Monday’s moderate sell off spilled over into Tuesday, until late buying set in—but only the Dow ended up recouping all intraday losses by closing in positive territory.
It was a day that could have ended up really ugly as a menu of negative news ranging from weakness in housing, the selling of financial and technology stocks along with higher oil prices pulled the markets lower before the bungee effect catapulted the averages out of the doldrums. Even the increased probability of GM’s bankruptcy did not break the mid-day recovery.
After yesterday’s close, here’s where Trend Tracking Indexes (TTIs) ended up in respect to their long-term trend lines:
Domestic TTI: -0.69%
International TTI: +2.17%
Hedge TTI: +2.81%
We are maintaining our domestic hedges and have invested in the international arena. Our trailing sell stops are set, and we now need to wait and see if more upward momentum can be generated or if the upcoming dog days of summer are keeping a lid on further advances.
Comments 5
Ulli,
Can you elaborate on what a stop means for recently purchased International funds/ETF’s?
Is it ~7% below the recent fund/ETF high price or is it ~1.5% below the 39 Week moving average?
Thanks,
Paul
Paul,
If a buy a fund/ETF at $10 and it rallies to 10.50 before sinking lower, then 10.50 becomes the high price since I bought this fund/ETF. The 7% trailing sell stop is calculated from this number until the market rallies above it.
The highest price since my purchase becomes the basis for figuring the sell stop.
Ulli…
Hej Ulli
Is the sell stop then 9.76?
(sorry for the dumb question)
Paul,
In that example, yes, it would be 9.76.
Ulli…
Thanks SO much Ulli !!!! (actually this is Chris…was in a hurry yesterday but read your blog daily!)
Chris