Blog

Jul 20

Market Review COMP July 18 2014

The market had a rough week with geopolitical events taking center stage.  Nevertheless, it recovered nicely by week’s end with small gains.  The Dashboard remains on its “1″ SELL signal.

The NASDAQ Composite dropped below its closest resistance line (see chart to the right) on Thursday, but closed it above it on Friday after a nice recovery from the Thursday lows.

For the week, the NASDAQ Composite had the weakest performance  rising 0.38%,  followed by the S&P 500 gaining 0.54%. The DJIA gained the most at 0.92% and hit a new high 2014 during the week as well.  New NYSE 52-week highs totaled 386 above the  308 from the prior week.  That indicates the market’s internals are strengthening slightly.

For the year-to-date, the NASDAQ Composite is up 6.12%, the S&P 500 is up 7.03%, and the DJIA is up only 3.16%. In comparison, the BDH portfolio is up 6.62% this year, and is  100% in cash.

Gold (GLD) and, gold mining issues (GDX) had a wild week, but ended on the downside while bonds continued their march higher.  Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

Indicator Review –No ChangesNASI July 18 2014

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover SELL signal on July 9 . (Refer to first chart).  Note the blue arrow indicating the bounce up off the resistance line.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest July 16th bullish percentage reading was 32.4% which was lower than the July 9th  bullish percentage reading of 37.6%. Investors are  less  bullish going out six-months into the future, as they may be getting concerned about the market’s continued advance without a meaningful correction.

Indicator #8 NASI Summation Index and MACD. This indicator had a clear-cut MACD crossover SELL signal on July 10, while the Index crossed below its 5 day-ema on July 8.  Note the two downward blue arrows.  (Refer to the second chart and the arrows indicating the two potential downward crossover areas if the market falls next week.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard on “1” SELL Signal

The latest update is shown here:

Dashboard-V2-July 18 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 6.62 % compared an average gain of 5.44% for the three major averages.

Top 5 ETFs – 100% Cash

No ETFs are held at this time.

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now only 6 out of 42, the lowest number in months.  This decrease is worrisome as many ETFs have experienced MACD sell signals.

Conclusion – Market Holds Steady in Light of Disturbing  Global Events

It looked like the beginning of the correction after the market’t pummeling on Thursday.  Amazingly, the market rebounded smartly and even ended the week higher. So we’ll have to wait and see what develipes.  Being 100% in cash is certainly acceptable based on the precarious situation overseas.  We will wait patiently in cash for the next Dashboard buy signal.

 

 

Jul 12

Market Review COMP July 11 2014

The market experienced two big down days this past week with minor recovery by week’s end.  This down swing resulted in Indicators #5 and #8 issuing Dashboard SELL signals, as the MACD was breached to the downside.  Currently, the Dashboard resides at “1″.  The NASDAQ Composite is well above its 100-dma (Indicator #2) so the likelihood of the Dashboard falling to a “0″ rating is not imminent.

The NASDAQ dropped below its highest resistance level (top blue horizontal line) on Thursday, but was able to close above it by Friday.  Most likely, this index will either form a head-and-shoulders pattern if it continues to decline or hit another yearly high if it rises.

For the week, the NASDAQ Composite had the worst performance  falling 1.57%,  followed by the S&P 500 losing 0.90%. The DJIA declined the least at 0.73%.  New NYSE 52-week highs totaled 308, down substantially from  599 the prior week.  That indicates the market’s internals are weakening.

For the year-to-date, the NASDAQ Composite is up 5.72%, the S&P 500 is up 6.45%, and the DJIA is up only 2.21%. In comparison, the BDH portfolio is up 6.62% this year, and is now 100% in cash.

Gold (GLD), gold mining issues (GDX) and bonds all solid  advanced during the week. GDX is nearing its highs for the year. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

Indicator Review –Two Changes

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover SELL signal on July 9 . (Refer to first chart).  Note the blue arrow indicating the downward crossover..

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest July 9th bullish percentage reading was 37.6% which was slightly lower than the July 2nd  bullish percentage reading of 38.5%. Investors are slightly less  bullish going out six-months into the future, as they may be getting concerned about the market’s continued advance without a meaningful correction.

