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Weekly analysis on US stocks, sectors, commodities and global indices.
16 May 2017
     

Market Overview

 

The S&P 500 ETF is breaking out to fresh record highs yet indicators remain comfortable.

Overlaid onto the SPY chart is the short-term-composite. The indicator has just turned up from 40% and has plenty of upside ahead. The relaxed condition of indicators will allow the equity rally to extend. We continue to see any intraday weakness in the stronger equity funds as a chance to buy.

We remain net long equity funds.

 

 


 

This Week's Trades

  • None

Note - Trades will be executed on today's close.

 


 

Other ETF Highlights

 

  • S&P 500 (SPY) - Buy
  • Materials (XLB) - Buy Reiterated
  • Global Energy Index (IXC) - Buy
  • Hong Kong (EWH) - Buy
  • Emerging Asia Pacific (GMF) - Buy
  • Euro Trust (XLE) - Watch to Buy
  • Gold (GLD) - Buy
  • Emerging Markets Bond (EMB) - Buy

 


 

Analysis

 

US Equity Indices

 

The S&P 500 fund is breaking out to new all-time highs. The March and April consolidation into the 50-day exponential moving average is over. The 14-day RSI has room to allow the rally to continue towards $245 over the next few weeks.

 

 

US Sector Indices

 

The Materials ETF is resuming its uptrend following a brief test of its 50-day exponential moving average last week. The 14-day RSI is turning up attractively from the neutral sweet-spot. New all-time highs imminent. 

 

The Global Energy Index ETF is attempting to end its correction off the December 2016 high. Support is being found from the 200-day exponential moving average. A break above $34 would confirm the correction is over, with the primary uptrend resuming.

 

 

Other Developed Indices

 

The Hong Kong ETF was strong yesterday, pushing to new 52-week price highs. The 2017 price and relative uptrends are reasserting. Consider entry on any weakness. Potential for new decade highs by late summer.

 

 

 

 

Emerging Indices

 

The Emerging Asia Pacific fund made a new 52-week high index yesterday and a new 2017 relative high. Uptrends are resuming. Aim to enter on the next mini pull-back.

 

 

Currencies

 

The Euro Trust is establishing a footing above its 200-day exponential moving average. With momentum not being overbought, the uptrend off the December 2016 low could strengthen over the short-term. Trading longs could place a stop just under the 200-day average. 

 

 

 

Commodities

 

The Gold ETF is attempting to resume its up channel off the December low. Clearing the 200-day exponential moving average would add confidence in the recovery. Plenty of room on the 14-day RSI to allow an extension higher from here to new highs for 2017. 

 

 

 

 

Bonds

 

The Emerging Markets Bond ETF is reasserting its uptrend off the November 2016 low. The uptrend is steady and should continue over the next week or two at least. The 14-day RSI has the room to allow that strength. 

 

MODEL PORTFOLIO

ETF Trading (Long/Short) Longs

Date Stock Code Type Open Price Current Price % P&L
12 Jul 2016 ISHS Russell 2000 Index IWM Long 119.72 138.58 +15.75%
12 Jul 2016 iShares Dow Jones US Aerospace & Defense Index Fund ITA Long 127.66 153.74 +20.43%
12 Jul 2016 Semiconductor HOLDRS SMH Long 59.36 83.77 +41.12%
19 Jul 2016 PowerShares QQQ QQQ Long 112.13 139.04 +24.00%
19 Jul 2016 SPDR Sector Trst Materials XLB Long 48.81 53.07 +8.73%
19 Jul 2016 SPDR Sector Trst Technology XLK Long 45.21 55.87 +23.58%
19 Jul 2016 Base Metals DBB Long 13.79 15.63 +13.34%
26 Jul 2016 iShares Brazil Index EWZ Long 32.57 40.15 +23.27%
2 Aug 2016 iShares GS Semiconductor Index SOXX Long 102.48 143.75 +40.27%
30 Aug 2016 iShares DJ US Broker-Dealers Index Fund IAI Long 41.8277 51.08 +22.12%
6 Sep 2016 iShares GS Software Index Fund IGV Long 113.91 135.6 +19.04%
6 Sep 2016 iShares Japan Index EWJ Long 50.12 52.52 +4.79%
13 Sep 2016 DJ US Regional Banks Index Fund IAT Long 35.24 44.77 +27.04%
8 Nov 2016 iShares DJ Transportation Average IYT Long 149.74 163.43 +9.14%
8 Nov 2016 streetTRACKS KBW Bank ETF KBE Long 34.94 42.68 +22.15%
22 Nov 2016 SPDR Sector Trst Industrial XLI Long 61.91 66.61 +7.59%
29 Nov 2016 Diamond Trust- 1/100 DJIA DIA Long 191.19 209.93 +9.80%
6 Dec 2016 iShares Switzerland Index EWL Long 28.85 34.33 +18.99%
10 Jan 2017 SPDR Sector Trst Health Care XLV Long 71.5 75.77 +5.97%
28 Feb 2017 DJ US Pharmaceuticals Index Fund IHE Long 153.26 152.1 -0.76%
7 Mar 2017 SPDR Sector Trst Energy XLE Long 71.51 68.28 -4.52%
21 Mar 2017 iShares MSCI South Africa Index Fund EZA Long 59.73 60.23 +0.84%
9 May 2017 United States Oil Fund USO Long 9.57 10.17 +6.27%

ETF Trading (Long/Short) Shorts

Date Stock Code Type Open Price Current Price % P&L
13 Sep 2016 iShares S&P National Municipal Bond Fund MUB Short 112.63 109.53 +2.75%
4 Oct 2016 SPDR Sector Trst Utilities XLU Short 47.29 51.95 -9.85%
14 Feb 2017 Livestock COW Short 22.16 24.5201 -10.65%
Model Portfolio Notes
Opening of positions – Positions are opened on the immediate closing price following the report.
 
Stops - Two flash crashes (2010, 2015) and occasional bad prices have forced us to drop strict stops. Positons will no longer be stopped out but we shall suggest a region as to where we MAY exit. 
 
Closures - With positions not being stopped out, we shall only exit positions via advice in the report. When we exit a trade, the next closing price is used. 
 
Allocation – Each trade is allocated 5% of the portfolio.
 
 
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