Struggling To Defend Records

[Chart courtesy of MarketWatch.com]

  1. Moving the Markets

While the Dow managed to eclipse the 23k milestone marker intra-day, it was not able to hold this level into the close by falling 3 points short. Nevertheless, the record is in the books with the Dow notching its 4th 1,000 point climb in the past 12 months—the most ever in a calendar year.

Unbridled optimism about Trump’s tax plan remains the main focus, despite absolutely no assurances that it will have the support to be implemented and actually executed. But those appear to be minor details also brushed aside by an alleged improving economic outlook along with positive corporate earnings.

Be that as it may, the major trend continues to be up, and we will stay on board until that fact changes. Despite the Dow’s glitter, the actual performance of the major indexes was mixed at best. In ETF space, the gains were sparse with only the Dividend ETF (SCHD) and LargeCaps (SCHX) adding +0.4% and 0.3% respectively. On the downside, Emerging Markets (SCHE) took the lead with -0.47% followed by Transportations (IYT) with -0.37%.

Gold took a dive and surrendered not just -1.22% but also gave back its $1,300 marker. Interest rates were mixed but the 20-year bond (TLT) managed to eke out a +0.13% gain. The US dollar (UUP) round tripped by rallying sharply at first and then giving back most of its gains, but it still managed to end the session up +0.25%.

  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) again were mixed and changed only by a tiny margin:

Here’s how we closed 10/17/2017:

Domestic TTI: +3.15% (last close +3.17%)—Buy signal effective 4/4/2016

International TTI: +6.90% (last close +7.09%)—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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