ETF/No Load Fund Tracker Newsletter For Friday, October 11, 2013

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ETF/No Load Fund Tracker StatSheet

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THE LINK TO OUR CURRENT ETF/MUTUAL FUND STATSHEET IS:

https://theetfbully.com/2013/10/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-10102013/

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Market Commentary

Friday, October 11, 2013

TRADERS ENTERING THE WEEKEND ON HIGH HOPES

Domestic equity markets were able to extend their recent gains today, continuing a major rally in the previous session amid growing optimism that a solution to the budget and debt ceiling concerns may be delivered soon as negotiations continue on Capitol Hill.

The Dow Jones Industrial Average closed 111 points higher (0.7%) at 15,237, the S&P 500 Index gained 11 points (0.6%) to 1,703, and the Nasdaq Composite increased 31 points (0.8%) to 3,792. Elsewhere, treasuries were nearly unchanged on the heels of a larger-than-forecasted decline in U.S. consumer sentiment. Bond markets will be closed on Monday in observance of Columbus Day. Meanwhile, gold and crude oil prices were lower, while the U.S. dollar was flat.

In earnings news, Dow member JPMorgan Chase topped analysts’ expectations after excluding a large legal expense, while Wells Fargo exceeded analysts’ bottom line projections, but its revenues were bogged down by lower mortgage-related activity. The financial sector (+0.6%) ended in-line with the S&P.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 10/10/2013

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ETF/Mutual Fund Data updated through Thursday, October 10, 2013

Table of Content082312

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

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: BUY — since 10/25/2011

TTI

The Domestic TTI broke through its long-term trend line generating a Sell for this area effective 8/9/2011. Over the recent past, we’ve seen the TTI hovering slightly below and above this dividing line between bullish and bearish territory. The clear break to the upside occurred on 10/24/11 and, effective 10/25/11, a new Buy signal for domestic equities went into effect.

As of today, our Trend Tracking Index (TTI—green line in above chart) has bounced off its long term trend line (red) by +2.75% after briefly dipping below it late in June 2013.

To avoid a potential whip-saw, a Sell signal to move out of all domestic equity positions will be generated once we have clearly pierced the line to the downside. Be sure to tune in for the latest updates.

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Bulls Out In Force

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Thur pic

[Chart courtesy of MarketWatch.com]

Domestic stock markets surged to close at the highs of the day, marking the second-best single day gains year-to-date, on signs that the fiscal stalemate on Capitol Hill may be beginning to thaw. The Dow rocketed over 300 points while the market rally left the S&P 500 less than 2 percent away from its record closing high set three weeks ago.

Traders now focus on an earnings season that begins in earnest on Friday with results from top banks JPMorgan and Wells Fargo. The eased fiscal concerns overshadowed a sharp increase in domestic initial jobless claims, which were impacted by technical issues in California and out-of-work non-federal workers due to the government shutdown.

Equities registered the bulk of their gains at the open amid indications the budget stalemate may be getting a bit closer to a resolution. Participants rushed into equities after House Republicans proposed extending the debt limit by six weeks in order to allow for a broader discussion on spending.

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There Is Light At The End Of The Tunnel

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Wed pic

[Chart courtesy of MarketWatch.com]

Domestic equities bounced off of session lows, rebounding from the benchmark index’s biggest two-day slump since June, with the Dow and S&P 500 gaining modest ground while the Nasdaq finished lower for a third day, pressured as investors sold this year’s winning tech stocks including Netflix and Fastenal. Traders were skeptically optimistic following the nomination of Federal Reserve Vice Chair Janet Yellen for Fed Chairman and news that President Obama will meet with lawmakers on Thursday to discuss the debt ceiling and budget impasse, now in its ninth day.

Equities began the session with slim gains, however, given the expected nature of the Fed Chairman announcement, the early boost faded quickly. The major averages appeared on their way to another losing session, but found support during late-morning trade when the Dow Jones Industrial Average tested its 200-day moving average (14,728) for the first time this year.

On a related note, the financial sector (+0.3%) finished ahead of the remaining cyclical groups while other growth-sensitive areas were a bit more mixed. On the downside, the discretionary sector (-0.4%) lagged throughout the session as quick service restaurants displayed weakness after Yum! Brands reported disappointing earnings and made cautious comments about its operating environment going forward.

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7 ETF Model Portfolios You Can Use – Updated through 10/8/2013

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With the government shutdown now in its 9th day, with no apparent resolution in sight, the markets have become nervous with the S&P 500 giving back almost 2.5% since last week’s ETF Model Portfolio report.

While our main directional gauge, the Domestic TTI, still remains on the bullish side of the trend line by +1.85%, this is as good a time as any for you to revisit and indentify your trailing sell stops. If history is any indication, this budget impasse will come to a resolution at some point. Once it does, there is a good chance that a relief rally will be in our future.

However, nothing is certain, and politicians certainly could push this gridlock further down the road, which then may have dire consequences for the markets. So, it pays to be prepared. For me, the line in the sand is a clear break of our Domestic TTIs long-term trend line to the downside, which would generate an all-out ‘Sell’ for broadly diversified domestic equity funds/ETFs. Please stay tuned for the latest updates.

In the meantime, here’s the latest ETF Model Portfolio update:

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Major Index ETFs Drown In Fiscal Uncertainty

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Tue pic

[Chart courtesy of MarketWatch.com]

U.S. equities extended yesterday’s solid losses as a gauge of Wall Street anxiety hit its highest level in more than three months with equity markets showing growing concern over no indication of progress from lawmakers on budget and debt ceiling negotiations.

A disappointing debt auction of one-month Treasury bills, which saw the rate almost triple the borrowing costs seen last week, added fuel to the fire, as Treasuries finished mostly lower, with the short-end of the curve seeing the brunt of the pressure amid the fiscal stalemate. Moreover, the government shutdown continues to impede on investors getting pertinent economic data, with the only item on the docket showing a slight decline in business sentiment.

Traders cashed in gains in some of the year’s best performers. The Nasdaq Composite was the biggest loser today, sliding 2.0%.  The cracks in leading names like LinkedIn, Priceline.com, Yahoo and Facebook provided an added cue for buyers to stick mostly to the sidelines. An index of Internet stocks tumbled the most in almost two years, sinking 4.1 percent.

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