Indicator #8 NASI Summation Index and MACD. This indicator had a clear-cut MACD crossover SELL signal on July 10, while the Index crossed below its 5 day-ema on July 8.  Note the two downward blue arrows.  (Refer to the second chart and the arrows indicating the two potential downward crossover areas if the market falls next week.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard on “1” SELL Signal

The latest update is shown here:

Dashboard-V2-July 11 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 6.62 % compared an average gain of 4.79% for the three major averages.

Top 5 ETFs – 100% Invested

All  ETFs ( EPI, IYT, XLB, VGT and XLV) were sold at the open on Friday.   You should note that all five had a “fail” rating with a negative reading in their MACD column.  During this last Dashboard BUY signal the portfolio gained only 2.06% compared to the bcnchmark average of 3.28%.  The volatility of EPI and the lost of 2.03% in this ETF contributed to its poorer performance.

See table showing the results of the Top 5: Top 5 ETF Tracking July 11, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now only 7 out of 42, the lowest number in months.  This decrease is worrisome as many ETFs are experiencing MACD sell signals.

Conclusion – Market Sells Off

The market’s two big down days this past week, coupled with many more “fail” ratings in our ETF listing finally resulted in a Dashboard SELL signal.  This signal was not unexpected in light of the market’s weakening internals (e.g., number of new highs compared to prior market peaks).  This week may be the beginning of the third quarter correction that many are expecting.  We will wait patiently in cash for the next Dashboard buy signal.

 

 

Jul 10

COMP July 10 2014

Market Situation

The stock market had two major down days this week culminating in a Dashboard SELL signal “1″ at today’s close.  Indicator #5 (see first chart) and #8 (see second chart) , issued SELL signals on July 9 and 10th, respectively.

Accordingly, the current Top 5 ETF portfolio will be sold at their opening prices on Friday morning.

A full report will be provided this weekend.

NASI July 10 2014

Jul 04

CORRECTION TO JULY 4 BLOG

Market ReviewComp July 4 2014

This will be an abbreviated review this holiday weekend,  The full market review will be provided next weekend.

The stock market continued its upward move with the NASDAQ advancing over 2% this week leading all three averages higher.  Indicator #6 was set to a “0″ reading from a -1 as it

has not changed its value in six months.  This still leaves the Dashboard at a “3″ bullish reading.  This can be seen in the table:

Dashboard-V2-July 4 , 2014

The Top 5 ETFs are doing well,  are aup 8.88% for the YTD as seen on www.dark-liquidity.com.

10% Correction Coming?

Some readers of this site are concerned about the market’s continued advance without having a 10% correction since October 2011.  The question I’ve been asked is

what do my indicators show regarding a possible correction of this magnitude and when will that correction occur.  Most technical indicator are showing a strong market or an overbought condition.

Thus, the market is still in an uptrend and could go even higher.  Nevertheless, the July through September period is typically the weakest time of year for the market.  So we may see a correction during

this time period.  But we won’t know until it occurs.   Therefore, every investor needs to have their stop LIMIT orders or trailing stops in place to protect principal.

Have a great July 4th weekend.

 

Jun 28

Market Review COMP June 27 2014

This past week the stock market meandered without much change.  Both the S&P 500 and DJIA declined slightly while the NASDAQ Composite closed on a yearly high just shy of 4400.  Even with some negative economic news and tensions rising in the Middle East, the market was able to handle the news without a sell-off.

For the week, the DJIA had the worst performance  of the three averages for the second consecutive week and fell 0.56%,  followed by the S&P 500 losing only 0.10%. The NASDAQ Composite had good performance gaining 0.68%.  New NYSE 52-week highs totaled 556 down slightly from  574 the prior week.

For the year-to-date, the NASDAQ Composite is up 5.30%, the S&P 500 is up 6.09%, and the DJIA is up only 1.66%. In comparison, the BDH portfolio is up 6.71% this year, and is 100% invested.

Gold (GLD), gold mining issues (GDX) and bonds all  advanced during the week.  Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

Indicator Review –No Changes NASI June 27 2014

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart).  Note the two blue arrows indicating the breakthrough new high and the flattening MACD line.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 25th bullish percentage reading was 37.2% which was much lower than the June 18th bullish percentage reading of 35.2%. Investors are slightly less  bullish going out six-months into the future, as they may be getting concerned about the market’s continued advance without a meaningful correction.

Indicator #8 NASI Summation Index and MACD. This indicator is on a BUY signal as of April 28. (Refer to the second chart and the arrows indicating the two potential downward crossover areas if the market falls next week.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard Remains on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-June 27 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 6.71 % compared an average gain of 4.35% for the three major averages.

