Blog

Jul 04

Market Review COMP July 2 2015

The stock market had a rough week with a big down day on Monday due to the possibility of a Greek default and other financial news.  The Greek referendum vote this weekend will impact market volatility and direction next week, but it will not have a major influence overall on the market’s future direction as Greece is a rather small part of the European economy and financial system.

The big drop on Monday resulted in two ETFs (XHB and XLV) being sold at at their trailing 3% stops.  Currently only XLY remains in the portfolio.  Moreover on Monday, Indicators #2 and #5 both had SELL signals resulting in a Dashboard “2” Neutral rating.  On July 1 Indicator #2 was able to rise above its 100-dma and thus issue a BUY signal.  However, that indicator is only 15 points away from this moving average, so a decline of that amount or more would result in a SELL signal again on this indicator.  Indicator #8 had a negative MACD crossover on July 1 comfirming the prior Index’s crossover of its 5-day ema.  So the Dashboard is still on a “2” Neutral reading at week’s end.

The market internals continue to weaken as the number of new 52-week highs on the NYSE was only 115 while the number of new lows ballooned to 514 of which about 200 were either preferred issues or fixed income type securities.  So the market is continuing to weaken and fewer stocks are participating in the market’s overall march to new highs.  Also, only 44% of all NYSE stocks were above their respective 200-dmas and only 30% were above their 50-dmas.

Last week the NASDAQ Composite lost 1.40%, followed by the DJIA losing 1.21%, and the S&P 500 losing 1.18%.  For the year-to-date, the NASDAQ is up 5.77% while the S&P 500 is up pnly 0.87%, and the DJIA is down0.52%.  The BDH strategy in comparison is down 1.81%.

The NASDAQ Composite finally breached its 25-day trading range (two upper parallel blue horizontal lines on first chart) on June 18 but now has declined to its prior support line around 5010.  We will see if it can hold that critical line  next week.

Bond prices were volatile and closed lower for the week as interest rates declined. Gold (GLD) prices also declined for the week nearing its yearly lows.  And gold miners (GDX) fell as well.   Crude oil (USO) was also lower for the 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 for the other averages.

Indicator Review –Three Changes NASI July 2 2015

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator remains on its new BUY signal of July 1.(Refer to first chart).

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD SELL signal on June 29 (refer to first chart) shown by the red  arrow at the bottom right corner of the chart.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest July 1 Bullish Percentage reading was 22.6% down significantly from the prior week’s reading of 35.5%.  Investors are now much less bullish on the market projecting out six months. This indicator is still on a May 27 BUY signal.  If it rises above 26% next week, that will be another confirming BUY signal as well,

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced a negative  crossover early in the week (5-day EMA red arrow on top in second chart) and then a July 1 MACD negative crossover thus triggering a SELL signal on this indicator on that date on this indicator. 

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 Remains on “2” NEUTRAL Signal

The latest update is shown here:

Dashboard-V2-July 3 2015_WC-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. For 2015, the BDH portfolio is in 16th place out of 18 total strategies measured by the site with a year-to-date loss of 1.81%. The BDH strategy is slightly under performing the market so far this year.

Top 5 ETFs –  20% Invested

The portfolio is 80% in cash with XLY as the only holding.  Below is the link to  the current portfolio:

Top-5-ETF-Tracking-July 3-2015

Notice that since the last BUY signal that the BDH portfolio is down 0.57% while the major averages are down 2.35%.  Therefore, the BDH strategy had a better performance during that period so far.

The ETFscreen table containing 52 ETFs had only 4 ETFs with a “pass” rating this week which is a extremely poor showing for a market that is near its highs for the year. Two of these ETFs are inverse ETFs.

This indicates the market’s mixed performance where only selective stocks are participating in this market upswing. This is a market showing internal weakness.

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 the sector funds as compared to the weak performance of the fixed income.

Conclusion  — Market Unstable

The market internals are very weak and the average stock is not participating in this rally.  International financial events will most likely impact the market this coming week until there is some kind of solution hammered out.  The BDH position of 20% invested is a testament to the focus of the strategy which is to protect against big losses in falling markets.

Be careful here as this is treacherous territory.  

Jun 29

Market SituationJune 29 2015

The NASDAQ Composite’s fell  2.40% today as the U.S. and world stock markets tumbled in unison, probably due to international news in Europe.  As you can see in the accompanying chart both Indicator #2 and #5 had sell signals, as the MACD had a negative crossover and the 100-dma (green line) was breached to the downside.

