Our weekly macro analysis using the Chakinan Analytics app.  We also show several examples of how you could use the Chaikin Analytics screening tool to find bullish or bearish opportunities. 

We made a couple of swaps in our ETF portfolio, trading relative weakness for relative strength.  See our ETF Friday video for more. 

Due to travel schedules we bumped Relative Strength Wednesday up this week.  Our weekly in depth analysis of where the strength in the market currently exists reveals that rotation continues.  The ongoing battle between XLF and XLU will likely be decided soon, likely in favor of XLU.  Also this week, the consumer discretionary ETF, XLY, took it on the chin.  Watch todays video for our complete Relative Strength analysis. 

The market got the Fed cut it had expected, but sold off to end the week.  The bull / bear ratio of the SPY remains above 1.0, price remains up and above both moving averages and MF remains positive.  Fridays self-off led the OB/OS oscillator below 70, which is a good thing. We need to clear these overbought conditions to have any hope of breaking SPY 300 with any conviction. 

The Bull / Bear ratio  is near that 1.5 sweet spot. We've found that above 2.0 signals exhaustion. We like to see the ratio above 1.0 but under 2.0.  Our sector trend releild financials and utilities leading the SPY sectors on the mostly fundamental Bull / Bear ratio.  This relationship doesn't tend to last too long. We'd expect to see that battle resolve itself sooner, rather than later.  We'd expect to see Utilities win this battle as bonds catch a bid. 

Thursday, we managed our ETF portfolio following our rules using relative strength (and weakness) analysis.  Below are our portfolio holdings, organized by 6 month percent return performance for each underlying asset, as well as the net liquidating value of each holding. We are sitting on just shy of $16,000 in unrealized gains.   

Above are the trades we made today.  Recent strength in financials relative to the All Country World Index let to 2% purchases of the XLF and KIE.  To make room, we lightened up on Switzerland, which has fallen below the 3 month return of the benchmark and the weakest holding on a 6 month return basis.  We trimmed back our overweight tech position by trimming the QQQ's.  We are fully invested for the stock portion of our portfolio.  Trading video below. 

The market seemed to be on pause until hearing from the Fed this afternoon. All the major indices remain overbought.  How they clear overbought will matter to us. 

We can clearly see the rotation in the last week as the market seems to have adjusted it's expectations from the Fed, and unwound the recession trade. Financials, the consumer and communications lead this weeks analysis.  Remember, communication is 1 part growth, with names like Facebook and Google and 1 part yield with telecoms like Verizon. 

Macro-Monday analysis is available in the market conditions section of the site. 

The market is set up to take a breather into the Fed meeting next week.  Bonds continue to endure a brutal sell-off, pushing rates higher in a hurry.  Is the move in the bond market simply a technical one, or is the market repricing economic and Fed expectations?  We imagine clarity will come next Wednesday from Mr. Powell himself. 

After our daily look at the overnight action, we turned to our simulated ETF portfolio. Today we looked for opportunities to add in Country 1, Country 2 and Macro ETFs. As hard as it was, we followed our rules and made room for $GLD, $SLV and $TLT

Today's trades are above.   Our portfolio net liq along with unrealized gains following our ETF relative strength plan

The market rally continues, hower 3 of the 4 major indices are now extremely overbought. The SPY bull / bear ratio has broke above the 1.50 level, which it has been unable to do since mid July. We remain bullish,  cautiously waiting to see how the market will clear  these overbought conditions.   

After our daily look at the market, we turned to managing our simulated ETF portfolio.  We were a bit surprised that our Macro holdings ( GLD, SLV, TLT, IEF) all survived the unwind of the "recession trade"  ...at least so far.    We are fully invested according to the rules of our ETF plan, but tomorrow we will look to make adjustments via forced liquidation and acquisition if we find opportunity.  

The market is overbought, but a few cyclical sectors are starting to show some sounds of life.  Financials and Discretionary have recovered from their correction and, while this chart doesn't really show it yet, Industrials and Energy have had a few strong days.  This chart reflects trading, price action and Chaikin metrics through yesterday.  Video explaining are process is below.