Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 02/18/2016

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, February 18, 2016

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If you are not familiar with some of the terminology used, please see the Glossary of Terms.

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: SELL — since 11/13/2015

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Our main directional indicator, the Domestic Trend Tracking Index (TTI-green line in above chart) has recently crawled above its long term trend line (red) and finally generated a new “Buy” signal effective 11/3/15. The market subsequently dropped, and we exited again on 11/13/15. As of today, the TTI remains below its trend line by -2.20%, which means we are in cash on the sidelines.

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Win Streak Snaps But Gold Muscles Higher

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks fell, capping the Dow’s winning streak at three days as continued volatility in oil prices was offset by a lowered sales outlook from retail giant and Dow component Walmart.

For the past three sessions, the market has been volatile like it has been for most of 2016. The only difference is the recent wild swings have been to the upside, with the Dow enjoying gains of 314, 223 and 257 points the past three sessions since hitting a bottom last Thursday. For the S&P 500 there is overhead resistance lurking around the 1,950 area, so we’ll have to wait and see if this glass ceiling holds and acts as a reversal point or if we’re able to break through it.

Some have called this rebound a “garbage” stock market rally as fundamentals are not in sync with higher prices and predominantly short covering, which I have alluded to, has produced the power for this upswing. Only time will tell if this was one big head fake or the resumption of the bullish trend.

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Short Covering Continues As Stocks Mount Three Day Win Streak On Oil Surge

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

At its low point just a few days ago, the Dow was down about 1,800 points (or 10%) for the year. However, over the past three trading sessions, it has regained over 750 points. Whether the rally marks the end of a painful correction is still to be determined though.

One of the big movers continues to be crude oil. The recent news of a potential cap proposed by Saudi Arabia, Russia and other nations has given a lift to oil prices. And while there’s no guarantee that a deal will be sealed, it is still a sign that the recent oil crash could now be playing out in favor of the markets.

It is all adding up to nothing but a “relief rally” that has slashed the Dow’s losses in half this year. And if the trend continues the bearish spell over on Wall Street may be limited, although I doubt it. If this all very confusing to you, ZH explained it this way:

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Stocks Power Higher Fueled By Short Covering

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks fared well and extended Friday’s short covering rally as traders returned from the long weekend and Wall Street reacted to news that Saudi Arabia, Russia, Qatar and Venezuela have agreed to cap crude production at January levels if other major producers, such as Iraq and Iran, follow suit. Of course, we have heard this story before as jawboning OPECers have yet to follow through on any recent agreement; so color me skeptical.

Sinking oil prices have been a major cause of financial market turbulence to start 2016, as it has caused sharp drops in both the share price and earnings of oil-related stocks that resulted in negative ripple effects around the globe, including rising fears of recession. The tentative move to support prices, as it requires buy-in from other oil-producing nations in the Middle East, is hoped to be a first-step towards stabilizing crude prices.

There was an interesting bit of news about Apple (AAPL) today. Apparently, the company plans to sell a series of bonds maturing as soon as 2018 and as far out as 2046. The move might seem curious since Apple has $216 billion in cash and investments in the bank. Analysts say it’s really a financial engineering move that allows the company to delay paying U.S. taxes. Apple had no long-term debt whatsoever as recently as the end of fiscal 2012 ended in September. It then piled on nearly $17 billion in fiscal 2013, added another $12 billion in fiscal 2014 and boosted debt an additional $24.5 billion in fiscal 2015.

All of our 10 ETFs in the Spotlight closed in the green as Consumer Staples (XLY) took the lead with +2.42%. With this being a risk-on day, it’s no surprise that Consumer Staples (XLP) lagged with +0.80%.

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ETFs/Mutual Funds On The Cutline – Updated Through 02/12/2016

Ulli ETFs on the Cutline Contact

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 381 ETFs, of which currently 41 (last week 40) are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher. Volume figures can change in a hurry, so be sure to check first before investing.

These ETFs are generated from my selected list of 98 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. 10 ETFs (last week 10) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 27 (last week 27) above the line and 753 below it out of the 780 that I follow.

Take a look:

  1. ETF Master Cutline Report
  2. ETF High Volume Cutline Report
  3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.

One Man’s Opinion: Should Investors Remain Defensive Right Now?

Ulli Market Review Contact

ManFederal Reserve chief Janet Yellen could have said more and should have said more during her Senate testimony, and she left the impression that she and the Fed are not in touch with the mother ship, said Robert Michele, head of fixed-income, currencies and commodities at JP Morgan.

Inflation expectations seem to be least of the Fed’s worries; a serious credit contraction is underway and Ms Yellen should acknowledge that. The Fed chief should look at the capital-base being wiped off the banks in the current downdraft in equities, which is not supposed to be happening right now; they are supposed to be bullet-proof.

Gold at $1200/ounce tells investors that in a flight-to-quality in a safe-haven, people have more confidence in gold than in bank deposits or paper money. It seems things have spiraled out of control, he noted.

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