- Moving the markets
For a change, the major market indexes managed to move higher in sync with the Nasdaq (QQQ) successfully bouncing off its 4-month trend line to close solidly in the green. News reports that the latest trade talks with China had resolved nothing pulled the indexes off their mid-day highs but kept them above their respective unchanged lines.
The gains were broad with 8 of the primary 11 S&P sectors closing higher with the leaders being healthcare (XLV) and industrials adding 1% and 2.1% each.
Quarterly earnings reports remain front and center and while the “beats” are garnering most of the attention, there is still the dark cloud of “trade talks” lurking in the background threatening to disrupt upward momentum at any time.
However, as I am writing this, Apple’s earnings have been released, and they hit an all-time high on services and offered “stellar” guidance pushing its stock price up by some 4% in after hours trading. That should help giving a boost to the Nasdaq tomorrow.
For the month, all major indexes ended in the green with Transportations (IYT) leading the way while SmallCaps and the Nasdaq were the laggards, the latter of which was severely impacted by the crashes of FB and NFLX.
- 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 regarding 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 -8% point has been taken out in the “Off High” column. For more volatile sector ETFs, the trigger point is -10%.
- Trend Tracking Indexes (TTIs)
Our Trend Tracking Indexes (TTIs) moved higher as the major indexes closed out the month on a high note.
Here’s how we closed 07/31/2018:
Domestic TTI: +2.02% above its M/A (last close +1.81%)—Buy signal effective 4/4/2016
International TTI: +1.02% above its M/A (last close +0.80%)—Buy signal effective 7/26/2018
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