New Quarter—Same Old Problems

The bullish crowd got a scare Tuesday morning as this quarter started out with the Dow sinking by as much as 167 points with the other major averages in close pursuit. GM proved to be the savior of the day with better-than-expected sales reports for June, and the markets ended up closing in plus territory.

As much as the bulls are hoping this to be rally with legs, most likely it was just simply short-covering off a much oversold market. The problems of the year (low dollar, high oil prices and weak financial stocks) have not gone away and will most likely haunt the averages for some time to come.

Yesterday’s rebound had only a slight effect on our Trend Tracking Indexes (TTIs), which are now positioned as follows:

Domestic TTI: -1.47%
International TTI: -10.63%

As you know, we hedged our mutual fund positions (rather than selling them) on June 12 and as of yesterday that hedge has gained +1.21%. As time goes on, I’ll be reporting more from our continued hedging efforts using mutual funds and ETFs.

About Ulli Niemann

Ulli Niemann is the publisher of "The ETF Bully" and is a Registered Investment Advisor. Learn more
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