs have “fail” ratings including four out of five in our ETF portfolio.  This will change for the better as the market moves higher.

To get a feel where the best performing ETFs are by asset class, I suggest that you pull up the seven asset classes on the right side of the Decision Page (in blue ink) to see which ETFs have been doing the best — e.g., sector ETFs.  You can click on the down arrow in the three month and one month columns of the each grouping to see short-term performance.  You will note the strong performance of metals,  and a few sector funds, plus GDX and SLV in Commodities.

Conclusion  —  Short-Term Market Uptrend In Place

The market has finally awoken and broke through some important technical levels this past week.  With a 100% invested position, it is prudent to put in appropriate stops.  I will be using 7% stops going forward and may adjust that level as conditions change.

Have an enjoyable and restful holiday weekend!

Remember that you are responsible for your investments and how you manage them.   If you decide to follow the BDH strategy, then you are responsible for checking the BDH indicators daily during times when the market is volatile.  Just bookmark the two charts above and look for any signal changes.  I may not available during the week to provide interim Dashboard signal changes. It is important to be pro-active so as not to miss any Dashboard signals. Decide on and place your stop LIMITS that meet your risk profile.

May 24

COMP May 24, 2016

Market Situation — Interim Update

Today, the market took off to the races.  This resulted in the NASDAQ Composite easily blasting through its 200-dma with gusto, and Indicator #5’s MACD crossing over to the upside for a BUY signal.  Although the vast majority of ETFs have a fail rating, it is prudent to buy now with the market finally breaking through the trading range to the upside (see green box on chart).  As long as the NASDAQ closes above its 200-dma tomorrow, the BDH strategy will be add a 2o% position in XLP, VNQ, XLB and SMH tomorrow at their closing prices, not their open price as the market may give back some of the gain after the open.  We will reduce the percentage in XLI to 20% from 25% by selling a portion at the close as well.  Thus, we will have an ETF portfolio with five ETFs at 20% positions as is our standard situation.  A 5% trailiong stop will be placed after the buys have been made.

For those conservative investors who do not want to take any new positions until the investible ETFs have a ‘pass’ rating that is their prerogative.

Remember that you are responsible for your investments and how you manage them.   If you decide to follow the BDH strategy, then you are responsible for checking the BDH indicators daily during times when the market is volatile.  Just bookmark the two charts above and look for any signal changes.  I may not available during the week to provide interim Dashboard signal changes. It is important to be pro-active so as not to miss any Dashboard signals. Decide on and place your stop LIMITS that meet your risk profile.

May 21

Market Review — This will be another shortened blog as is the market situation has not changed muchCOMP May 20 2016

This week the markets struggled to make progress.  However,  the NASDAQ Composite finally rose 1.10% after four weeks of losses.  On Monday and Friday the market advanced nicely, but that sandwiched in the three declines mid-week.  The DJIA fell 0.20% for the week and the S&P 500 rose 0.28%

The NASDAQ Composite fell below its 100-dma (Indicator #2) on May 13  (see chart), but quickly reversed higher the next trading day (May 16).  So the Dashboard is still NEUTRAL:

Dashboard-V2-May 20 ,2016_WC-1-1

As the chart shows, the NASDAQ is in a trading range between the 100- and 200-dmas.  A breakout either way will determine the market direction going forward.  The MACD will experience a positive crossover to the upside if the market moves higher this week, thus generating a new BDH BUY signal. Still below its 200-dma, the NASDAQ is struggling to stay above its 100-dma   A big resistance area also lies above at 5000.

Year-to-date, the NASDAQ Composite is down 4.75% compared to a gain of only 0.41% for the S&P 500, and a gain of only 0.44% for the DJIA.  The BDH strategy is up 0.33% year-to-date.  The number of new 52-week highs fell to 277 from 445 the prior week.

The number of NYSE stocks above their 50-dmas has taken a big drop to 46.0% during this past week from a 69.32% two weeks ago, but managed to settle at 52.47% by Friday’s close, so maybe the short-term bottom has been reached.  The percentage of stocks above their longer-term 200-dma advanced rose this week to 62.92% compared to 59.82% a few weeks ago.  This is a positive sign.

Top 5 ETFs –   Stay 75% in Cash Until Next Buy Signal

The portfolio is still 75% invested in cash.   The only remaining position is XLI up 4.92% since its purchase.  This past week only 2 ETFs had pass ratings compared to 10 the prior week.  So the market may have hit bottom here as there is an extreme number of “fails:  50 out of 52!