Top 5 ETFs – 100% Invested

All  ETFs ( IYT, XLB, VGT and XLV) are performing well,except for EPI which is the weakest performer   You should note that 4 of the 5 the Top 5 ETFs also have a “fail” rating with a negative reading in their MACD column. EPI held its #1 position, but is rapidly losing steam and has the worst performance over the past four weeks among all ETFs tracked. Also, VGT is nearing a potential sell signal if it falls below rank 20 on any daily close.

See table showing the results of the Top 5: Top 5 ETF Tracking June 27, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now only 17 out of 42 compared to 28 in the prior week.  This decrease is worrisome as many ETFs are showing MACD sell signals.

Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis or they fall below their stop LIMIT order whichever scenario occurs first.

Conclusion – Market Advance Stalls

The market’s overall trend remains upward, but internals are weakening. The BDH strategy is still in a “BUY” mode. Make sure to use stop limit orders to protect your principal.

Jun 21

Market Review COMP June 20 2014

This past week the stock market had a nice smooth advance higher with the S&P 500 and DJIA averages making new highs for the year. The NASDAQ is approaching its March 2014 high (refer to circles on the first chart0 and is only a few points away from breaking to new highs. For the week, the DJIA had the worst performance  again, but gained 1.02% followed by the S&P 500 gaining 1.38%. The NASDAQ Composite had good performance gaining 1.33%.  New NYSE 52-week highs totaled 574 matching that of the week of June 6 and the highest in months.

For the year-to-date, the NASDAQ Composite is up 4.58%, the S&P 500 is up 6.20%, and the DJIA is up only 2.23%. In comparison, the BDH portfolio is up 6.46% this year, and is 100% invested.

Gold (GLD) and gold mining issues (GDX)  had a spectacular week advancing smartly and closing the week near its highs. Bonds had a choppy week without much change. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

Indicator Review –No Changes NASI June 20 2014

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart). The MACD is starting to flatten.  Be on the lookout for a possible downward crossover on this indicator this week if the market moves lower.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 18th bullish percentage reading was 35.2% which was much lower than the June 11th bullish percentage reading of 44.7%. Investors are now much less  bullish going out six-months into the future, as they may be getting concerned about the market’s continued advance without a meaningful correction.

Indicator #8 NASI Summation Index and MACD. This indicator is on a BUY signal as of April 28. (Refer to the second chart and the arrows indicating the two crossover areas.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-June 20 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 6.46 % compared an average gain of 4.34% for the three major averages.

Top 5 ETFs – 100% Invested

All  ETFs (EPI, IYT, XLB, VGT and XLV) are performing well,except for EPI which lost ground last week.   You should note that 3 of the 5 the Top 5 ETFs also have a “fail” rating with a negative reading in their MACD column. EPI held its #1 position, but is rapidly losing steam and has the worst performance over the past four weeks among all ETFs tracked. IYT, XLV and VGT also dropped a few positions in the table.

See table showing the results of the Top 5: Top 5 ETF Tracking June 20, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now at 28out of 42 compared to 19 in the prior week.  This increase is not surprising in light of the market’s upwared bias last week.

Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis or they fall below their stop LIMIT order whichever scenario occurs first.

Conclusion – Market Advance Continues

The market’s overall trend remains upward, and internals are strengthening. The BDH strategy is still in a “BUY” mode. The Fed’s positive comments had a positive impact on the market.  Make sure to use stop limit orders to protect your principal.

Jun 15

Market Review COMP June 13, 2014

This past week the stock market had a slight downward bias with international and political news taking the forefront. For the week, the DJIA had the worst performance  losing 0.88% followed by the S&P 500 losing 0.68%. The NASDAQ Composite had the best relative performance losing only 0.25%.  Many technology, momentum and social media stocks again experienced high volatility.  This was accompanied by big movers in energy and gold issues.

For the year-to-date, the NASDAQ Composite is up 3.21%, the S&P 500 is up 4.75%, and the DJIA is up only 1.20%. In comparison, the BDH portfolio is up 5.61% this year, and is 100% invested.

Gold (GLD) had s solid week advancing smartly and closing the week on its highs. Bonds had a mixed week. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

Indicator Review –No Changes NASI June 13, 2014

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart). The MACD is starting to turn down but a crossover has not yet occurred.  Be on the lookout for a possible signal change onthis indicator this week if the market moves lower.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 11th bullish percentage reading was 44.7% which was higher than the June 4th bullish percentage reading of 39.5%. Investors are now more bullish going out six-months into the future.

