More Records

[Chart courtesy of MarketWatch.com]

  1. Moving the markets

In a repeat from yesterday, the Dow and S&P 500 climbed into record territory for the fourth session a row, while the Nasdaq bucked the trend and slipped a tad. While tomorrow’s announcement by the Fed about a 0.25% rate hike is a foregone conclusion, some anxiousness prevails about what signals may be given about 2018 and how the Fed views the economic conditions.

While MSM did not cover much in regards to the eruption of US Producer prices, at the fastest pace in six years, it nevertheless was a big headline with a year over year surge of 3.01%. Energy played a big role with final demand climbing 4.6%.

In ETF space, the numbers were mixed but fairly balanced. Gaining strongly were Financials (XLF) with +1.00% followed by Aerospace & Defense (ITA) with +0.36%. With the Nasdaq slipping, it was no surprise that Semiconductors (SMH) fell as well and lost -0.98% with Emerging Markets (SCHE) giving back -0.58%.

The yield on the 10-year bond rose 1 basis point, Crude Oil took a hit and gold desperately tried to climb above the $1,350 level but failed. The US Dollar (UUP) continued its recent rebound for the seventh straight day and is now solidly entrenched above its 50-day M/A.

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Dow And S&P 500 March Into Record Territory

[Chart courtesy of MarketWatch.com]

  1. Moving the markets

All 3 major indexes started the week in rally mode and finished solidly in the green, but only the Dow and S&P 500 set new record highs despite the Nasdaq scoring the best. The NY city terrorist incident disrupted the bullish mood only briefly, and the rally resumed. The main focus for traders was the Fed’s two-day meeting on interest rates with the results to be released on Wednesday. Expectations are just about 100% that they will deliver their third and last rate hike (1/4%) for 2017.

The ETF space I follow saw more green than red numbers. On the plus side, Emerging Markets (SCHE) ruled with a gain of +0.66%, which was closely followed by Semiconductors (SMH) with +0.61% and LargeCaps (SCHX) with +0.30%. Aerospace & Defense (ITA) gave back -0.67% along with Transportations (IYT), which surrendered -0.25%.

Interest rates headed north with the 10-year bond yield climbing 1 basis point. Gold slipped and Crude Oil gained +1.15%. The US dollar (UUP) round tripped and managed to cut its mid-day losses to end the session unchanged.

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One Man’s Opinion: A Young Foreigner’s First Impressions Of America

By Simon Black

Last weekend while I was in Denver, I had the opportunity to speak with a young man from the Netherlands who was attending our charity event.

It was his first trip to the United States, and I’m always interested to hear people’s first impressions.

He told me he was really overwhelmed with the size and scale of everything. China is about the only other country in the world that does everything as big as the US.

He also told me he couldn’t get over how much stuff there is to buy in the US… and how easy it is.

He’s absolutely right. The US is an amazing place for a number of reasons; it’s modern, generally safe, and boasts a high standard of living.

And, yes, as a consumer, it’s one of the best places in the world.

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ETFs On The Cutline – Updated Through 12/08/2017

Below please find the latest High Volume ETFs Cutline report, which shows how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs are positioned.

This report covers the HV ETF Master List from Thursday’s StatSheet and includes 366 High Volume ETFs ETFs, defined as those with an average daily volume of more than $5 million, of which currently 250 (last week 258) are hovering in bullish territory. The yellow line separates those ETFs that are positioned above their trend line (%M/A) from those that have dropped below it.

Take a look:

The HV ETF Master Cutline Report                               

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.

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ETF Tracker Newsletter For December 8, 2017

ETF Tracker StatSheet

http://www.theetfbully.com/2017/12/weekly-statsheet-etf-tracker-newsletter-updated-12072017/

 NEW RECORDS POWERED BY JOBS REPORT

 

[Chart courtesy of MarketWatch.com]

  1. Moving the markets

The headline report about the latest jobs numbers showing an improvement in November, 228k created vs. 200k expected, was enough to power the major indexes higher with both the Dow and S&P 500 ending the week in record territory. The tech sector closed down for the second week in a row.

Never mind that Consumer Confidence tumbled for the second month in a row. Never mind that wage growth disappointed and never mind that the bulk of the job growth took place in minimum-paying jobs.  And yes, in case you were wondering, waiters and bartenders did hit a new all-time high of 11.783 million in November.

None of that was relevant as we’re back to the “any news is good news” scenario. Of course, our ETF space benefited as we saw all green numbers with only one exception. Heading the winners were the Emerging Markets (SCHE) with +1.03%, followed by Financials (XLF) with +0.61% and MidCaps (SCHM) with +0.59%. Not participating in this rally were Semiconductors (SMH), which gave back -0.46%.

Interest rates rose modestly with the yield on the 10-year bond adding 1 basis point to close the week at 2.38%, while the more volatile high-yield sector (HYG) held steady. Gold slipped again and lost -2.5% over the past 5 trading days, which was its biggest drop in 7 months. The US Dollar (UUP) added +0.16% and had its first 5-day win streak since March.

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Weekly StatSheet For The ETF Tracker Newsletter – Updated Through 12/07/2017

ETF Data updated through Thursday, December 7, 2017

Methodology/Use of this StatSheet:

  1. From the universe of over 1,800 ETFs, I have selected only those with a trading volume of over $5 million per day (HV ETFs), so that liquidity and a small bid/ask spread are assured.
  2. Trend Tracking Indexes (TTIs)

Buy or Sell decisions for Domestic and International ETFs (section 1 and 2), are made based on the respective TTI and its position either above or below its long-term M/A (Moving Average). A crossing of the trend line from below accompanied by some staying power above constitutes a “Buy” signal. Conversely, a clear break below the line constitutes a “Sell” signal. Additionally, I use a 7.5% trailing stop loss on all positions in these categories to control downside risk.

  1. All other investment arenas do not have a TTI and should be traded based on the position of the individual ETF relative to its own respective trend line (%M/A). That’s why those signals are referred to as a “Selective Buy.” In other words, if an ETF crosses its own trendline to the upside, a “Buy” signal is generated. Since these areas tend to be more volatile, I recommend a wider trailing sell stop of 7.5% -10% depending on your risk tolerance.

If you are unfamiliar with some of the terminology, please see Glossary of Terms and new subscriber information in section 9.

                           

  1. DOMESTIC EQUITY ETFs: BUY — since 4/4/2016

Click on chart to enlarge

Our main directional indicator, the Domestic Trend Tracking Index (TTI-green line in the above chart) is positioned above its long-term trend line (red) by +3.39% after having generated a new Domestic Buy signal effective 4/4/2016 as posted.

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