We are still keeping XLI in the portfolio with a trailing stop in place, even though it has a “fail” rating and a ranking of 23.  The rationale is that the NASDAQ Composite has exceed its 100-dma and possibly moving higher from here.  If not we still have the 5% trailing stop at $54.32 which is nearby its closing price of $55.03 on Friday.

Conclusion  —  Caution is Still Urged — Market Now in Trading Range from Four-Week Downtrend

The market stabilized last week with a strong close on Friday. Because of the market’s technically oversold condition, the market may mark time (as it has this past week) or slowly move higher.  I will provide an interim post during the week if there is a BDH Dashbaord BUY signal.  Make sure you check the charts yourself to look for the MACD crossover on the chart.

Enjoy the week ahead.

May 14

Market Review — This will be a shortened blog as is the case every other week.COMp May 13, 2016

This week the markets struggled to make progress with the NASDAQ Composite continuing its decline of the last few weeks.  On Monday, the market started off with a solid rally but gave it all back and more by week’s end with major averages declining 0.39% (NASDAQ) to 1.16% (DJIA).

The NASDAQ Composite fell below its 100-dma (Indicator #2) on Friday (see chart) by 2.32 points resulting in a SELL signal on this Indicator, as well as a “1” SELL signal on the BDH Dashboard. 

Still below its 200-dma, the NASDAQ is struggling to get above that level (red line on chart) as well as the 50-dma (blue line).    A big resistance area also lies above at 5000.

Year-to-date, the NASDAQ Composite is down 5.79% compared to a gain of only 0.13% for the S&P 500, and a gain of only 0.63% for the DJIA.  The BDH strategy is up 0.34%.

There were 445 new 52-week NYSE highs compared to 365 the prior week, and 80 new lows,compared to 64.  The number of NYSE stocks above their 50-dmas has taken a big drop to 56.11% this week from a 69.32% two weeks ago..  This number is coming down from excessively elevated levels. The percentage of stocks above their longer-term 200-dma advanced fell this week to 59.82% compared to 71% a few weeks ago.  Thus, the market decline in the past few weeks has brought the market down to earth from the high readings reached after the significant 2.5 month advance off the February 11 lows.

Top 5 ETFs –   Stay 75% in Cash

The portfolio is still 75% invested in cash.   The only remaining position is XLI up 4.96% since its purchase.  This past week only 10 ETFs had pass ratings compared to 6 last week.  So the market decline had resulted in numerous ETFs experiencing negative MACD crossovers which one of the ‘fail’ criteria.

Although the Dashboard has issued a SELL signal on Friday, we are still keeping XLI in the portfolio with a trailing stop in place.  The rationale is that the NASDAQ Composite only needs to rise about 3 points for it to exceed its 100-dma which would result in another Dashboard NEUTRAL signal.

Conclusion  —  Caution is Still Urged — Market Now in Short-term Down Trend

The market has declined for the last three weeks. We’ll maintain the 5% trailing stop at $54.32 on XLI  to protect against a further market decline.

Because of the market’s technically oversold condition, the market may mark time or slowly move higher.  However, neither of those conditions may occur and the market may continue to decline further.

Enjoy the week ahead.

May 08

Market ReviewCOMP May 6 2016

This week the markets struggled to make progress with the NASDAQ Composite continuing its decline of the prior week.  This week Monday and Friday were up days and the other days were down days. The NASDAQ Composite fell below its 100-dma (Indicator #2) on Wednesday resulting in a SELL signal on this Indicator and a “1” SELL signal on the BDH Dashboard.  However, by Friday the index rallied above the 100-dma just barely reversing the signal to BUY and the BDH Dashboard back to a “2” NEUTRAL reading.  This indicator needs to be watched to see if there a definitive signal either way instead of  fluctuating around it (see green around in chart).

Still below its 200dma, the NASDAQ is struggling to get above that level (red line on chart) as well as the 50-dma (blue line).    A big resistance area lies above at 5000.  With the weak NASDAQ performance the BDH ETF portfolio remains 25% invested in XLI and 75% in cash.

Since the February 29 BDH BUY signal,the three major averages have advanced 5.20%  while the BDH portfolio is up only 1.76%.  That is to be expected with only 50% of the money invested initially and only 25% at present.

Last week the NASDAQ Composite was down 0.82% compared to -0.40% for the S&P 500, and -0.19% for the DJIA.  Year-to-date, the NASDAQ Composite is down 5.42% compared to a gain of 0.65% for the S&P 500, and a gain of 1.81% for the DJIA.  The BDH strategy is up 0.62%.