Indicator #8 NASI Summation Index and MACD. This indicator is on a BUY signal as of April 28. (Refer to the second chart and the arrows indicating the two crossover areas.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-June 13 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 5.61 % compared an average gain of 3.05% for the three major averages.

Top 5 ETFs – 100% Invested

All five ETFs (EPI, IYT, XLB, VGT and XLV) are performing well, but 4 out 5 lost ground last week.   You should note that 4 of the 5 the Top 5 ETFs also have a “fail” rating with a negative reading in their MACD column. EPI held its #1 position, but all the other ETFs dropped a number of positions since the prior week.

See table showing the results of the Top 5: Top 5 ETF Tracking June 13, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now at 19 out of 42 compared to 27 in the prior week.  This decline is not surprising in light of the market’s slight downward bias last week.

Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis or they fall below their stop LIMIT order whichever scenario occurs first.

Conclusion – Market Stalls Here

The market’s overall trend remains upward, but internals are weakening. The BDH strategy is still in a “BUY” mode. We will see what develops next week with the Fed’s Wednesday meeting announcement.  Make sure to use stop limit orders to protect your principal

HAPPY FATHER’S DAY TO ALL

Jun 08

COMP June 6 2014Market Review

This past week was another winner with two of the three major averages closing on highs for the year, with the S&P 500 and DJIA closing at all-time highs. New 52-week highs on the NYSE surged higher to 574 compared to 425 for the prior week. For the week, the DJIA gained 1.24% compared to a 1.86% for the NASDAQ Composite and 1.34% for the S&P 500. Many technology, momentum and social media stocks again experienced high volatility recovering more of their recent losses.

For the year-to-date, the NASDAQ Composite is up 3.47%, the S&P 500 is up 5.47%, and the DJIA is up 2.10%. In comparison, the BDH portfolio is up 7.27% this year, and is 100% invested.

Gold (GLD) made a slight advance toward week’s end. Bonds recovered most of their Monday’s losses. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

NASI June 6, 2014Indicator Review –No Changes

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal and well above its 100-dma. (Refer to first chart).

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart). The MACD is approaching levels seen near the early March highs.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 4th bullish percentage reading was 39.5% which was higher than the May 28th bullish percentage reading of 36.5%. Investors are now more bullish going out six-months into the future.

Indicator #8 NASI Summation Index and MACD. This indicator is on a BUY signal as of April 28. (Refer to the second chart and the arrows indicating the two crossover areas.)

A chart of the buy and sell signals is presented here, but may not be updated yet:
http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893
Dashboard on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-June 6 , 2014

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far, year-to-date the BDH portfolio is up 7.27% compared an average gain of 3.68% for the three major averages.

Top 5 ETFs – 100% Invested

All five ETFs (EPI, IYT, XLB, VGT and XLV) are performing well with EPI not only overcoming a 3.07% previous weekly loss, but now leading the way higher with a gain of 5.32%. You will note that all of the Top 5 ETFs also have a “pass” rating. VGT and XLV slipped a notch during the past week, but are still not close to dropping below rank 20 which is one of the selling criteria.
See table showing the results of the Top 5: Top 5 ETF Tracking June 6, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now at 27 out of 42 compared to 20 in the prior week. These average readings clearly illustrate the market’s positive bias the past few weeks. If you look at the seven categories of ETFs on the right side of the page and click on the Sector Funds tab you will not the high relative strength ranking.

Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis or they fall below their stop LIMIT order whichever scenario occurs first.

Conclusion – Market Advance Continues

The market’s current direction remains upward and remains so until the BDH strategy notes otherwise. The potential head-and-shoulders chart pattern mentioned last week on the NASDAQ Composite appears to be dead for now, as the right shoulder is not showing a drop. Always use stop limit orders to protect your principal after making any ETF purchases.

