Month: September 2014

This week the percent of Nasdaq stocks above their 50 day average is 34.03% down from 47.15% last week. Generally it is not a good idea to invest in a stock which is below its 50 average and a bad idea to invest in a stock below its 200 day average. The percent of Nasdaq stocks above their 200 day average 38.66% down from 45.05%.
The market is at the end of a quarter and generally funds (mutuals, hedge, etc.) invest any extra cash in stocks they currently own in order to move the price up and make their quarterly returns look better. Another positive for the market is the Federal Reserve Board. Every time the market gets into trouble, one of the members (or a counterpart in Europe, Japan, or China) makes a positive comment. Thirdly, we have an election coming up. No party in power wants the market to be going down into an election. After 1987 23% crash in one day, a plunge protection team was set up to handle the economy in times of economic turbulence and I am sure it is active today. All the indicators indicate we are near a market top, but the politics wins until the market chooses to ignore it.

After Monday’s market decline IBD changed to “Uptrend Under pressure” – not a good sign. The same thing happened last week, except last week IBD changed to “Confirmed Uptrend” on Thursday and Friday. That change lasted for two days.

IBD TBP’s Current Outlook is “Uptrend Under Pressure” – Not a time to invest.

Out of the 130 Fidelity funds I follow, only SChemicals #05, SIndustrials #56, and MunicipalIncome #77 have an increasing deviation from their moving average over the last two weeks which I require before I invest.

My current investments:
SBiotechnology has a price of 219.02 a sell price 208.07, a rank of 01, and is a Hold.
SElectronics has a price of 79.58, a sell price 76.99, a rank of 04, and is a Hold.
SHealthCare has a price of 221.12, a sell price 210.72, a rank of 02, and is a Hold.
SUtilities has a price of 73.92, a sell price 71.68, a rank of 55, and is a Hold until something better is a buy or it drops below its sell line.
SPharmaceuticals has a price of 21.80, a sell price 20.71, a rank of 03, and is a Hold.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 100% invested

One of the charts I review is the percent of Nasdaq stocks whose price is above their 50 day average. This week the number closed at 47.15% indicating more than half of Nasdaq stocks are below their 50 day average. The same number for the New York Stock Exchange at 46.24%. The 50 day average of this number for both exchanges has been declining from about 60% to 50% over the last 6 months. Not a positive sign.
TNA – Direxion Daily Small Cap Bull 3X ETF – represents the strength of the smaller capitalization stock stocks stocks while UPRO – ProShares UltraPro S&P500 ETF – represents the strength of the 500 largest capitalization stocks. UPRO is up 7.97% while TNA is down 10.88% over the last 3 months. Thus, while the largest stocks are going up, the smaller stocks are going down. A long term up market requires the participation of all stocks not just the largest.

After Monday’s market decline IBD changed to “Uptrend Under pressure” – not a good sign. After Thursdays market increase IBD changed to “Confirmed Uptrend.” The Nasdaq has 5 distribution days and S&P 500 has 3. Not a good sign but for now the uptrend continues.

IBD TBP’s Current Outlook is “Confirmed Uptrend” – time to invest.

Out of the 130 Fidelity funds I follow, only SBanking #56, SDefense&Aerospace #82, and SPharmaceuticals #04 have an increasing deviation from their moving average over the last two weeks which I require before I invest.

My current investments:
SBiotechnology has a price of 217.37 a sell price 207.96, a rank of 02, and is a Hold.
SElectronics has a price of 80.63, a sell price 76.99, a rank of 03, and is a Hold.
SHealthCare has a price of 221.81, a sell price 210.72, a rank of 01, and is a Hold.
SUtilities has a price of 75.45, a sell price 71.68, a rank of 54, and is a Hold until something better is a buy or it drops below its sell line.
SPharmaceuticals has a price of 21.79, a sell price TBD, a rank of 04, and is a Buy.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – Invest 20% in SPharmaceuticals

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 100% invested

Monthly I get an advertisement for “The InvestorsGuide To Fidelity Funds” from Mathew D. Sauer asking me to subscribe to his guide. I don’t. His web site is mutualfundinvestorguide.com and the advertisement contains an offer to view last month’s guide. The August guide in the Fidelity Select Sector Fund Portfolio contains the Fidelity Select funds Pharmaceuticals, Technology, Financial Services, Healthcare, and Industrial Equipment.

