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 FDGRX, Buy FRESX.
Concern about European's debt crisis and the pace of US economy growth plunged the stock markets again. SP 500 index closed this week at 1295, down 4.3%. Dow Jones Industrial Average lost 3.52%, and Nasdaq composite index dropped 5.28%.
S&P 500 index has fallen below the support level of 1300 that I mentioned last week, and there is no letting up of the selling pressure. Price movement of the index looks pretty similar to the sell-off in August last year. The index looks to be heading lower for another couple of weeks before it stabilizes. Looking back, the sell signal from our FEMKX timing system two weeks ago proves to be the right call.
In this sell-off environment, patient is virtue. Markets tend to overshoot in both ends, and this may create some buying opportunities. For example, let's look at APPLE. I mentioned a few weeks ago that Apple can be bought at $550 as a riskier trade or at the price where it meets its 28 week moving average for a safer trade. Apple closed this week at $530 and its 28 week moving average is at $490. With the current bearish market sentiment, we may have the opportunity to buy Apple at around $500 or even below when the price meets the 28 week moving average.
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