ETF/No Load Fund Tracker Newsletter For December 5, 2014
ETF/No Load Fund Tracker StatSheet
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THE LINK TO OUR CURRENT ETF/MUTUAL FUND STATSHEET IS:
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Market Commentary
Friday, December 5, 2014
BULLS REMAIN IN FULL FORCE TO CLOSE OUT THE WEEK
1. Moving the Markets
The Dow and S&P 500 closed the week higher on strong economic data. The Dow, closing today at 17,958.79 (another record high), is making a run at hitting 18,000 for the first time in history. The domestic economy continues to gain momentum as we approach the New Year, as was reinforced by another strong jobs report today alongside robust readings from the ISM manufacturing and nonmanufacturing indexes.
Employers added 321,000 jobs in November, the largest one-month gain in more than two years, the Labor Department said. Those numbers, which kept the jobless rate steady at 5.8%, far exceeded most economists’ expectations of 225,000 new jobs.
Starbucks (SBUX) continued to power forward to an-all time high today as the coffee shop icon debuted a huge flagship Starbucks store in its hometown of Seattle. If you remember from earlier this week, Starbucks has unrolled plans for a change in business strategy that entails price increases, as well as serving alcoholic beverages. The shift in consumer presence in malls to online shopping has decreased in-store sales, thus the company is making adjustments all while trying to double its revenue by 2019.
It is an extremely quiet week for economic data. Most of the attention will be on the Thursday retail sales report, giving an early indication of how the month of November fared. While early reports showed somewhat disappointing Black Friday sales, expectations are for retail sales excluding gas prices to have increased 0.5% in November from October.
9 of our 10 ETFs in the Spotlight edged higher today; 3 of them made new highs as the YTD table below shows.
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.
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)
Our Trend Tracking Indexes (TTIs) were mixed and changed only slightly closing the week as follows:
Domestic TTI: +3.46% (last Friday +3.70%)—Buy signal since 10/22/2014
International TTI: +1.62% (last Friday +1.54%)—New Buy signal effective 11/24/14
Have a nice weekend.
Ulli…
Disclosure: I am obliged to inform you that I, as well as advisory clients of mine, own some of these listed ETFs. 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.
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READER Q & A FOR THE WEEK
All Reader Q & A’s are listed at our web site!
Check it out at:
http://www.successful-investment.com/q&a.php
Reader Ira:
Q: Ulli: I know we got whipsawed a bit earlier last month. I pulled out and stayed out up to now. I was wondering… when you go back in after that kind of buy-sell-buy switch, how do you transition back into the market? I personally still see lots of danger signals, but as you noted multiple times- with the different govt’s interfering in the markets, all bets are off.
So, I was wondering how you went back in and what % invested you might be now. Also- are there any sectors that might be holds even in a sell signal (like Health…)?
Thanks and best regards.
A: Ira: I posted about my process of getting back into the market after the Domestic TTI signaled a ‘Sell.’ As the TTI rebounded and crossed back above its long-term trend line, I waited a few days to make sure the crossing was holding up. It appeared that way as, after a few days of meandering, the TTI broke the +1% level, which created a new Buy signal effective 10/22/14. I reinvested about 50-60% of available assets (100% for small accounts under $15k). About a week later, the momentum was still up, so I invested the balance giving us a 100% market exposure.
When markets turn bearish, usually all sectors will be affected. As much as I like Healthcare (XLV), I ended up selling it, capturing some profits, and later buying it again. I don’t believe there is any fund/ETF that you should hold during a ‘Sell,’ however, once we drop into bear territory, we may discover upward momentum in certain areas, which I plan on taking advantage of. But it’s too early to tell ahead of time; we have to get there first before we can make that determination.
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