Blog

Aug 02

Market Review COMP July 31 2015

The market’s sharp intra-day decline on Monday resulted in the sale of two of the Top 5 ETFs, after two others were sold the prior Friday (July 24), all sold at their 3% stops.  Therefore, only XLY remains in the portfolio.  The market rebounded nicely the remainder of this past week, but is still in a trading range below the recent highs.  Also, on Tuesday, both Indicators #5 and #8 had MACD SELL signals resulting in the Dashboard retreating to a “2” NEUTRAL reading.

The NASDAQ is well above its 100-dma (Indicator #2) and continues to be the leading index in performance for the year to date at 8.28%, mostly attributable to a handful of technology high fliers and biotech giants.  The rest of the market is not doing much, as the S&P 500 is up a meager 2.18% for the year, followed by the DJIA actually down 0.75%. The BDH strategy in comparison is down 2.63% for the year, due mostly to tight trailing stops which knocked us out of the market just before the market started to rebound.  In a trading range market the BDH strategy will have a tough time making progress, and will under perform, as it takes time to get back in the market with a Dashboard BUY signal from a previous Dashboard SELL signal.

Interestingly, the market internals have worsened with only 182 new 52-week highs on the NYSE compared to 600 new lows.   Note that only 38.88% of all NYSE stocks are above their respective 50-dmas, and only 43.03% are above their 200-dmas at week’s end.  These are not good numbers for a market near its highs.  This indicates the current stock market rally is being driven by a small number of stocks with excellent performance year-to-date.  Normally, the market will eventually give in and decline, but so far that has not happened.

For the week, the NASDAQ Composite advanced 0.78%, while the S&P 500 moved 1.16% higher, and the DJIA advanced 0.69%.

Bond prices rallied. Gold (GLD) prices and gold miners (GDX) did not do much overall.   Crude oil (USO) closed near its yearly lows.   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 –Two Changes NASI July 30 2015

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator remains on its new BUY signal of July 13.(Refer to first chart).

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD SELL signal on July 28 (refer to first chart).

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest July 29 Bullish Percentage reading was 21.1% down significantly  from the prior week’s reading of 32.5%.  Investors are now a much less bullish on the market projecting out six months. This indicator is still on a May 27 BUY signal, as well as its two recent confirming BUY signals as well.  A move about 25% would result in a third confirming BUY signal.  Remember this a contrary indicator. Low bullish extreme readings normally indicate a buying opportunity ahead.

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced a SELL signal on July 28, as the MACD had a negative crossover (see red arrow on bottom frame on second chart). 

Here is a chart showing all D   ashboard 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 “2” NEUTRAL Signal

The latest update is shown here:

Dashboard-V2-July 31 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 2.63%. The BDH strategy is slightly under performing the market so far this year.

Top 5 ETFs –  100% Invested

The portfolio is 20% invested. Since the last BUY signal on July 15th,  the BDH strategy is down 0.80% vs. a loss of 0.64 for the three major averages. Below is the link to  the current portfolio:

Top-5-ETF-Tracking-July 31-2015

The ETFscreen table containing 52 ETFs had only 11 ETFs with a “pass” rating this week which is a poor showing for a market that is near its highs for the year.  This indicates the market’s mixed performance where only selective stocks in specific sectors are participating in this market upswing. This is a market showing internal weakness, but experiencing a bounce up last week.

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 Moves Highers After Monday Sell-Off

The market internals are still weak and the average stock is not participating in this rally, but the market has rebounded nicely from its lows of July 7.   The BDH strategy is now only 20% fully invested which will further erode its performance going forward if the market continues to move higher from here.  Only a BDH BUY signal will allow the strategy to get back in tune with the short-term market trend, if it continues higher.

Be careful here as this is treacherous territory as the market tries to take out its previous highs — especially the S&P 500 which is having a very hard time breaking out above its resistance of 2130 which has been hit three times without a breakthrough (Use the symbol $spx in the first chart to see this). 

Remember that you are responsible for your investments and how you manage them.  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.  So to make sure you are following the signals please be pro-active so as not to miss any Dashboard signals.

Jul 25

Comp July 23 2015This will be an abbreviated blog post as in the norm every other week.

Market Review

The stock market took a hit this week.  In particular the NASDAQ Composite advanced to an all-time high intra-day on Monday (5231.94), but then headed down closing at 5088.63 on Friday, down 2.7% from its high point.  It now has breached two prior levels of support (two top horizontal blue lines on first chart) that have turned into resistance levels.  And it is only 1.4% from its critical 100-dma (refer to first chart).  If that level is breached on a closing basis any day next week, then the Dashboard will be at “2” NEUTRAL.

Indicator #8 had a wild week with first a BUY signal on July 21 and then a SELL signal on July 24 (refer to second chart).  There were 245 NYSE 52-week highs and 626 lows, not a good sign going forward.  For the week, all the major averages were down more than 2.2%.

NASI July 23 2015XLV in our Top 5 ETFs was sold on Friday at $75.08 after hitting its 3% trailing stop.  No new positions are being added at this time.

The latest Dashboard readings are at the following URL:

Dashboard-V2-July 23 2015_WC-1

Be very careful as the market could be on its way to its long awaited 10% correction.  Keep stops tight to protect principal in according with your personal risk tolerance.  Only 6 ETFs have a pass rating on ETFscreen, not a very good showing.
Stay cool!

Jul 18

Market Review COmp July 17 2015

The stock market’s strong start to this past week with two solid days resulted in the NASDAQ Composite’s two indicators (#2 and #5) giving BUY signals on July 13 and 14th respectively.  Not only was the 100-dma taken out easily, but the MACD crossover also occurred, all within a day of each other (refer to chart on the right).