May 31

COMP May 30 2014

Market Review

After a nice rise last week, the stock market continued its orderly advance ending the week on its highs with all indexes capturing gains. The S&P 500 made a new all-time high on Friday by closing at 1923.57. The DJIA also closed at its high for the year at 16717.17. And the NASDAQ Composite had a solid week closing at 4242.62 nearing its high for the year set s few weeks ago. Finally, new 52-week highs expanded to 425 from readings in the 300s in prior weeks.
For the week, the DJIA gained 0.67% compared to a 1.36% for the NASDAQ Composite followed by 1.21% for the S&P 500. Many technology, momentum and social media stocks again experienced high volatility recovering some of their recent losses.
For the year-to-date, the NASDAQ Composite is up 1.58%, the S&P 500 is up 4.07%, and the DJIA is up 0.85%. In comparison, the BDH portfolio is up 4.63% this year, and is 100% invested as of the open on Tuesday morning.
Gold (GLD) got clobbered this week closing near the February lows. Bonds had a terrific ending at or near its high for the year. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart. It is interesting to note that both stocks and bonds are simultaneously at their respective highs for the year. The last time this occurred was the 1990s and is a rare occurrence. Why this is happening now compared to 24 years ago as anyone’s guess. But the experts who predicted that bond prices were headed lower in 2014 have missed the mark by a wide margin.

NASI May 30 2014

Indicator Review – No Changes
Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal as of Friday’s close above its 100-dma. (Refer to first chart). Note that the last two times it crossed above this level in April and May that it quickly reversed below that level. We will see if it is able to move higher to the next level of resistance around 4250, and then 4375. It is at 4242 currently.
Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart)
Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest May 26th bullish percentage reading was 36.5% which was higher than the May 19th bullish percentage reading of 30.4%. Investors are now slightly less bullish going out six-months into the future. This indicator remains on its SELL signal. Remember that a decline below 25% and a subsequent rise above that level in a future week will generate a BUY signal.
Indicator #8 NASI Summation Index and MACD. The index crossed above its 5-day ema (see blue arrow) on Friday. The MACD indicator also had an upward crossover on Friday after flat lining since April 28. So this indicator is now on a BUY signal. (Refer to the second chart and the arrows indicating the two crossover areas.)
A chart of the buy and sell signals is presented here, but may not be updated yet:

http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893

Dashboard on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-May30 , 2014

Dark Liquidity BDH Performance Statistics
www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far year-to-date the BDH portfolio is up 4.63% compared an average gain of 2.17% the three major averages.

Top 5 ETFs – 100% Invested

On Tuesday morning at the open the following ETFs were purchased: EPI, IYT, XLB, VGT and XLV. You will note that some of the top 5 ETFs did not have a “pass” rating so they were not selected. Also, QQQ was not selected as VGT was in the same sector and we did not want a duplicate situation. Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis or they fall below their stop LIMIT order of % whichever scenario occurs first.
By week’s end EPI fell 3.07% hurting the overall results of the Top 5 ETF portfolio which was up only 0.08% compared to 1.21% for the three major averages. I will be using a 10% stop limit order on EPI, as it is in the more volatile international ETF segment. See table showing the results of the new purchases:

Top 5 ETF Tracking May 30, 2014

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now at 20 out of 42 compared to 14 in the prior week. These average readings clearly illustrate the market’s internal weakness even though the major averages are moving higher.
Conclusion – Market Advance Continues

The market’s current direction is upward. May was a solid month for all the averages, especially the NASDAQ Composite rising more than 3%. Interestingly, there is a head-and-shoulders chart pattern forming on this index and we will see if it breaks down from here or continues to accelerate.

The BIG question is whether the market’s momentum will fade here and head into correction mode. The fact that the Dashboard has given a “3” BUY signal now is indicating that its upward trend is still intact.

This is still a dangerous market to be invested in, as it is way overdue for a 10% or more correction. That doesn’t mean the market can’t go much higher from here, but the probabilities do not favor it. Always use stop limit orders to protect your principal after making any ETF purchases.

May 24

COMP May 23 2014Market Review

The stock market ended the week on its highs after a mixed few days and different trading patterns in the big three major averages. Whereas the NASDAQ Composite had a clear uptrend throughout the week, the S&P 500 was mostly flat mid-week, and the DJIA had a big down day Tuesday before firming up at week’s end.

The S&P 500 made new all-time highs on Friday by closing at 1900.53. The DJIA was about 100 points below its previous high the week before. And the NASDAQ Composite finally rebounded after a few weeks of choppy again comfortably above the 4100 closing at 4185.81 and still well below its early March high of 4371.71. This bifurcated market performance indicates that the vast majority of underlying securities are not advancing while selective defensive and high-quality stocks are moving higher. Moreover the number of new NYSE 52-week highs last week came in at only 290 its lowest level in many weeks.

