Weekly SP-500 Trend Commentary – 20111015

*** Status: Market Bullish – Sector/Index Funds ***

The SP-500 Index continued up this week and we are now again at the ~1225 resistance level. This time we have several indicators flashing bullishness, but is it truly different than the times we approached this level in the past. I looked back at the Vanguard ETF rankings for the previous times we recently approached this level (8/31 & 9/16 – Bond Funds ranked highest). This time we have several Sector Funds highly ranked and the Bond Funds have dropped. We may now be at the beginning of a new bull move.

  The general market trading filter I use (SP-500 53 day CCI) is at +104 indicating Market Up which is up from -48 last week. My multiple composite SP-500 indicators on the daily chart are both now Bullish with the Blau Ergodic Composite Indicator bullish and the MACD composite indicating an up trend. The SP-500 index is down ~12% from the recent May high of 1370. The CCI(53) indicator for all the indices on the right of this page are now mainly bullish with the exception of the IEF bond ETF and the Junk Bond Fund JNK.

The Guppy Plot for the SP-500 Index is transitioning, with the Fast moving averages starting to cross over the Slow moving averages. The average slope of the Fast Moving Averages is now positive, as is my main indicator, the average slope of the Slow Moving Averages. The ADX components are now bullish, and the Stoch has moved up.

We’ll see what the next week brings. We don't try to forecast the market here, rather we just monitor the current conditions and react accordingly. I hope you find this blog helpful. If you do, why not leave a comment.

Rankings:

This week's Rankings continue have transitioned to have Sector and Index Funds at the top.  Ranking scores are color coded to indicate positive ranking scores (rate of change / volatility) in green, and negative ranking scores in red. Overall the list is sorted by overall rank but the score that makes up the rank can be positive or negative depending on the recent rate of change. The full list of the funds that are ranked can be found under the Funds tab. Current Rankings of the Funds can be found under the Rankings tab.

What Others are Saying (all free sites): Overall Bullish

AAII Sentiment:  40% Bullish / 24% Neutral / 36% Bearish

Investors Intelligence: 34% Bullish / 46% Bearish

Barchart: 24% Buy (last week 72% Sell)

Bulkowski: Bullish (CPI= 99% - last week 80%)

Buy-Don't Hold: Buy (4)

Consensus Traders: 55% Bullish / 21% Neutral / 24% Bearish (SPY)

MTR Investors Market Timing Model: Market Up

MyPlanIQ Trend Score: -0.52% (SPY -5.08% last week) 

10 DMA New High - New Low Ratio: Bearish (see Chris Perruna for explanation)

Pattern Trapper: Bullish (SPY)

Stock TA (SPY): Neutral

Stock Trends: Bearish

Wishing Wealth: Up Trend

TheWizard: Less Bearish (SP-500 Long Term Signal)

dshort.com: Cash (Note - monthly SP-500 10-EMA signal)

Click on Charts to Enlarge

SP-500 Daily Chart for October 15, 2011

SP-500 Daily Guppy Chart for October 15, 2011

Fidelity, Vanguard, Schwab, and Profunds Fund Rankings - 20111015

Last week the Bond funds started to drop in the Rankings. That trend continued in a big way this week with the Stock Index Funds now at the top of the Rankings. Remember that even though a Fund is ranked in the Top 15, if it is colored red it is in a downtrend. Green coloring indicates positive rate of change over the past period, and red indicates negative rate of change. For the full list of funds that are ranked see our Funds listing.

Selected Fidelity Funds Rankings

Selected Fidelity Funds Rankings for October 15, 2011

Selected Vanguard ETF Rankings

Selected Vanguard ETF Rankings for October 15, 2011

Selected Schwab & Profunds Funds Rankings

Selected Schwab & Profunds Funds Rankings for October 15, 2011

Retirement Strategy Update 20111015

We saw a market transition start last week with the Bond Funds dropping. That trend has continued and there are several changes to the spread sheet with the Bond Funds falling out of favor, and the broad index funds gaining ground.

One thing I've focused on is developing a strategy for my retirement funds. Ever since pulling my funds out of the market in late 2008, like many others I hesitatedt to reinvest - at least not without a plan. Two books that influenced my plans are The Ivy Portfolio and How a Second Grader Beats Wall Street. In general both of these books profess the use of broad index funds versus individual stock picking. The Ivy Portfolio adds a mechanism for market timing, such as the 10 month moving average and adjusting monthly. Dshort provides updates on The Ivy Portfolio strategy each month.

Below is a summary of retirement funds considered by mybestfunds.com with three different market timing strategies indicated: the average slope of the Guppy Slow moving averages, the CCI(53), and the 200 day simple moving average. In a future post, I'll provide backtesting results for each of these strategies. I plan on providing a weekly update on these funds.

Retirement Strategy Update for October 15, 2011