- Moving the markets
An early rebound faltered, and the major indexes declined below the unchanged line but managed to crawl back into positive territory to close out the month with solid gains. The Dow added +5.8%, its best January since 1997, while the S&P 500 and Nasdaq rallied +5.6% and +7.4% respectively. The culprit for the weakness was the Fed hinting that it is “set to raise interest rates as early as its next meeting in March.”
As a result, bonds were spooked with the 10-year yield bouncing to 2.74%, which is its highest level since early 2014, but closing at 2.72%. In the end, equities closed mixed along with our ETFs. Emerging markets (SCHE) were the clear leader with a solid gain of +1.26%, which was closely followed by Semiconductors (SMH +0.84%). Closing in the red were US SmallCaps (SCHA -0.50%) and International SmallCaps (SCHC -0.10%).
Gold and Crude Oil both closed up, but the US Dollar (UUP) lost another -0.13% and had its worst January since 1987.
- 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 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 our 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) slipped with the markets presenting a mixed picture.
Here’s how we closed 1/31/2018:
Domestic TTI: +4.70% above its M/A (last close +4.71%)—Buy signal effective 4/4/2016
International TTI: +8.16% above its M/A (last close +8.30%)—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.
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