ETF/No Load Fund Tracker Newsletter For Friday, January 24, 2014

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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/2014/01/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-01232014/

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Market Commentary

Friday, January 24, 2014

STOCKS TAKE A BEATING THIS WEEK

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving The Markets

Well, it was a poor end to a mediocre week in the U.S. stock market. U.S. stocks experienced their largest daily drop of the year with the S&P falling 2.09%, the Dow -1.96% and the Nasdaq -2.15%. The chart above shows the impact of the entire last five trading days. This officially marks the worst week for benchmark indexes since 2012. What is going on?

Many analysts place the blame on increased volatility in global markets, which sparked a large sell-off of developing-nation currencies. The Volatility S&P 500 (VIX) index was up 31% today, which adds fuel to the ‘anticipated volatility’ fire. Major markets in Europe and Asia also closed lower and remember that we also had weak growth numbers come out of China yesterday.

Others say that this is the correction we have been waiting for. Let us not forget the old saying “as goes January, so goes the year.” With only five days of trading left this month and with the S&P down 50 points (-3%) the old January effect saying might indicate that we are in for a rough ride this year. This should make for an interesting next week of trading; it is crucial that you have your exit strategy in place and execute your plan should your sell stops get triggered.

Our 10 ETFs in the Spotlight headed south but none of them triggered a “Sell,”, although some have come close as the table below shows.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 01/23/2014

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, January 23, 2014

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

Our main directional indicator, the Domestic Trend Tracking Index (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 TTI (green line in above chart) has bounced off its long term trend line (red) by +3.90%.

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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Major Indexes End In The Red Zone; A Good Day For Netflix

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving The Markets

U.S. equities closed in the red zone today amid sub-par economic data from China. Microsoft and Starbucks experienced notable gains (after hours) after releasing favorable updated company earnings data.

One of Thursday’s largest gainers was Netflix Inc. (NFLX). The stock gained 16% (from $333 to $388) on the day after releasing internal data on the company’s projected customer growth. Netflix’s CEO is also rumored to be testing new pricing strategies that would essentially charge customers more if they want to share their account with others. The rumored pricing change would increase revenue and profits, which was a bullish sentiment for the stock as it traded today.

China was back in the news today as word spread that the country’s manufacturing sector will experience an unanticipated contraction for the month of January. However, many investors are somewhat reluctant to read too deeply into the number, given that the Chinese spring festival (i.e. lunar New Year) is just around the corner. If you are not familiar with China’s spring festival, the country literally shuts down business operations for a 10-day period while tens of millions of people travel back home to celebrate with their families. For example, Beijing, a city with population of roughly 20 million, normally sees about 40% of its inhabitants exit the city during the holiday.

Our 10 ETFs in the Spotlight slipped along with the indexes but remain on the bullish side of the trend line:

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Icahn Proposes Ebay Paypal Split; Outlook For Mining ETFs

Ulli Market Commentary Contact

WEd pic

[Chart courtesy of MarketWatch.com]

1. Moving The Markets

The Nasdaq hit a new 13-year high today, while the S&P posted modest gains and the Dow fell about 0.3%. IBM’s (IBM) 3% drop was a heavy blow to the Dow. Today was a great day for eBay (EBAY), Netflix (NFLX) and F5 Networks (FFIV) after releasing their quarterly earnings for Q4 2013. Overall, it seems investors are still playing the equity markets in a conservative manner as they await Q4 earnings to come in for a majority of companies.

Shares of eBay jumped as high as 12% in post-close trading today after influential shareholder Carl Icahn made a statement that he is considering splitting the eBay (EBAY) and PayPal corporate structure. Ebay is by no means in financial trouble. In fact, just today they reported that revenue and earnings grew in Q4 of 2013 and a significant stimulant for the growth was its payment business, PayPal. However, Icahn was not shy to say that the company has not performed at its full potential due to the fact that ebay and PayPal operate under the same roof.

In ETF news, PureFunds made a decision to shut down two mining ETFs: PureFunds ISE Diamond/Gemstone ETF (GEMS) and PureFunds ISE Mining Service ETF (MSXX). As we all know, 2013 was tough for mining ETFs and things are not looking great thus far in 2014 given the fact that Europe is on the rebound, the dollar is stronger and the Fed is moving forward with their proposed tapering. While mined commodity ETFs will likely suffer in the near future, it may surprise you to know that the Market Vectors Gold Miners ETF (GDX) has still managed to gather a huge asset base of $4.3 billion. GDX has returned about 10% so far in 2014, but keep in mind that it was a disastrous pick in 2013.

Our 10 ETFs in the Spotlight followed the sideways theme of the week and changed only slightly.

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Stocks Remain Flat; China’s GDP Numbers Are In

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving The Markets

Major indices once again closed in mixed fashion with the S&P 500 gaining just 0.29%, the Dow dropping 0.27% and the NASDAQ gaining 0.68%.  After today’s small gain, the S&P 500 is down 0.2% for the year. However, remember that a flat market is much better than a falling market!

We received China’s fourth quarter GDP numbers today, which showed alleged growth of 7.7% for 2013. This lands above the Chinese government’s target of 7.5% and, while this number doesn’t entail much of a wow factor, we must remember that the Chinese government has made a concerted effort to actually cool growth, particularly for real estate and industrial over-capacity. Therefore, the performance is in line with what the government itself has been planning for.

It may come somewhat as a surprise to you if you have followed the debt turmoil in Europe to know that European stocks are actually at a 5-½ year high. News from China eased European investors’ concerns over a potential credit crunch in China after the Chinese government announced that the central bank injected more than 255 billion yuan ($42 billion) into the financial system.

Our 10 ETFs in the Spotlight did not make much headway, as the indexes remain stuck in a sideways pattern.

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ETFs/Mutual Funds On The Cutline – Updated Through 01/17/2014

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 398 ETFs, of which currently 325 (last week 324) 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.

These ETFs are generated from my selected list of some 93 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. 60 ETFs (last week 62) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 703 (last week 703) above the line and 161 below it out of the 859 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.

Please note that Mutual fund prices have not been adjusted for yearend distributions.