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.
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