Also today, Indicator #8 had its index crossover its 5-day ema, but the MACD has not crossed over yet.

NASI June 29 2015Today two ETFs were sold in the Top 5 ETF Portfolio which were XHB and XLV hitting their 3% trailing stops.  Only XLY is in the portfolio.

A full report will be provided this weekend.

Jun 26

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

Market Situation COMP June 26 2015

This was another lackluster week with the market advancing on Monday and Tuesday and then declining the remainder of the week.  The exception was the DJIA which was up on Friday.  For the week the NASDAQ Composite fell 0.71%, the S&P 500 fell 0.40%, and the DJIA fell 0.38%. The DJIA and S&P 500 closed the week below their respective 50-dmas which is a negative sign.

Bonds, gold and gold miners, and oil all declined.   Gold miners had their lowest prices since early April, and bonds prices are now near their lows for the year.

On Friday SMH was sold as it fell 3% from its purchase price.  In addition, SMH fell to rank 26 on Friday from 17 on Thursday which is a SELL signal as well (remember that EFTs held are sold when they drop below rank 20).  Therefore, only three ETFs remain in the portfolio.

The AAII Bullish Sentiment Survey had 35.6% reading thereby issuing a confirming BUY signal.

Conclusion

This market is struggling to stay bullish.  As you can see in the above chart, the NASDAQ Composite is now below the nearest blue resistance line after exceeding it last week. Note that the MACD on this chart is about to cross over to the downside (see orange arrow).  If this occurs this coming week, then this would be a SELL signal on this indicator resulting in a Dashboard “3” BUY signal.

This is another negative situation.  Keep tight 3% trailing stops on all remaining positions.  This is a treacherous market so be very careful here.

A full blog will be provide next weekend.

 

Jun 20

Market Review COMP June19 2015

The stock market had another up and down week with a big day on Thursday where the NASDAQ Composite and Russell 2000 closed at new all-time highs.  The DJIA and S&P 500 are still a bit below their yearly highs and are lagging the prior two averages. Moreover, Indicator #5 had a positive MACD crossover on Friday resulting in a “4” Dashboard reading, its maximum bullish reading.  This reverses its early June 5th MACD downward crossover signal.

Based on this maximum Dashboard reading one would surmise that the market is very strong with most stocks participating in the rally.  This is not the case, as the market internals continue to be weak.  For example, the number of new NYSE 52-week highs this past week was only 237 compared to 241 new lows. Also, only 55% of all NYSE stocks are above their 200-dma, and only 44% are above their 50-dma.  These are certainly not very good numbers in a market at or near all time highs.

The NASDAQ Composite finally breached its 25-day trading range (two parallel blue horizontal lines) and is now above the upper blue support line (refer to first chart).  We well see if it can hold that line or advance further next week.  A decline below the lower blue line may indicate that this rally has run its course for now.

 In the end,  it was a pretty flat week, as was the prior two weeks.  For the week, the NASDAQ, the big winner, up 1.30%, while the S&P 500 was up 0.76%, and the DJIA was up 0.65%.  For the year-to-date,  the NASDAQ is up around 8.04%, the S&P 500 2.48%, and DJIA 1.08%.  So except for the NASDAQ the market has moved very little since 2014 ended.  Due to the whipsaw market, the BDH strategy year-to-date is down slightly at 1.44%.  Also, the strategy is ranked 15th out of 18th on dark-liquidity.

Bond prices were volatile and closed higher for the week as interest rates declined. Gold (GLD) closed higher while and gold miners (GDX) fell.   Crude oil (USO) was lower for the 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 for the other averages.

Indicator Review –One ChangeNASI June 19 2015

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

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD BUY signal on  June 19 (refer to first chart) shown by the green  arrow on the bottom right corner of the chart.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 17 Bullish Percentage reading was 25.4% which was a nice advance from the prior week reading of 20.0%.  Investors are now a bit more bullish on the market projecting out six months. This indicator is on a May 27 BUY signal.  If it rises above 26% next week, that will be a comfirming BUY signal as well,

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced another positive crossover on June 5 and June 19th with a 5-day EMA (green arrow on top in second chart).  The MACD is still on May 21st positive crossover thus triggering a BUY signal on this indicator on that date on this indicator. 

