Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, and sETF have been posted on "Rankings", and "Trading Logs" pages, as well as in http://ycprankings.awardspace.us/RankingTables.htm.
Trading Signal occurs in FEMKX timing system: Sell FEMKX, Buy Cash
Stocks started the August trading sessions with weak performance due to rising treasury yield and unexpected downgrade of US crediting rating from Fitch Ratings. Economic data released during the week showed the slowdown in labor market and lower manufacturing activities: Nonfarm payroll increased 187000 in July well below the first five month average of 287000. The Institute for Supply Management manufacturing Purchasing Managers’ Index (PMI) was at 46.4 in July below the 46.9 consensus number. PMI below 50 indicates the contraction in manufacturing activities. For the week, S&P 500 index went down 2.27% to 4478 Dow Jones Industrial Average lost 1.11%, while the technology-laden NASDAQ composite index decreased 2.85%.
A bearish engulfing candle stick pattern shows up in the weekly chart this week. The body of the white candle last week is contained within the larger red candle this week. This bearish engulfing pattern signals the upcoming correction. The index was 8% above its 28-week EMA last week, and will very likely head down to meet the EMA in the next few weeks. The first support from the chart is at 4300 and the next support is at 4200. The bull run will survive if the index can hold above its 28-Week EMA around 4300.
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| The weekly chart of the S&P 500 index |
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