Earnings And Oil Assist The Markets


[Chart courtesy of MarketWatch.com]

1. Moving the Markets

The major indexes rallied moderately supported by better-than expected quarterly results from Morgan Stanley along with oil prices, which gained over 2% and are nearing their 15-month high.

And again, data points confirmed sluggishness in the economy as shown by weak housing data and a disappointing outlook in the tech area, which kept the Nasdaq hovering around the unchanged line all day.

Of course, all eyes are on tonight’s final Presidential debate, which contributed to the markets being in “subdued” mode. With the daily economic data flow coming in mostly to the downside, it clearly shows that the level of the S&P 500 does not represent the true economy, but GDP numbers do. ZH posted this spot-on chart for reference:


The question remains as to whether GDP will pick up and rise to the level of the S&P or will the S&P head towards the GDP level. I think the latter will be the case, which in my mind is only a matter “when” and not “if”.

2. ETFs in the Spotlight

In case you missed the announcement and description of this section, you can read it here again.

It features 10 broadly diversified ETFs from my HighVolume list as posted every Monday. Furthermore, they are screened for the lowest MaxDD% number meaning they have been showing better resistance to temporary sell offs than all others over the past year.

Here are the 10 candidates:


The above table simply demonstrates the magnitude with which some of the ETFs are fluctuating in regards to their positions above or below their respective individual trend lines (%M/A). A break below, represented by a negative number, shows weakness, while a break above, represented by a positive percentage, shows strength.

For hundreds of ETF choices, be sure to reference Thursday’s StatSheet.

Year to date, here’s how the above candidates have fared so far:


Again, the first table above shows the position of the various ETFs in relation to their respective long term trend lines (%M/A), while the second one tracks their trailing sell stops in the “Off High” column. The “Action” column will signal a “Sell” once the -7.5% point has been taken out in the “Off High” column.

3. Trend Tracking Indexes (TTIs)

Both of our Trend Tracking Indexes (TTIs) inched up as oil provided an assist in keeping the markets above the unchanged line.

Here’s how we closed 10/19/2016:

Domestic TTI: +1.60% (last close +1.50%)—Buy signal effective 4/4/2016

International TTI: +3.66% (last close +3.28%)—Buy signal effective 7/19/2016

Disclosure: I am obliged to inform you that I, as well as my advisory clients, own some of the ETFs listed in the above table. Furthermore, they do not represent a specific investment recommendation for you, they merely show which ETFs from the universe I track are falling within the guidelines specified.

About Ulli Niemann

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