The market intermediate uptrend is bent, but not yet broken. Today, we updated our ETF plan. The good news is that several ETF's on the cusp of breakdown retain their bullish Power Gauge ratings. The bad news, is we may entering right when the market cracks its 200 Day. We just don't know. So, we follow our rules and the Chaikin indicators, knowing that over time, we make money.
Relative Strength Wednesday
Today's relative strength Wednesday analysis lends further evidence that the market is becoming defensive. Utilities and Real Estate lead our RS scoring system, which accounts for Chaikin fundamentals, RS performance vs the SPY and technicals.
Our scoring system is leading us to the defensives, while showing us that the cyclicals are out of favor, as the mostly have been for the last year. This information, along with a declining bull vs bear ratio, a plethora of bearish technicals along with an elevated vix leads us to lean defensive. Now may be a good time to sell some premium! Watch our video for our complete Relative Strength Wednesday analysis!
We implemented the rest of our ETF trading strategy on Friday. Below are all our ETF buys and sells for the past seven days and our trading meeting video from Friday covering entry and portfolio management rules.
Today was management day. We managed the County and Macro portion of our long-term ETF portfolio. Keep in mind, we managed mostly before the open and were still forced to liquidate several of our positions. Watch our video to find out which countries have fallen below our threshold of relative strength performance vs the ACWI.
Here's our Relative Strength Wednesday sector analysis. Video of of trading meeting here.
Macro-Monday is again telling us there is a slow rotation into defensives. As the "trade dispute" drags on and the dollar strengthens Emerging Markets are also losing steam.
Our tracking of the Chaikin Bull V Bear ratio on these ETFs shows what we like to call the contracting bugle. you can view the complete Macro-Monday analysis on the
market conditions page here: Market Conditions
Here are the trades we made this week in our ETF Portfolio. We sold Industrials, but picked up Real Estate, Communications and Discretionary. I also fixed a small mistake from last week by adding first and second tier Country ETF's that met our rules but I had neglected to buy during our meeting. Our portfolio is fully invested to the stock allocation net liquidating cap for bullish conditions. If the market bounces following this intermediate pullback, we'll be in great shape. If the winter rally was a "false flag" and we're headed lower, this is gonna hurt. But, we follow our rules. Trading meeting video explaining it all is here.
Our portfolio investments as they stand today.
Today, we managed our ETF Portfolio. More trades to make tomorrow.
Relative Strength Wednesday
After closing below the 200 day Chaikin MA, the price of the SPY rose back above to end the day yesterday. Money Flow remains strong and the OB/OS oscillator is fairly deep into oversold.
Our Relative Strength Wednesday analysis shows a rotation to the defensive.
Reminder, our RSW analysis is scoring system that accounts for a combination of Chaikin fundamentals and technicals to determine rank.
XLRE has jumped to the top sector according to our analysis, while XLY has quickly retreated from the top three. The move this week in XLU also helps paint the defensive story as it moves from the bottom 1/3rd to the top 1/3rd.
Watch our video for the complete Relative Strength Wednesday analysis.
A few things to cover here. First, we made some purchases at the open yesterday for our ETF portfolio. The trend was still up in the short and intermediate time frame and a number of Country and Macro ETF's were outperforming the ACWI on a 3m and 6m basis, so, despite the explosion in the VIX, we were cautious buyers at the open yesterday. Why? Because our rules told us to. Here's a summary of this week's trades in our ETF plan.
Macro Monday trading meeting video conducted prior to the open below. Our latest market posture is here in Market Conditions SPY is pulling back into persistent Money Flow, which is telling us this may be a good pullback to buy on. However, with Trump's tweets driving market direction, we're cautious. Personally, I'm using half position sizes on the bull side right now.