On Consuelo Mack’s weekly Wealthtrack show for 12 September several long term indicators were reviewed. All seemed to point to the very high current stock prices. Included in those indicators was the CAPE Ratio – Cyclically Adjusted Price-Earnings Ratio created by Robert Shiller and John Campbell. Three times since 1881 the CAPE Ratio has been higher – around 1929, 1999, and 2007 and Professor Shiller points out that “Major market drips followed those peaks.” As part of her show, Mack always asks the guests for one long term investment and this week the investments were The Buckle Inc, and Schlumberger Limited.

IBD TBP’s Current Outlook is “Confirmed Uptrend” – time to invest. Both the S&P500 and NASDAQ have had three distribution day. The number of distribution days are an indication of major investor selling. A couple more distribution days within the next 3-4 weeks and the Current Outlook will change.

Out of the 130 Fidelity funds I follow, only SBanking, #61, and SDefense&Aerospace, #93, had an incerasing deviation from their moving average over the last two weeks which I require before I invest.

My current investments:
SBiotechnology has a price of 216.94 a sell price 207.96, a rank of 01, and is a Hold.
SElectronics has a price of 79.96, a sell price 76.99, a rank of 03, and is a Hold.
SHealthCare has a price of 218.94, a sell price 207.47, a rank of 02, and is a Hold.
SUtilities has a price of 74.65, a sell price 70.92, a rank of 58, and is a Hold until something better is a buy or it drops below its sell line.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – None

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested

August was a profitable month. In August my 5 portfolios, IRA#1 up 4%, IRA#2 up 1%, PDP PIE PIZ DWAS up 5%, TQQQ up 9%, TQQQ/SQQQ up 1%. For the last 3 months, IRA#1 +8%, IRS#2 -1%, PDP… +8%, TQQQ +25%, TQQQ/SQQQ +17%.
August portfolio changes:
IRA#1 – Sold SElectronics on 8/11 and purchased SBiotechnology.
IRA#2 – Sold Nordic on 08/04, SNaturalGas on 8/04, SAirTransportration on 08/04, STransport on 08/11, SElectronics on 8/11, and purchased SBiotechnology on 8/19, SElectronics on 8/25.
PDP PIE PIX DWAS – Sold PIE on 8/18 when the 3 month gain turned negative and purchased DWAS. Current positions are DWAS 50%, PDP 33% and PIE 17%.
TQQQ – Sold TQQQ on 08/01 and purchased TQQQ on 8/14.
TQQQ/SQQQ – Purchased SQQQ on 08/06, sold SQQQ on 8/14, and purchased TQQQ on 8/14.

My investing rules for these portfolios are on my web site:
1 – for funds https://www.flynndj.com/my-iras/fund-evaluation-method/
2 – for ETFs https://www.flynndj.com/7-etf-investment-study/

I suggest you sign up for the webinar which Gary Kalbaum is offering on 09Sep14 at 4:15pm. If you are busy sign up anyway because he plans to make an archive available. Sign up at www.garyk.com. It is free without obligation, but you will probably, as I have, get a call from them asking if you have questions

IBD TBP’s Current Outlook is “Confirmed Uptrend” – time to invest. Both the S&P500 and NASDAQ have had a distribution day. The number of distribution days are an indication of major investor selling. One is not significant, but four or more are indication the uptrend is ending.

My current investments:
SBiotechnology has a price of 213.87 a sell price 207.96, a rank of #3, and is a Hold.
SElectronics has a price of 81.04, a sell price 76.99, a rank of #1, and is a Hold.
SHealthCare has a price of 218.39, a sell price 207.47, a rank of #2, and is a Hold.
SUtilities has a price of 77.03, a sell price TBD, a rank of #18, and is a buy. SUtilites is the only of the top 20 funds I do not owned which has had an increasing deviation from its moving average.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – Buy SUtilities

My portfolio market exposure after this weekend’s changes:
IRA #1 – 100% invested
IRA #2 – 80% invested