After another wild week in the markets, with a downward bias, the number of ETFs residing above the cutline has been reduced again, which is no surprise. At this point, there are only 36 ETFs positioned in Bull Market territory, above the Cutline, while 360 ETFs are stuck on the Bear Market side.
Leading the pack are the precious metals, followed by long-term/intermediate government bonds, indicating the flight to safety is still on.
Take a look at the latest report:
[If you are not familiar with some of the terminology used, please see the Glossary of Terms.]
If things get even worse, we may end up with even fewer ETFs above the line. Long-term that would be a good thing, as bearish forces will eventually end, and the bulls will get the upper hand. That will be the time, when the cutline will be most beneficial as you can follow ETFs crossing to the upside, which offers you the opportunity to get on board early.
Again, that is the long-term benefit. This is not the time to be a hero and engage in bottom fishing as the trends clearly point down. Right now, you need to step back and let this situation play out until better opportunities present themselves.