Market Commentary – High Volume ETFs On The Cutline – Updated Through 7/27/2011

Ulli ETFs on the Cutline Contact

Continued uncertainty from the lack of progress in the debt ceiling talks pressured the markets, and the major indexes lost for the 3rd day in a row.

Not helping were a worse than expected durable goods orders report indicating that an economic slowdown may be indeed a possibility. That’s no surprise to me as I have been elaborating for some time on the theme that a stimulus induced ‘recovery’ simply does not have legs.

Yesterday’s drop did some technical damage in that the S&P 500 broke again below its 50-day moving average by -0.50%, but remains above its more important long-term 200-day average by +1.85%.

As I mentioned last Friday, our international Trend Tracking Index (TTI) had been doing the trend line dance by moving above and below it without clear direction. As of yesterday, the international TTI again closed below its trend line by -0.97%, which is in tune with our current position of not being invested in that market.

The expanded High Volume ETF Cutline report now includes all ETFs above and below the cutline (trend line). To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher.

These ETFs are generated from my selected list of some 90 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations.

Currently, there are 54 ETFs hovering above this dividing line between bullish and bearish territory (shown in yellow), while 34 of them are positioned below it.

Go ahead and review this expanded ETF table:

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6 ETF Model Portfolios You Can Use – Updated through 7/26/2011

Ulli Model ETF Portfolios, Uncategorized Contact

Worries about the debt ceiling battle in Washington kept the market subdued over the past 5 trading days, despite breakout attempts to the upside, which were supported by decent earnings reports. However, lack of follow through kept a glass ceiling on further advances.

The S&P 500 is up 5 points since last Wednesday’s ETF Portfolio report.

Our ETF Model Portfolios headed higher again but to varying degrees. Leading the pack on a YTD basis is the #1 Trend Tracking Portfolio with a gain of +7.04%, followed by the Aggressive Portfolio #3, which sports +6.90%.

Here are the changes for the past week:

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Expanded Report: Mutual Funds On The Cutline – Updated as of 7/25/2011

Ulli Mutual Funds On The Cutline Contact

As announced last week, the mutual fund cutline report has been expanded to show more funds that have broken above the cutline (trend line).

Currently, there are 793 funds in my data base, of which I am listing the first 250 that are hovering above the cutline. On the bear market side, or below the cutline, I am tracking 76, out of which the first 20 are shown.

This will help you to follow funds you are interested in as they cross the trend line into bullish territory and follow them as either their momentum numbers improve or, depending on market direction, they succumb and drop back below the line. If there is enough reader interest, I can further expand this report to show all 793 funds.

Take a look at this week’s mutual fund cutline report:

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NEW: Expanded ETF Master Cutline List – Updated through 7/22/2011

Ulli ETFs on the Cutline Contact

As recently announced, I have expanded the previously limited ETF Cutline list to include all funds featured in Thursday’s StatSheet, or more specifically the ETF Master List.

In this week’s report, there are 321 ETFs above the cutline (trend line) and 75 below it, of which 20 are listed. This new and expanded version will now make it very easy for you to follow those ETFs that have crossed their trend line to the upside and are improving their momentum numbers.

For example, if your are starting at the cutline on page 8 and are moving up, you will find the first  ETF with all positive momentum numbers and 0.00% in the DrawDown column (DD%) to be FXY in the +153 position. The next one would be QQQ in the +229 position and so on. Once you reach page 1, you’ll see several candidates with positive numbers across, but you’ll also notice that they have moved above their trend line (%M/A column) by considerable percentages.

As a result of the market having had an up week, more ETFs have improved their positions and momentum numbers during the past 5 trading days.

Take a look at this new expanded ETF Cutline report:

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Last Week In Review: ETF News And Blog Posts

Ulli ETF News Contact

In case you missed it, here’s a summary of the ETF topics that I posted to my blog during the week ending on 7/22/2011.

What the market lost two weeks ago, it made back during the last 5 trading days, putting us back to the level of where we were on July 8th, as far as the S&P 500 is concerned.

Despite the rally, global and domestic debt issues, especially the battle over raising the debt ceiling, may keep a lid on further market advances. However, I think a relief rally maybe in the cards, should a framework be put in place to quickly resolve this domestic issue prior to the August 2nd deadline.

My published Cutline tables and Model ETF Portfolios can give you an assist by indentifying weakness and strength in various market segments so that you can make better investment decisions by avoiding exposure in those areas that are trending down.

This week, we covered the following:

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Downside Portfolio Protection

Ulli Sell Stops Contact

The Street featured an article titled “Simple Ideas for Downside Portfolio Protection.”

As I read it, I got the distinct feeling that there was not much conviction behind the suggestions.

I have seen similar articles with the same topic before, and they all appear to say “yes, you can do these things, but…” And the big “but” is this: “While you will lose less money in a bear market implementing these suggestions, you will miss out on most of the upside when the market recovers.”

As if that is the worst thing that could happen to you. I wonder if any of these writers ever put a pencil to the task and analyze if what they are saying really makes sense.

Let’s look at the 3 examples from the above article, and I will calculate the numbers for you. You will be amazed at the outcome:

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