Fund Rankings Update, 10/28/2011

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings

Trading signal occurs in SELECT model portfolio: Sell FSLXX, Buy FSRPX

European countries' action to tackle their debt crisis boosted investors confidence. Stocks continued their rebound with all major indexes breaking their downward trend line. S&P 500 index closed this week at 1285 up 3.78%, the Dow Jones Industrial Average gained 3.58%, and the Nasdaq composite index increased 3.78%.

In the weekly chart of S&P 500 index, the momentum indicator is climbing above 50, and the price is breaking above the 28 week moving average trend line. We need to wait for the confirmation signal to validate that this rally can turn into a sustainable up trend.

The US sector funds have quickly regained their momentum after this strong market rebound. In the SELECT ranking table the money market fund has been pushed down below the7th rank.  Accordingly,  a trading signal is issued to sell FSLXX and buy the top ranked fund FSRPX for our SELECT model portfolio.

Fund Rankings Update, 10/21/2011

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings

Strong company earning overcame the profit taking in the beginning of the week and kept the stock rally going. For the week, S&P 500 index closed at 1238 up 1.12%, the Dow Jones Industrial Average gained 1.41%, while the Nasdaq composite index decreased 1.14%.

It is encouraging to see S&P 500 index stay above the top of the trading channel at 1220 after breaking it last week. However, the downward trend line provide a stronger resistance at 1257 as seen from the weekly chart below. The index is at the critical juncture as its momentum indicator, STO, is trying to break above 50 and the price is attacking to the trend line.

Fund Rankings Update, 10/14/2011

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings

Trading signal occurs in ETF model portfolio: Sell CASH, Buy IDU.

Trading signal occurs in sETF model portfolio: Sell CASH, Buy IDU.

Technical rebound and better than expected economy news propelled the major stock indexes to the top the their trading channel. S&P 500 index closed this week at 1224 up 5.98%, the Dow Jones Industrial Average gained 4.88%, and the Nasdaq composite index increased 7.6%.

In two weeks, S&P 500 index has climbed from the bottom of the trading channel at 1120 to the top of the channel at 1220. It will be interesting to see which way index is heading next week. Will the expected good company earnings help the index to break the resistance or traders will take profits and capped the its upward movement. 

After one month in cash position, ETF and sETF model portfolios have moved to Utility sector due to its positive AMI.  Since Utility sector is very defensive in nature, I would stay with cash position and skip this trade.

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Fund Rankings Update, 10/7/2011

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings

Economy added more than 100,000 jobs in September, which eased a bit the investors' fear of double dip recession in US. Stocks rebounded from the key support level at 1120 of S&P 500 index.  The S&P 500 index closed this week at 1155 up 2.12%, the Dow Jones Industrial Average gained 1.74%, and the Nasdaq composite index increased 2.65%.

I have not discussed our FEMKX timing model for a while and would like to give an update this week. The model has been very consistent in issuing trading signals at the right time (see trading log in Select_Log page). The model uses STO[15,1] as trading signal. It will buy into the fund if the STO climbs above 50 and sell the fund if STO falls down below 75. In the last trade, the model bought FEMKX when its STO climbed above 50 in July.  After the buy signal, the STO never reached above 70 and fell back below 50. The model then move to cash position after holding the fund for more than a month with 14% loss. This was a failed "buy" signal in action and it cost more than a regular buy and sell signal. FEMKX closed this week at $20.15, 10.3% below our selling price of $22.46. From the weekly chart, there seems to be a support level at $19-$20, and it is currently trying the find comfort in that area. If it finds the support at this level, it will still take some time to consolidate and build a bottom there. In 2008, it moved to cash position for 290 days and finally move to long position at the end of March 2009. We have held cash for only 46 days right now and need to patiently wait for the "buy" signal.

Fund Rankings Update, 9/30/2011

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings

Trading signal occurs in SSPP model portfolio: Sell FNMIX, Buy CASH.

September finally came to an end. With European debt crisis and weak US economy impacting investors' confidence, stocks experience the worst quarter since 2008.  The S&P 500 index closed this week at 1131 down 0.44%, the Dow Jones Industrial Average gained 1.32%, and the Nasdaq composite index decreased 2.73%.

Due to negative AMI, SSPP model portfolio issued a trading signal to move to cash position. Looking back its trading records, only twice in the last 7 years had SSPP model portfolio trading moved to a cash position.The last time it moved to side line is at the end of July 2008. The S&P 500 kept falling afterwards and the portfolion stayed in cash position for more than 8 months before it enter the next trade. The economy condition may be different this time around but caution is always the best policy during uncertain time.