YCP ETF and Mutual Fund Rankings: July 2019

Fund Rankings Update, 7/26/2019

Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted in "Rankings", "Trading Logs" pages, as well as in http://ycprankings.awardspace.us/RankingTables.htm.

Stocks reached another record high on better than expected second quarter GDP and company earnings. US second quarter GDP growth slowed down to 2.1% but 0.1% better than economists' expectation. Company earning growth also slowed to single digit on a yearly basis but stronger than street consensus. These economic data did not change the expectation of a 0.25% rate cut at the Fed's meeting next Wednesday. For the week, S&P 500 index closed at 3025 up 1.65%, Dow Jones Industrial Average gained 0.14% and technology laden NASDAQ composite index increased 2.26% for the week.

Weekly chart of S&P 500 index

S&P 500 index looks to be forming a rounded top and stays 5.4% above its 28 week moving average. Its momentum indicator is in the overbought region without sign of decreasing. We do not expect much movement from the index before the Fed meeting as this market has been driven by interest cut expectation. We will have clearer picture of the market direction after Fed's announcement next Thursday.

Fund Rankings Update, 7/19/2019

Trading signal occurs in sETF model portfolio: Sell ITB, Buy IAK
Trading signal occurs in RSP model portfolio: Sell 42627, Buy FCNTX

Stocks experienced higher volatility as companies started to report 2nd quarter earnings. Economic data during the week showed solid retail sale gain in June as well as better than expected growth in manufacturing activities. These positive economic data dampened investors' hope for Fed's rate cut at the end of July from 0.5% to 0.25 %. For the week, S&P 500 index closed at 2976 down 1.23%, Dow Jones Industrial Average lost 0.65% and technology laden NASDAQ composite index decreased 1.19% for the week.

Weekly chart of S&P 500 index

After breaking the 3000 psychological barrier S&P 500 failed to hold the position and closed down below 3000 at 2976 with the next support level at 2950. The pullback lowers the deviation of the index from its 28 week EMA to 4.1% from 5.7% last week. Notice that the index is currently higher than the peak of 2954 at the end of April, while the momentum indicator STO [15,1] currently at 94.5 is lower than the reading of 98 at that time. This divergence shows the taping off of the advancing momentum. While the index still posses an extreme high momentum and may continue its advance, the divergence is something worth to pay attention to.

Fund Rankings Update, 7/12/2019

Stocks advanced to record high encouraged by the dovish testimony from Fed Chair, Jerome Powell in front of House Financial Service Committee. The possibility of a 0.5% rate cut at the Fed's July 30-31 meeting has been greatly increased by his comment. For the week, S&P 500 index closed at 3013 up 0.78%, Dow Jones Industrial Average gained 1.52% and technology laden NASDAQ composite index increased 1.01% for the week.

Weekly chart of S&P 500 index

S&P 500 index has broken the psychological barrier of 3000 and reached the record high at 3013. On the daily chart (not shown), the index broke the bull flag pattern (a continuation candle stick pattern) and gapped up to reach the new high. I looks like the index will continue to advance higher on a short term basis. However in the weekly chart, the index is 5.7% above its 28 week exponential moving average. Remember the index was 10%, 4,8% and 5.9 % above its 28 week EMA before the respective sell-off in January 2018, October 2018 and May 2019. This rally is fueled by expectation of a rate cut and we may see a shake up once the rate cut is realized at end of July. The so call " Buy the Rumor, Sell the News" may apply in this case.

Fund Rankings Update, 7/5/2019

Markets closed early Wednesday and the whole Thursday in observation of Independence Day. All the major indices still managed to march higher in spite of the light trading volumes. For the week, S&P 500 index closed at 2990 up 1.65%, Dow Jones Industrial Average gained 1.21% and technology laden NASDAQ composite index increased 1.94% for the week.

Weekly chart of S&P 500 index

S&P 500 index closed solidly above its previous high and stands at 2990. However, the index is again more than 5% above its 28 week exponential moving average. Caution is needed in the next few weeks.