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 Remains on “4” BUY Signal

The latest update is shown here:

Dashboard-V2-June 19 2015_WC-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. For 2015, the BDH portfolio is in 15th place out of 18 total strategies measured by the site with a year-to-date loss of 1.44%. The BDH strategy is under performing the market so far this year.

Top 5 ETFs –  80% Invested

The portfolio is 20% in cash and will remain in cash as the mumber of ETFs with a pass rating keep fluctuating.  Below is the link to  the current portfolio:

Top-5-ETF-Tracking-June 19-2015

The ETFscreen table containing 52 ETFs had only 11 ETFs with a “pass” rating this week which is a extremely poor showing for a market that is near its highs for the year.  This indicates the market’s mixed performance where only selective stocks are participating in this market upswing. This is not a market showing internal strength.

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 the sector funds as compared to the weak performance of the fixed income.

Conclusion  — Market Make New Highs Again,    But ….

The market’s big rally on Thursday pushed two major averages to their all-time highs, as mentioned in the opening paragraph.  The market internals are weak and the average stock is not participating in this rally.  Leading the market are biotechs, technology and some international stocks.

Be careful here as this is treacherous territory.  The key to long-term stock market success is to minimize losses when the market declines.  This week or the next week may mark the highs for this market run followed by a decline in July through September, typically the weakest period of the year.  We will see what develops and wait for the Dashboard to signal a SELL or wait for the 3% TRAILING stops to hit, whichever occurs first.

Jun 12

This will be a short review which will occur every other weekend.

Market Situation

The market fell two to three days this week but was able to maintain its equilibrium and close mostly flat by Friday after a big run-up on Wednesday. The stock market roller-coaster continues in its two month trading range.  All averages moved by less than 0.50% for the week.  The AAII Bullish Sentiment reading of 20% this past week was the lowest reading since July 8, 2000.  When this indicator rises above 25% that will be a confirming BUY signal to support the recent BUY signal in the past few weeks.

So far the BDH strategy is down 2.45% for the year while the two major averages are slightly higher.  The NASDAQ Composite is up about 6%.  Gold and bond prices had a volatile week and keep reversing direction at week’s end.

The Top 5 ETFs continues to hold four positions: XHB (2) Pass, XLY (6) Fail,  Pass, XLV, (10) Fail, and SMH (18) Fail.

Even if the market declines from here in the next few weeks, the BDH strategy will most likely not issue a SELL signal yet.  That is because the NASDAQ Composite is still about 100 points away from its 100-dma (Indicator #2), and the AAII Bullish Sentiment Index needs to rise to 50% and then fall.  Both these events are not in the immediate future unless the market loses over 3% in the next week or so.  Therefore, it is imperative to keep tight stops (3% recommmended but it is your choice) to prevent principal deterioration if the market declines over the next few weeks.

Enjoy the summer.  Next weekend’s blog will be a full report.

 

 

Jun 05

Market Review COMP June 5 2015

Since the last full blog two weeks ago, there have been two indicator changes.  First Indicator #6 gave a BUY signal on May 27, its first in over two years resulting in a “4” Dashboard reading that I posted in an interim blog.  Second Indicator #5 had a negative crossover today resulting in a “3” Dashboard reading.  So we are still on a BUY signal, but the market is looking weak internally as many stocks are not participating in the latest run to new highs.

The NASDAQ Composite is moving between the two blue resistance lines in the accompanying chart, and is still the leading index so far this year.  The number of new 52-week highs continues to run around 200 which is much lower than normal when the market is at such a high level.  This is an ominous sign go forward.

In the end,  it was a pretty flat week, as was the prior week.  For the week, the NASDAQ was down only  0.03%, while the S&P 500 was down 0.70%, and the DJIA was down 0.94%.  For the year-to-date,  the NASDAQ is up around 7.4%, the S&P 500 2.9%, and DJIA 1.3%.  So except for the NASDAQ the market has moved very little since 2014 ended.  Due to the whipsaw market, the BDH strategy year-to-date is down slightly at 2.55%.  Also, the strategy is ranked 15th out of 18th on dark-liquidity.

Bond prices were volatile and closed at the lows for the year as interest rates rose. Gold (GLD) and gold miners (GDX) tumbled hitting four month lows.  Crude oil (USO) was done for the week, but rallied on Friday.  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 for the other averages.