Even Indicator #8 had the Index crossover it’s 5-day ema on July 14th.  However, we still need a MACD upward crossover on this indicator for confirmation.  When that occurs the Dashboard will be on a maximum “4” BUY signal (refer to second chart below).

Accordingly, this past Wednesday morning the  following Top 5 ETFs with a pass rating were purchased at the open: IBB (2), XLY (3), XLV (5), QQQ(7), and PDP (9) as reported in my interim blog post on July 14th.

The stock market continued to advance the remainder of the week, with the NASDAQ closing at an all-time high of 5210.14 up an astonishing 4.25% for the week and 300 points or 6.3% from its intra-day lows eight trading days ago.  Moreover, the S&P 500 advanced 2.41% for the week, followed by the DJIA gaining 1.84%.  The easing in the Greek situation helped the market recover from prior week weakness.

Interestingly, the market internals finally improved with 266 new 52-week highs on the NYSE compared to 115  a few weeks ago, while the number of new lows fell from 514 a few weeks ago to 281 last week.  Even with the markets surge these numbers are not encouraging.  Note that only 41.79% of all NYSE stocks were above their respective 50-dmas, and only 48% were above their 200-dmas.  These were big improvements from when market hit its lows on July 7.

For the year-to-date, the NASDAQ is up a solid 10.00% while the S&P 500 is up 0nly 3.29%, and the DJIA is up 1.48%.  The BDH strategy in comparison is down 0.99%.  The real leadership in this market has been the high tech companies, and healthcare including biotech.

Bond prices rallied. Gold (GLD) prices and gold miners (GDX) got crushed, closing at their lows for the year.   Crude oil (USO) was also lower for the past two weeks.  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 –Two Changes NASI July 17 2015

Indicator #2 NASDAQ Composite Index and 100-dma. This indicator remains on its new BUY signal of July 13.(Refer to first chart).

Indicator #5 NASDAQ Composite with MACD.  This indicator had an MACD BUY signal on July 14 (refer to first chart).

Indicator #6 AAII Weekly Investor Sentiment Survey Bullish Percentage. The latest July 15 Bullish Percentage reading was 30.8% up  from the prior week’s reading of 27.9%.  Investors are now a bit less bullish on the market projecting out six months. This indicator is still on a May 27 BUY signal.  and its two recent confirming BUY signals as well,

Indicator #8 NASI Summation Index and MACD. This indicator’s  Index experienced a positive Index crossover on July 14 (5-day EMA green arrow on top in second chart).  The MACD is nearing a positive crossover but is not yet there.

Here is a chart showing all D   ashboard 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-July 17 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 14th place out of 18 total strategies measured by the site with a year-to-date loss of 0.99%. The BDH strategy is slightly under performing the market so far this year. Since the last BUY signal this past week, BDH is up 0.84% vs. 0.98 for the three major averages.

Top 5 ETFs –  100% Invested

The portfolio is 100% invested.  Below is the link to  the current portfolio:

Top-5-ETF-Tracking-July 17-2015

The ETFscreen table containing 52 ETFs had only 18 ETFs with a “pass” rating this week which is a fair showing for a market that is near its highs for the year.  This indicates the market’s mixed performance where only selective stocks in specific sectors are participating in this market upswing. This is a market showing internal weakness, but experiencing a bounce up last week.

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 Moves Higher

The market internals are still weak and the average stock is not participating in this rally.  Nevertheless, the market has rebounded quickly from its lows of July 7. International financial events will most likely impact the market going forward, as will US economic, financial, and earnings announcements.  The BDH strategy is now fully invested which is a testament to the focus of the strategy which is to change direction as the market turns, whether the turn is up or down. Be careful here as this is treacherous territory.  Make sure stop limit orders are used to protect any profits.  The  BDH portfolio will be using 3% trailing stops to prevent against any big declines that usually occur in the July through early October time period.  Stops are subjective and investors should decide on their own parameters based upon their personal risk tolerance.

Remember that you are responsible for your investments and how you manage them.  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.  So to make sure you are following the signals please be pro-active so as not to miss any Dashboard signals.

Jul 14

Intra-week update

Market Situation COMP July 14, 2015

The stock market’s strong start to this week with two solid days resulted in the NASDAQ Composite’s two indicators (#2 and #5) giving BUY signals on July 13 and 14th respectively.  Refer to chart on the right.

Even Indicator #8 had the Index crossover it’s 5 day ema today.  However we need a MACD upward crossover for confirmation.  When that occurs the Dashboard will be on a maximum “4” BUY signal.  Refer to second chart.

NAWSI July 14, 2014Accordingly, on Wednesday morning the  Top 5 ETFs with a pass rating will be purchased at the open.  These are IBB (2), XLY (3), XLV (5), QQQ(7), and PDP (9).

A full blog will be provided this coming weekend.  Be careful as the market attempts to reach or exceed its recent yearly highs.

Jul 12

This will be an abbreviated update as is the case every other week.

Market ReviewComp July 10 2015

The situation in Greece had a major influence on the global markets last week.  The DJIA had intra-day moves of over 230 points on four days last week.  All-in-all  the markets closed most unchanged (less than 0.20% in wither direction) for the week with a Friday rebound.

The Monday rout resulted in a Dashboard SELL signal as indicator#2 fell below its 100-dma and stayed there for the remainder of the week.  Accordingly, our last ETF position, XLY, was sold on Tuesday at the open at $77.13.  Therefore, the BDH strategy is in a 100% cash position awaiting the next BUY signal.  Here is the latest Dashboard readings:

Dashboard-V2-July 10 2015_WC-1

There will be a full report next weekend.  Enjoy the summer!

 

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.