Drifting Nowhere

[Chart courtesy of MarketWatch.com]

  1. Moving the Markets

I did not except much market movement ahead of the Fed’s interest rate decision on Wednesday, and that’s exactly what happened as the major indexes vacillated in a tight range ending little changed on low volume.

Behind the scenes, some divergence has become apparent as the number of S&P companies above their 50-day M/A have turned lower indicating weakening momentum. The same reversal is noticeable when looking at the number of S&P companies above their 200-day M/A.

The US dollar slipped giving support to gold, and the 10-year Treasury yield spiked to 2.62%, its highest since December 2015. Should this continue and rates move towards the 3% level, there will be some fallout in the equities arena. Interest rates can’t simply race higher forever without consequences. The danger zone, as I have posted before, is between 2.6% and 3%, which is the area many top hedge fund managers are watching. Stay tuned…

  1. ETFs in the Spotlight (updated for 2017)

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

It features 10 broadly diversified and sector ETFs from my HighVolume list as posted every Saturday. 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.

The below 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 2017 candidates have fared so far:

Again, the %M/A column above shows the position of the various ETFs in relation to their respective long term trend lines, while the trailing sell stops are being tracked 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.

  1. Trend Tracking Indexes (TTIs)

Our Trend Tracking Indexes (TTIs) headed higher despite the major indexes drifting aimlessly.

Here’s how we closed 3/13/2017:

Domestic TTI: +2.76% (last close +2.68%)—Buy signal effective 4/4/2016

International TTI: +5.79% (last close +5.64%)—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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