- Moving the Markets
The trading day started out on a sour note with the major indexes heading south as tech weakness dragged all sectors down for the second day in a row. Things stabilized mid-day, after which we headed south again, but the usual last hour ramp kept losses to a minimum for the Dow and S&P, but the Nasdaq gave back another -0.52% with Apple dropping another -2.39% on top of Friday’s -3.9% loss.
Causing these issues were the FAANG stocks (Facebook, Apple, Amazon, Netflix, Google), which showed downright meteoric rises since the election to reach extreme valuation levels. In fact, these 5 stocks were responsible for generating 40% of the S&P 500’s gains this year, an astonishing number that clearly demonstrates the lack of breadth accompanying this recent rally. In other words, a correction was long overdue.
In regards to interest rates, the widely followed 10-year T-bond ended the day unchanged yielding 2.21%. The US dollar, as represented by UUP, dropped by a slight -0.16% reversing a 3-day rebound. Precious metals were mixed with gold slipping -0.20% while silver fared worse by surrendering -1.47%.
- 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.
- Trend Tracking Indexes (TTIs)
Our Trend Tracking Indexes (TTIs) retreated as the Nasdaq took another hit.
Here’s how we closed 6/12/2017:
Domestic TTI: +3.52% (last close +3.67%)—Buy signal effective 4/4/2016
International TTI: +7.30% (last close +7.83%)—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.Contact Ulli