Indicator Review –One ChangeNASI June 5 2015

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

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD SELLsignal on  June 5 (refer to first chart) shown by the green  arrow on the bottom right corner of the chart.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest June 3 Bullish Percentage reading was 27.3% which was a slight advance from the prior week reading of 27.0%.  Investors are now a bit more bullish on the market projecting out six months. This indicator is on a May 27 BUY signal.

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced another positive crossover on June 5 with a 5-day EMA (green arrow on top in second chart).  The MACD is on May 21st BUY signal thus triggering a BUY signal on this indicator. 

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 Remains on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-June 5 2015_WC-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. For 2015, the BDH portfolio is in 15th place out of 18 total strategies measured by the site with a year-to-date loss of 2.55%. So the BDH strategy is now under performing the market so far this year.

Top 5 ETFs –  80% Invested

The portfolio is 20% in cash as of the closeon Friday.  Since most of the ETFs are in a  “fail” mode, the proceeds from this sale will be held as cash. Below is the link to  the current portfolio:

Top-5-ETF-Tracking-June 5-2015

EFA was sold on Friday as it surpassed it 3% stop order.  Four ETFs remain the portfolio.  Note that all the Top 5 in the portfolio had a “fail’ rating, as of the close on Friday.

The ETFscreen table containing 52 ETFs had only 4 ETFs with a “pass” rating this week which is a extremely poor showing in a market that is near its highs for the year.  This indicates the market’s mixed performance where only selective stocks are participating in this market upswing. This is not a market showing internal strength.

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 the sector funds as compared to the weak performance of the fixed income.

Conclusion  — Market Struggles to Make New Highs Again and Again

The market experienced difficulty making headway this week based on domestic and overseas economic and financial news.  The market is in a tight trading range as you can see in the first chart where the NASDAQ is fluctuating between the upper two horizontal blue resistance line.  That index made a new all-time intra-day high on Wednesday but could not exceed it buy week’s end.  Keep your stops tight (3% as recommended in the blog two weeks ago) as this market can go either way from here.

Be careful here as this is treacherous territory.  The key to long-term stock market success is to minimize losses when the market declines.

May 30

As mentioned previously, an abbreviated blog will be presented every other week.   This week’s blog is abbreviated.

Market Review

The market took a rest this week with an up and down ride. At week’s end all three averages fell slightly with the DJIA down 1.21%, the S&P 500 down 0.88% and the NASDAQ leader down only 0.38%.  This latter index hit an all-time high on Wednesday before backing off by week’s end.  The other two averages hit their highs 6 to 8 trading days ago and have since declined.

The Top 5 ETF portfolio is down 1.42% so far this year compared to a gain of 7.05% for the NASDAQ Composite, 2.36% for the S&P 500, and only 1.05% for the DJIA.  The number of new NYSE 52-week highs was only148 down from 225 the prior week.

The BDH strategy is ranked 15th out of 18th on dark-liquidity.

Bond prices rallied nicely but gold (GLD) and gold miners (GDX) went in the other direction.

Indicator Review –One Change

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest reading of 27.2 is an increase from the previous week’s 25.2%.  That means that this indicator is now on a new BUY after two years.  As mentioned last week. ” … since it so close to 25%, and has not given an actual BUY signal since April 17, 2013, I am considering this level as hitting the mark.  Therefore, if this reading rises above this level in any subsequent week this indicator will change to a BUY signal.”

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced a 5-day EMA negative crossover on May 26.  An MACD crossover in coming days would turn this indicator to a 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

Conclusion  — Market Stalls

The market took a breather last week.  At this time I’m recommending a 3% stop LIMIT order to protect against the possibility of the start of a decent size correction that everyone including me has been waiting for.  Remember that  you are responsible for managing your own money and setting your own stops.  Be careful here as this is treacherous territory.

Next weekend a full blog report will be provided.  Have a good week ahead.

May 24

Market Review COMP May 22 2015

The Thursday interim blog posting contained the latest BUY signal.  The Top 5 ETFs with a “pass” rating were purchased on the open on Friday morning.  I issued a correction on Friday as I mistakenly used XRT instead of XLV.  An extreme caution note was also mentioned on Thursday’s blog as this BUY signal is coming at market highs rather than the more normal market low points.

The stock market had a mixed week with the market little changed.  The DJIA hit a new closing high on Tuesday, as did the S&P 500 on Thursday.  The NASDAQ Composite is slightly below its May high just above 5100.  So the market continues to hold or make new highs, although the trading volume is sluggish and the underlying internal market conditions are mixed. For example, the  number of new 52-week highs on the NYSE came in at 225 up from 162 the prior week, an anemic number at best in a market near new highs.

