Author: Flynn

Stock Trader’s Almanac 2013, updated each year by Jeffrey A. Hirsch & Yale Hirsch, contains a chart on page 148 which lists the Nasdaq monthly performance from January 1971 through April 2012. September is the worst month of the year with an average loss of 0.7%. Over the same time period, January is the best month with an average gain of 2.9%. Investors Business Daily claims the market is still in correction.

The sum of the deviations (674,414,617) is not up for the last two weeks – not a time to invest.
The DJ Wilshire 5000 index is below its 50 day moving average and the average is increasing – not a time to invest. Both trends are not up – not a time to invest.

My current investments:
SAutomotive has a price of $52.95, a sell price $50.50, a relative rank of 02, 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 – 20% invested

Dr. Chris Kacher with a PHD in nuclear sciences in 1995 (http://en.wikipedia.org/wiki/Chris_Kacher) wrote a book in 2010 titled “Trade Like an O’Neil Disciple: How We Made 18,000% in the Stock Market.” His web site is www.virtueofselfishinvesting.com. In his interview on the Gabriel Wisdom show last week he said he sold everything in this August after the Nasdaq had five distribution days in the last 20 days. Distribution days are days the Nasdaq market is down with higher volume. It is interpreted as day when the large portfolio managers are selling more than buying. O’Neil is the founder of Investors Business Daily and wrote the book “How to Make Money in Stocks”. I went to a seminar he presented about 20 year ago and sure wish I had paid more attention to his presentation. I am currently slowing reading the latest book his staff has published “How to Make Money in Stocks: Getting Started.” Investors Business Daily’s Market Pulse Current Outlook is still “Market in Correction” which IBD says is time to protect your profits and not a time to buy.

The sum of the deviations (672,674,414) is not up for the last two weeks – not a time to invest.
The DJ Wilshire 5000 index is below its 50 day moving average and the average is increasing – not a time to invest. Both trends are not up – not a time to invest.

My current investments:
SAirTransportation has a price of $48.61, a sell price of $49.17, a relative rank of 27, and is a sell.
SAutomotive has a price of $51.08, a sell price $50.50, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $61.73, a sell price $62.44, and is a sell.
JapanSmallerCompanies has a price of 12.32, a sell price 12.75, and is a sell.
When I sell JapanSmallerCompanies, I will pay a fee of 1.5% since I’ve held it less than 90 days. Since it fell 3.6% this week, I do not think holding it for another 50 or so days is worth it.

My portfolio changes this weekend:
IRA #1 – None
IRA #2 – Sell SAirTransformation, SBrokerage&InvestmentMgmt, and JapanSmallerCompanies.

My portfolio market exposure after this weekend’s changes
IRA #1 – 100% invested
IRA #2 – 20% invested

Paul Volcher became federal reserve chairman on 8/6/79 and within a year the inflation rate was at 14% and the DJIA started a decline of 16%. Alan Greenspan became federal reserve chairman on 8/11/87 and on 10/19/87 the DJIA fell 23% and from the market high to low that year was 36% and inflation soon hit 5%. Ben Bernake became federal reserve chairman on 2/1/06 and within a 2 years the DJIA started a decline of 53% and inflation hit 5%. Bernake is leaving in January – you have been warned.
Now the government measurement of inflation has changed over the last 25 years to make much lower regardless of the reality, just like the government has done with the unemployment rate. By the way the government is now working on a change to the calculation of gross domestic product. The GDP number is too low and it makes them look bad so they are going to redo the calculation to make it higher.

On average it was a good week, but not very good. The sum of the deviations was just barely higher. This next week, being the month end week, is a time when the big investors buy more of what they own to make the their portfolios look better.

The sum of the deviations (904,672,674) is not up for the last two weeks – not time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are not up – not a time to buy.

My current investments:
SAirTransportation has a price of $49.89, a sell price of $49.17, a relative rank of 27, and is a hold until it falls more or I need to buy something else.
SAutomotive has a price of $52.53, a sell price $50.50, a relative rank of 01, and is a hold.
SBrokerage&InvestmentMgnt has a price of $63.66, a sell price $62.44, a relative rank of 14 and is a hold.
JapanSmallerCompanies has a price of 12.79, a sell price 12.75, a relative rank of 11 and 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 – 80% invested

After the market closed Thursday Investors Business Daily changed their market outlook to market in correction. That says it is not a time to buy, it is just a time to sell anything if your gain looks like it may become a loss. About the only bright spot in my list of Fidelity funds is SGold fund. On my web site, in addition to the top 20 funds on a 39 week deviation from a smoothed moving average, the top 20 funds based on a 13 week moving average and a 78 week are also listed. SGold moved from the 120 rank fund – out of the 130 I follow – last week to the number 1 fund this week on the 13 week list. EmergingEMEA, GolbalCommodityStock, TotalEmergingMarkets, and SGold are the only 4 funds whose deviation have improved over 2 weeks. If you want to take a shot, this may be the time to look at SGold. If you are into ETFs, over the last week, USLV (triple long silver) is up 42%, NUGT (double long gold stocks) 37%, AGQ (triple long silver) 27%, DRV (triple short real estate) 22%, and GDXJ (triple long smaller silver stocks) 17%.

