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ETF Global Opportunities

9 November 2018
by Tarquin Coe

Market Overview

 

The NYSE Bullish % has reversed up but that alone is not an all clear over the medium-term. More of a base is necessary or strong upside follow-through (to above 50%). Portfolio remains cautious equity funds.

 

 

 


 

This Week's Trades

  • None.

 

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

 

 


 

Analysis

 

US Equity Indices

 

The Midcap Index Trust (MDY) is weak this afternoon and deteriorating from just beneath its two key moving averages. Momentum is no longer oversold with the recent bounce. Relative ratio reflects underperformance against the large caps since June.

 

 

 

US Sector Indices

 

The Consumer Staples fund this week pushed out to its best level since early February. The relative ratio showed strong outperformance during the October volatility, proving the defensive attraction of the fund.

 

 

 

 

Other Developed Indices

 

The Hong Kong ETF bounced from oversold with the start of this month, running into resistance from the 50-day exponential moving average. Trading is now weakening, resuming the 2018 downtrend. Momentum is not oversold.

 

 

 

The United Kingdom Index has also encountered resistance from its falling 50-day exponential moving average. With momentum back to neutral, the chart is positioned for a downside reassertion. The relative ratio, versus the U.S. market is also rolling over. 

 

 

 

Emerging Indices

 

The Emerging Markets fund has encountered resistance from its 50-day average and is vulnerable to breaking lower, as it did on previous tests over the past several months. The 14-day RSI is rolling over from neutral. 

 

 

 

Commodities

 

The United States Oil fund has trended down persistently since a 52-week high at the start of October. The lack of a sizeable bounce has created an oversold condition. The 200-day moving average has broken. Should an oversold bounce develop, watch for an underside test of that average. 

 

 

 

Bonds

 

The US 20+ year Bond fund is slipping to new 3 year lows. The relative ratio, versus the equity market is also weak plus momentum is not oversold. Weakness expected to continue.

 

MODEL PORTFOLIO
ETF Trading (Long/Short) Longs
Date Stock Code Type Open Price Current Price % P&L
28 Aug 2018 CurrencyShares Swiss Franc Trust FXF Long 95.85 92.85 -3.13%
11 Oct 2018 Market Vectors-Gold Miners GDX Long 19.87 19.38 -2.47%
16 Oct 2018 Gold GLD Long 115.8 115.78 -0.02%
2 Nov 2018 SPDR Sector Trst Utilities XLU Long 53.15 54.79 +3.09%
ETF Trading (Long/Short) Shorts
Date Stock Code Type Open Price Current Price % P&L
20 Feb 2018 Agriculture DBA Short 18.98 17.5 +7.80%
17 May 2018 iShares Italy Index EWI Short 32.4 25.67 +20.77%
28 Aug 2018 iShares 7-10 yr T-Bond Fund IEF Short 102.43 99.78 +2.59%
11 Oct 2018 SPDR Sector Trst Technology XLK Short 68.63 71.07 -3.56%
11 Oct 2018 iShares FTSE/Xinhua China 25 Index Fund FXI Short 39.08 41 -4.91%
11 Oct 2018 US High Yield HYG Short 84.7 84.84 -0.17%
16 Oct 2018 ISHS Russell 2000 Index IWM Short 158.64 156.99 +1.04%
25 Oct 2018 SPDR Sector Trst Energy XLE Short 66.98 68.62 -2.45%
2 Nov 2018 PowerShares QQQ QQQ Short 169.38 174.46 -3.00%
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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