In the end,  it was a pretty flat week, although the NASDAQ was up 0.81%, while the S&P 500 was down 0.16%, and the DJIA was down 0.22%.  For the year-to-date,  the NASDAQ is up 7.46%, the S&P 500 3.26%, and DJIA 2.29%.  So except for the NASDAQ the market has moved very little since 2014 ended.  Due to the whipsaw market, the BDH strategy year-to-date is down slightly at 1.40%.  Also, the strategy is ranked 16th out of 18th on dark-liquidity.

Bond prices were volatile but closed lower, as did gold (GLD) and gold miners (GDX).  Crude oil (USO) had a  flat 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 for the other averages.

Indicator Review –One ChangeNASI May 22 2015

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

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD BUY signal on  May 15 (refer to first chart) shown by the green  arrow on the bottom right corner of the chart.

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest May 20 Bullish Percentage reading was 25.2% which was a decline from the prior week reading of 26.7%.  Investors are now less bullish on the market projecting out six months.  Remember that this indicator needs to fall below 25% in one week and then rise above that level in a future week to signal a BUY on this indicator.  However, since it so close to 25%, and has not given an actual BUY signal since April 17, 2013, I am considering this level as hitting the mark.  Therefore, if this reading rises above this level in any subsequent week this indicator will change to a BUY signal.

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced a positive crossover on May 15 with a 5-day EMA (green arrow on top in second chart), as did the MACD  on May 21st this past week, thus triggering a BUY signal on this indicator. 

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 Remains on “3” BUY Signal

The latest update is shown here:

Dashboard-V2-May 22-2015_WC-1

Dark Liquidity BDH Performance Statistics

www.dark-liquidity.com/BDHV2new.php independently tracks the BDH performance. For 2015, the BDH portfolio is in 16th place out of 18 total strategies measured by the site with a year-to-date loss of 1.40%. So the BDH strategy is now under performing the market so far this year.

Top 5 ETFs –  100% Invested

The portfolio is 100% in cash as of the open on Friday, May 22 as shown in the link.  Below is the link to  the current portfolio:

Top-5-ETF-Tracking-May-22-2015

The Top 5 ETFs with a pass rating as of Thursday night were: XHB,XLY,SMH,XLV, and EFA.  Note that EFA is an international ETF.  International ETFs have beaten the US markets this year so it good to see this ETF rising to the top of the ranks after a number of years of lackluster performance.

The ETFscreen table containing 52 ETFs had only 19 ETFs with a “pass” rating this week which is a very weak showing in a market that is near its highs for the year.  This indicates the market’s mixed performance where only selective stocks are participating in this market upswing. This is not a market showing internal strength.

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 the sector funds as compared to the weak performance of the fixed income.

Conclusion  — Market Struggles to Make New Highs Again

The market had small moves the last six trading days.  See the small size candlesticks on the first chart.  Typically, when a market moves in a tight range for a while, the next move tends to be large.  However, no one knows which direction that will take, so we’ll have to wait and see what develops.  At this time I’m recommending a 3% stop LIMIT order to protect against the possibility of the start of a decent size correction that everyone including me has been waiting for.  Remember that  you are responsible for managing your own money and setting your own stops.  Be careful here as this is treacherous territory.

May 22

Please use XLV not XRT as one of the Top 5 ETF new buys.  I made a mistake in selecting it.  Thank you Cario for pointing it out to me.

May 21

Market SituationNASI May 21 2015

The recent market advance and new highs on the S&P 500 and DJIA has resulted in a Dashboard “3” BUY signal as Indicator #8 experienced an MACD upward crossover confirming the 5 day-ema crossover a number of days ago. (see chart).

This BUY signal is coming at a market high rather than a market low indicates that it is a much higher risk signal.  The market’s direction and move from here is unknown, but appears to be headed higher.

Tomorrow morning the Top 5 ETFs with a pass rating will be bought for the portfolio at their opening price.  These are: xhb (2), xly(3), smh (4), xrt (5), and efa (7).  A suggested stop limit of 3% is recommended because of the level of the market compared to the buy signal date.  A full report will be provided this weekend.

Extreme caution is urged as this BUY signal is coming at a sub-optimal time.