It was a bad week and all the funds I own went down. Only SBiotechnology fell enough to sell, having fallen more than 5% from a previous weekly close. I own SBiotechnology in my IRA#2 and in my 401k (which allows me to buy any fund Fidelity offers).

The sum of the deviations (1046,904,672) is not up for the last two weeks – not time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are not up – not a time to buy.

My current investments:
SAirTransportation has a price of $49.34, a sell price of $49.17, a relative rank of 36, and is a hold until it falls more or I need to buy something else.
SAutomotive has a price of $52.16, a sell price $50.50, a relative rank of 01, and is a hold.
SBrokerage&InvestmentMgnt has a price of $63.28, a sell price $62.44, a relative rank of 16 and is a hold.
SBiotechnology has a price of $155.44, a sell price 160.31, a relative rank of 03 and is sell.
JapanSmallerCompanies has a price of 12.89, a sell price 12.75, a relative rank of 04 and hold.

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

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

This earlier this week Investors Business Daily changed their market outlook to uptrend under pressure. The interpretation of that market outlook is proceed with caution and be ready to take defensive action. Basically it is an indication that this is not the best time to invest. The next step may be confirmed up trend – the best time to buy stocks. Or it may be market in correction – avoid making new buys and lock in gains and cut short any losses. Based on historical standards this bull market is long over due for a correction. I mentioned gold last week. Watching the the prices and 50 day moving average for GLD indicates it may have made a bottom. There is no reason it should repeat the pattern it made in the late 70s, but it is something to watch.

One of Fidelity’s stupid rules on selling mutual funds is the round term trade rule – or hold it for 30 days or we will yell at you and may not let you buy again if you do it too much (4 times). My selling of JapanSmallerCompanies earlier this year resulted in Fidelity yelling at me. I hung up on them after strongly suggesting it was a stupid rule. However if next week should be time to sell something, I will have owned everything at least 30 days so will not break their stupid rule.

The sum of the deviations (943,1046,904) is not up for the last two weeks – not time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are not up – not a time to buy.

My current investments:
SAirTransportation has a price of $50.90, a sell price of $49.17, a relative rank of 17, and is a hold.
SAutomotive has a price of $52.59, a sell price $50.50, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $64.63, a sell price $62.44, a relative rank of 14 and is a hold.
SBiotechnology has a price of $162.32, a sell price 160.31, a relative rank of 01 and is hold.
JapanSmallerCompanies has a price of 12.99, a sell price 12.75, a relative rank of 06 and 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 those following gold is Gary Kaltbaum whose nightly radio show can be found at www.garyk.com. He points out that in the economically stressful times of the late 70s, gold went up over several years, fell by 50% in a year or two, and then went up 700%. During these economically stressful times gold has gone up for many years, fallen by 50% over the last year+, and is up about 9% since late June. Perhaps it is time for another 700% gain. Something to watch and the easiest way to watch it is with the ETF GLD.

I have received a couple of emails on the incorrect subject and error in a quote in my weekly emails. True. The errors did not influence any of my investment decisions and I will try to avoid those problems in the future.

The sum of the deviations (997,943,1046) is not up for the last two weeks – not time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are not up – not a time to buy.

My current investments:
SAirTransportation has a price of $51.76, a sell price of $49.17, a relative rank of 13, and is a hold.
SAutomotive has a price of $53.16, a sell price $50.50, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $65.73, a sell price $62.44, a relative rank of 10 and is a hold.
SBiotechnology has a price of $168.75, a sell price 160.31, a relative rank of 01 and is hold.
JapanSmallerCompanies has a price of 13.29. a sell price 12.75, a relative rank of 05 and 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

Investors Business Daily (IBD) presented a webinar a couple of weeks ago which is well worth watching. Most of their webinars are good, but this one covered an investment method which requires very little time. You can view the webinar at investors.com. Each evening IBD presents a IBD Market Wrap at about 7pm which you can view at their web site. It is a good daily technical review.
One of the more outspoken critics of the where the US economy is heading is Ann Barnhardt. Feel free to review any of her presentations on YouTube. One presentation, a little dated, is here.  Do not watch any of her YouTube presentations if you have a tendency to get depressed. One of her points is that the US has to keep interest rates at zero because interest payments on the national debt will collapse the nation if normal rates returned. She covers a brief review of the Cloward-Piven strategy and since the US has more people (100+ million) getting money from the US government than working, the strategy seems to be progressing.

The sum of the deviations (921,997,943) is not up for the last two weeks – not time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are not up – not a time to buy.

