Fund Rankings Update, 6/28/2019

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.

Trading signal occurs in SSPP timing model: Sell FOCPX, Buy FDEGX.
Trading signal occurs in iETF timing model: Sell EWN, Buy EWL.

Stocks were flat as investors waiting for interaction between Trump and Xi in G-20 meeting to gauge the progress of the trade talk between US and China.  On the economy front, durable goods orders and manufacturing activities contacted more than expected while personal income and spending went up in May.  For the week, S&P 500 index closed at 2941 down 0.29%, Dow Jones Industrial Average lost 0.45% and technology laden NASDAQ composite index decreased 0.32% for the week.

Weekly chart of S&P 500 index

S&P 500 index took a break this past week but still close only 9 points below its 2950 resistance level. The momentum indicator STO[15,1] of the index is in the overbought region and heading higher. It is very likely that the index will continue its upward advance.  However, this market has been driven largely by headline news and tweets in trade and geopolitical tension, and the direction of the market can change in an instant.

Two trading signals have been issued in the model portfolios this week. FOCPX, a small cap focused fund is being replaced with FDEGX, a large cap focused growth funds in SSPP model portfolio due to momentum ranking change. In the iETF model portfolio, Netherlands index fund, EWN, is being replaced with Switzerland index fund, EWL, due to momentum ranking change as well. Note that iETF model portfolio has not performed as well as other model portfolios due to higher volatility in the international index funds. Holding periods in the iETF model portfolio are generally shorter than other portfolios. Weekly momentum ranking system is trying to catch the intermediate-term up trend and needs longer holding period to reap the profit.

Fund Rankings Update, 6/21/2019

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.

Trading signal occurs in FEMKX timing model: Sell Cash, Buy FEMKX

Stocks climbed sharply higher with S&P 500 index reached record high during the week.  The strong rally was powered by Fed's statement after its policy meeting on Wednesday showing its willingness to cut rate if necessary to keep the economy expansion going.  Geopolitical tension in middle east and news that Iran shooting down US military drone also pushed the oil prices and energy stocks higher.   For the week, S&P 500 index closed at 2950 up 2.2%, Dow Jones Industrial Average gained 2.41% and technology laden NASDAQ composite index increased 3.01% for the week.

Weekly chart of S&P 500 index

As displayed in the weekly chart, S&P 500 index reached a record of 2964 in mid-week and closed back down a bit at the the resistance level of 2950. This is the third time S&P 500 reached 2950 resistance level. The index did not fare well in the previous two times bumping against this resistance.  The first time in Sept-Oct 2018, the index plunged 20 percent with a duration of 12 weeks, and the second time in April 2019, the index fell 8 percent for a duration of 5 weeks. Next couple of weeks will be critical in determining the direction of the stock markets. The up trend will continue if S&P 500 index can close solidly above 2950 making a higher high on the weekly chart. If the index fails again at this resistance level, we will see a prolong bear market in the very near future. 

Notably, a trading signal occurs in FEMKX timing model this week as stocks have been strong for the past four weeks. The momentum indicator STO[15,1] of FEMKX has climbed back above 50 this week and a buy signal was issued. The FEMKX timing model has consistently predict the intermediate term market direction in the past.  It will be interesting to see how it performs this time. 

Fund Rankings Update, 6/14/2019

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

Trading signal occurs in sETF model portfolio: Sell IGV, Buy ITB.

Stocks opened the week strong but fail to keep the momentum going and ended up flat.  Energy prices experience high volatility this week.  US government report showed large increase in oil inventory for the 2nd week on Wednesday causing a plunge in oil prices while news on Thursday about two oil tankers been attacked in Persian Gulf sending oil prices sharply higher.  For the week, S&P 500 index closed at 2886 up 0.47%, Dow Jones Industrial Average gained 0.41% and technology laden NASDAQ composite index increased 0.7% for the week.

Weekly chart of S&P 500 index

S&P 500 index went up a bit higher carried by the upward momentum. The index gaped up Monday, and went up to 2910 mid-week but failed to march higher and ended up about where it started. The short body candle in the weekly chart shows the indecision in the market this past week.  Our outlook remains the same as last week with slightly negative bias. However, if the index can consolidate above its 28 week moving average, there is a good opportunity go higher. 

As interest rate comes down, housing and utility sectors goes up. sETF model portfolio issued a trading signal this week to buy into home construction sector fund, ITB, while moved away from software sector index fund, IGV.  The model portfolio has held IGV for about 4 months with a gain of 3%. ITB has been the number 1 ranked fund in the past 6 weeks and looks like the high momentum will continue for a while. We will find out how it performs in the next couple months. 

Fund Rankings Update, 6/7/2019

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

Trading signal occurs in RSP model portfolio: Sell FDGRX, Buy 42627

Stocks closed sharply higher as likelihood of a interest rate cut grew higher due to economy slowdown and trade disruption.  With May as the worst month for stocks, last week was the best week for S&P 500 index in the past 6 months. On Tuesday, Fed chair Jerome Powell indicated its dovish stance on interest rate under the impact from trade tension, while on Friday, job report showed US economy only added 75000 jobs in May confirming the slowdown.  For the week, S&P 500 index closed at 2873 up 4.41%, Dow Jones Industrial Average gained 4.71% and technology laden NASDAQ composite index increased 3.88% for the week.

Weekly chart of S&P 500 index

S&P 500 closed 2.5% above its 28 week exponential moving average (EMA) from 1.6% under a week before. We were right in our prediction on getting a rebound this past week but were wrong in expecting the index staying below the 28 week EMA. Bulls and bears are fighting around the trend line while the momentum indicator, STO, is flat below 50 indicating an indecision in the market direction. We think the momentum this week may carry the index upward for another week or two. Afterwards, the index will continue its downtrend similar to the February-March-April period in 2018. 

The decline in May has caused rotation in sector performance as economy slowdown and bond yield heading lower. A trading signal occurs in the RSP model portfolio this past week to sell Fidelity Growth Company fund and move to the more defensive SS REIT index (42627) fund.   

Fund Rankings Update, 5/31/2019

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

Stocks closed lower for the fourth week as investors worried about U.S. economy growth signaled by inverted yield curve and rising trade tension with China and Mexico.  May turned out to be the worst month for stocks since December 2018.  For the week, S&P 500 index closed at 2752 down 2.62%, Dow Jones Industrial Average lost 3.01% and technology laden NASDAQ composite index decreased 2.41% for the week.

Weekly chart of S&P 500 index

After 2 successful tests at 28 week exponential moving average, S&P 500 index plunged below the support and closed 1.6 % below its 28 week EMA at 2752. Our market outlook is turning bearish as the index is firmly below its trend line.  As the market sentiment has been so overwhelmingly negative and need some relief, we may see a rebound rally next week.  However, the 28 week EMA once broken has become a resistance and we don think it will be broken even if a rebound does occur next week.