There were 365 new 52-week NYSE highs compared to 270 the prior week, and 64 new lows,compared to 25.  The number of NYSE stocks above their 50-dmas has taken a big drop to 69.32% this week from a 86% two weeks ago..  This number is coming down from excessively elevated levels. The percentage of stocks above their longer-term 200-dma advanced fell this week to 62.43% compared to 71% a few weeks ago.  Thus, the market decline in the past few weeks has brought the market down to earth from the high readings reached after the significant 2.5 month advance off the February 11 lows.

Bond prices advanced nicely and making it two weeks in a row of advancing prices. Gold (GLD) prices and gold miners (GDX) backed off slightly from their yearly highs. Oil prices took a breather and fell this week.  In the above chart, please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current bond weekly performance, or GLD, GDX and USO and $BRENT for the other averages.

Indicator Review – No  Change By Week’s End NASI May 6 2016

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator issued a SELL signal on April 4, 2016, and then a BUY signal on May 6. (see first chart).

Indicator #5 NASDAQ Composite with MACD.  This indicator issued a MACD SELL signal on April 21,  (refer to first chart MACD indicator).

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest May 4, 2016 Bullish Percentage reading was 22.3% which was down five percentage points from two weeks earlier.  This indicator has now dropped below the critical 25% level.  A rise above this level in subsequent weeks would another confirming BUY signal.

Indicator #8 NASI Summation Index and MACD. This indicator issued a SELL signal on April 8 as the Index crossed to the downside over the 5 day-ema confirming the prior MACD SELL signal.

Here is a chart showing all Dashboard buy and sell signals (it may take a day or two for the new signal to be posted):
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893

Dashboard Still on “2” NEUTRAL Signal

Two changes over past few weeks in Dashboard signal.

Dashboard-V2-May 6 ,2016_WC-1-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. For 2016, the BDH portfolio is up 0.62% compared to the S&P 500 and DJIA both up around 1.2%, although the NASDAQ Composite is down 5.42% so far.  Thus, BDH strategy is slightly behind the DJIA and S&P 500 so far this year and ahead of the NASDAQ, but having been invested for a much smaller period and with only a 25- 50% invested position.  So on a risk-adjusted basis the BDH strategy is outperforming the market. and is in 10th place out of 18 strategies followed by the website.  See the “Strategies Summary” link on the top of their page.

Top 5 ETFs –   Stay 75% in Cash

The portfolio is still 75% invested in cash.   The only remaining position is XLI up 6.08% since its purchase.  This past week only 6 ETFs had pass ratings compared to 24 a few weeks ago.  So the market decline had resulted in numerous ETFs experiencing negative MACD crossovers which one of the ‘fail’ criteria.

Here is the link to the Top 5 ETF spreadsheet:

Top-5-ETF-May 6, 2016

The  ETF portfolio has gained 1.76% since the earlier Dashboard BUY signal compared to 5.20% for the major averages.   Clearly, by not going all-in on the earlier BUY signal, the portfolio performance has suffered.  Our prudence had cost us about a 3.4 percentage points of profit, but year-to-date, as mentioned earlier the BDH performance was more in line with two of the three major averages.

Decision Page

Here is the link to the Decision Page:  http://www.etfscreen.com/buydonthold/bdh-decision-page.php

To get a feel where the best performing ETFs are by asset class, I suggest that you pull up the seven asset classes on the right side of the Decision Page (in blue ink) to see which ETFs have been doing the best — e.g., sector ETFs.  You can click on the down arrow in the three month and one month columns of the each grouping to see short-term performance.  You will note the strong performance of metals,  and a few sector funds, plus GDX and SLV in Commodities.

Conclusion  —  Caution is Still Urged — Market Now in Short-term Down Trend

The market has paused to refresh the past two weeks. We’ll maintain the 5% trailing stop at $54.32 on XLI  to protect against a market reversal that may start at any time.

Because of the market’s technically oversold condition, the market may mark time or slowly move higher.  However, neither of those conditions may occur and the market may continue to decline further.

Have a good week!  Happy Mothers Day !!

Remember that you are responsible for your investments and how you manage them.   If you decide to follow the BDH strategy, then you are responsible for checking the BDH indicators daily during times when the market is volatile.  Just bookmark the two charts above and look for any signal changes.  I may not available during the week to provide interim Dashboard signal changes. It is important to be pro-active so as not to miss any Dashboard signals. Decide on and place your stop LIMITS that meet your risk profile.Has Mixed