My current investments:
SAirTransportation has a price of $51.13, a sell price of $48.57, a relative rank of 07, and is a hold.
SAutomotive has a price of $51.30, a sell price $48.89, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $64.47, a sell price $61.27, a relative rank of 10 and is a hold.
SBiotechnology has a price of $164.23, a sell price 156.07, a relative rank of 01 and is hold.
JapanSmallerCompanies has a price of 12.98. a sell price 12.75, a relative rank of 05 and 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

So I was wandering through www.fidelity.com looking for it to give me some short term performance on Fidelity funds. However, Fidelity’s short term is one year (not counting year to date which is not a fixed time frame). Fidelity has 262 Fidelity funds open to new investors. When you sort them down by the one year return through 6/30/13 it says you should have invested in Select Automotive Portfolio back on 6/30/12 and you would be up 47.01% Nothing like hindsight. However if you are looking for some sort of longer term analysis try this link which I’ve sorted by 1 year return.  While I am always happy when the market is going up and I am fully invested, my obvious concern is what next. Paul B. Farrell is a writer for www.marketwatch.com. His 17Jul13 commentary is titled “Critical Warning No. 17: Dow 5,000, crash of 65%”. You can read it here. I read a couple of the other 17 he lists in the article and felt the one by Stockman was very interesting.
When you get depressed by all of Farrell’s commentary, you may enjoy a commentary by another Marketwatch writer – Jennifer Waters. You can read it here.

The sum of the deviations (577,921,997) is up for the last two weeks – time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing time to invest. Both trends are up – time to buy. However, I am fully invested so have will buy nothing.

My current investments:
SAirTransportation has a price of $50.96, a sell price of $48.41, a relative rank of 09, and is a hold. 
SAutomotive has a price of $51.46, a sell price $48.89, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $64.29, a sell price $61.08, a relative rank of 11 and is a hold.
SBiotechnology has a price of $164.28, a sell price 156.07, a relative rank of 03 and is hold.
JapanSmallerCompanies has a price of 13.42. a sell price 12.75, a relative rank of 01 and 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

The Federal Reserves Board’s mandates are low unemployment and low inflation. So the question is, when viewing their actions, what are they accomplishing. http://www.zerohedge.com/node/476290 Just in case you have never followed Rick Santelli, several years ago (back in 2009) in one of his comments provided one of the sparks to start the Tea Party – he is really correct and right on target. http://www.youtube.com/watch?v=zp-Jw-5Kx8k Take a look at some of his other youtube comments. He tells it like it is.

The sum of the deviations (449,577,921) is up for the last two weeks – time to invest.
The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing time to invest. Both trends are up – time to buy. SBiotechnology is #01 and SAutomotive is #02 and I own both. JapanSmallerCompanies is #03 and its deviation has been increasing for the last 2 weeks so is a buy. I probably should not have sold it in May, but when a fund starts to fall I never know if it is going to continue or bounce back

My current investments:
SAirTransportation has a price of $49.10, a sell price of $46.65, a relative rank of 37, and is a hold until if falls below the sell price or I need to sell it to buy something else.
SAutomotive has a price of $51.01, a sell price $48.46, a relative rank of 02, and is a hold.
SBrokerage&InvestmentMgnt has a price of $63.28, a sell price $60.12, a relative rank of 14 and is a hold.
SBiotechnology has a price of $161.59, a sell price 153.61, a relative rank of 01 and is hold.
JapanSmallerCompanies has a price of 13.11. a sell price TBD, a relative rank of 03 and is a buy in IRA#2.

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

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

Last week on my way to Disney, I was listening to an early June Gabriel Wisdom show interview with Larry Pesavento of www.tradingtutor.com. Pesavento called the 08 market decline a week or two before it happened saying his technical indicators indicated a severe decline happening almost immediately. On this latest interview he said his indicators were more negative than they were in 08 and the market would go lower in this crash. Another interview on a later show was with Bennett McDowell of www.traderscoach.com. His indicators show the DJIA will increase within the next one – two years to at least 18k and possibly 21k. Now that you know exactly where the market is headed, you can invest accordingly.

 

My indicators say it is time to buy something. Investors business daily says the market is in correction. The S&P500, DJIA, Nasdaqcomposite, and almost every other index is above its 50 day moving average and the going up.

 

The sum of the deviations (328,449,577) is up for the last two weeks – time to invest.

The DJ Wilshire 5000 index is above its 50 day moving average and the average is increasing – time to invest. Both trends are up – time to buy. SAutomotive is #01 and I own it in IRA#2 but it is a buy in IRA#1. JapanSmallerCompanies is #02 but its deviation has not been increasing for the last 2 weeks so it is not a buy. SBiotechnology is #03 and is a buy in IRA#2.

 

My current investments:

SAirTransportation has a price of $48.13, a sell price of $46.34, a relative rank of 21, and is a hold until if falls below the sell price or I need to sell it to buy something else.

SAutomotive has a price of $49.58, a sell price $47.10, a relative rank of 01, and is a hold in IRA#2 and a buy in IRA#1.

SBrokerage&InvestmentMgnt has a price of $61.48, a sell price $59.58, a relative rank of 15 and is a hold.

SBiotechnology has a price of $150.15, a sell price TBD, a relative rank of 03 and is a buy in IRA#2.

 

My portfolio changes this weekend:

IRA #1 – Buy SAutomotive

IRA #2 – Buy SBiotechnology

 

My portfolio market exposure after this weekend’s changes

IRA #1  –  100% invested

IRA #2  –   80% invested