For the week, the DJIA gained 0.70% compared to a rousing 2.33% for the NASDAQ Composite followed by 1.21% for the S&P 500. Many technology, momentum and social media stocks again experienced high volatility recovering some of their recent losses.Due to the NASDAQ’s solid performance Indicators #2 and #5 experienced BUY signals on Friday. This has resulted in the Dashboard being on a “3” BUY signal at the close on Friday. Here again we have another case of a BUY signal coming near or at market highs which is not where this type of signal is supposed to occur. Nevertheless, on the market’s open on Tuesday, after the holiday close on Monday, the Top 5 ETFs with a “pass” rating will be purchased at the opening price. See below for more details on this purchase.

For the year-to-date, the NASDAQ Composite is up 0.22%, the S&P 500 is up 2.82%, and the DJIA is up 0.18%. In comparison, the BDH portfolio is up 4.55% this year, and will stay in a 100% cash position until Tuesday’s new purchases.
Gold (GLD) had a flat week with no trend. Almost most experienced little movement and a flat week, slightly off their highs of two weeks ago. Please type in ETF ticker symbols IEF, TLT, BOND, SHY or AGG or others one at a time to see their current week’s performance after pulling up the NASDAQ Composite chart.

NASI May 23 2014Indicator Review – Two Changes

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator is on a BUY signal as of Friday’s close above its 100-dma. (Refer to first chart). Note that the last two times it crossed above this level in April and May that it quickly reversed below that level. We will see if it is able to hold solidly above this level and move higher to the next level of resistance around 4250, and then 4375.

Indicator #5 NASDAQ Composite with MACD. This indicator had a clear-cut MACD crossover BUY on April 22nd . (Refer to first chart)

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest May 19th bullish percentage reading was 30.4% which was slightly lower than the May 12th bullish percentage reading of 33.1%. Investors are now slightly less bullish going out six-months into the future. This indicator remains on its SELL signal. Remember that a decline below 25% and a subsequent rise above that level in a future week will generate a BUY signal.

Indicator #8 NASI Summation Index and MACD. The index crossed above its 5-day ema (see blue arrow) on Friday. The MACD indicator also had an upward crossover on Friday after flat lining since April 28. So this indicator is now on a BUY signal. (Refer to the second chart and the arrows indicating the two crossover areas.)

A chart of the buy and sell signals is presented here, but may not be updated yet:

http://stockcharts.com/h-sc/ui?s=$COMPQ&p=D&yr=2&mn=0&dy=0&id=p50034199149&a=250074893

Dashboard on “3” BUY Signal
The latest update is shown here:

Dashboard-V2-May 23 , 2014

Dark Liquidity BDH Performance Statistics
www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. So far year-to-date the BDH portfolio is up 4.55% compared an average gain of 1.07% the three major averages.

Top 5 ETFs – 100% In Cash Until Tuesday

On Tuesday morning at the open, the following ETFs will be purchased: EPI, IYT, XLB, VGT and XLV. You will note that some of the top 5 ETFs did not have a “pass” rating so they were not selected. Also, QQQ was not selected as VGT was in the same sector and we did not want a duplicate situation. Remember that none of the ETFs selected will be sold unless there is a Dashboard SELL signal or any of them drop below rank 20 on a daily basis whichever scenario occurs first.

Note that on the etfscreen.com/buydonthold Decision page that the number of ETFs with a “pass” rating is now at only 14 out of 42 compared to 10 in the prior week. These low readings clearly illustrate the market’s internal weakness even though the major averages are moving higher.

Conclusion – Market Advances, But…
The market’s future direction is uncertain. The S&P 500 has made new highs, but the other two indexes are still lagging behind. The number of new 52-week highs (290 in the past week) is well below levels at prior market peaks. Many popular tech and social media stocks are well off their highs. The BIG question is whether the market’s momentum will fade here and head into correction mode. The fact that the Dashboard has given a “3” BUY signal now is disconcerting, as it has occurred near market highs rather than near market bottoms or after correction lows.

This is still a dangerous market to be invested in, as it is way overdue for a 10% or more correction. That doesn’t mean the market can’t go much higher from here, but the probabilities do not favor it. It is your decision as to whether you take this BUY signal, as you are solely responsible for your investments. Always use stop limit orders to protect your principal after making any purchases.