Weekly Average Momentum Index (AMI) rankings of SSPP, nSSPP, SELECT, ETF have been posted at: http://yechen.pan.googlepages.com/
Trading signal occurs in SELECT model portfolio: Sell FSRBX, Buy FSLXX
Trading signal occurs in ETF model portfolio: Sell DVY, Buy CASH
with the sell signals in SELECT and ETF model portfolios this week, all the model portfolios are officially in the cash position . The AMI's in each of the ranking tables are deep in the negative territory, and it will take a while for AMI's to turns positive.
Economy is still contracting right now with all kind of problems: tight credit liquidity, high unemployment rate, low consumer confidence, etc. It will take sometime for the new president to fix the problem after he gets into the office next year. The recovery and the reversal of the stock market trend will not happen right away.
In this market condition, the best thing to do is waiting at the sideline. By keeping what you have, you are already ahead of others who keep their investment in the market and watch their value going down. People quite often are tricked to believe a market turnaround is a hand when they saw a rebound in a bear market. As I pointed out earlier, these rebounds will be weak and short lives because of the nature of the bear market. Do not be fooled to beleive that these are the onsets of bull market. They are, in fact, opportunities to unload your positions if you are still in the market. As trend followers, we have to wait for the uptrend to take hold. And to identiy the trend reversal, you can read my earlier blogs.
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