Mar 15

Weekend Review and Watchlist

I spent the last week in the UK on vacation and there’s nothing like a bit of distance from markets both physically and emotionally to help give you some much needed perspective.

Each week in these posts I’ve highlighted the key trends at work globally and domestically, and although I don’t enjoy feeling like I’m saying the same thing every week, the fact remains despite the volatility, from a trends perspective very little has changed.

The US continues to underperform the rest of the world, and within the US, small caps and biotech continue to show relative strength. We’re also seeing more financials make it to our watchlist.

Let’s start with a quick overview.

Germany’s $DAX recorded its ninth-straight week of all time highs:-

 

China ($SSE) is back for another test of those highs:-

 

Japan via $EWJ is following through:-

 

The Russell 2000 ($RUT) looks all set to resume its uptrend after a tight consolidation of that breakout:-

 

Here’s the Russell’s ($RUT) huge week relative to the S&P ($SPX),

 

and here’s Biotech ($IBB) relative to the S&P ($SPX):-

 

The new highs in global markets continue to suggest US weakness is isolated, and a rudimentary look under the hood of the US itself reveals there are still plenty of stocks and sectors performing well if you’re prepared to look beyond the big indices. Do more of what’s working, less of what’s not.

Our Marketfy portfolio is certainly working, gaining a further 1.0% to take our performance to +8.7% YTD vs -0.3% for the S&P.

Full analysis and commentary on current signals, as well as entry/exit posts, additional trade ideas, and a comprehensive watchlist is available here.

Healthcare remains the most heavily represented sector in our watchlist this week, followed by consumer discretionary and then financials, which continue to improve.

Here’s a sample of just 8 names:-

$WFC

 

$KEY

 

$HIG

 

$JAZZ

 

$REGN

 

$VAR

 

$LB

 

$RAD

Full analysis and commentary on current signals, as well as entry/exit posts, additional trade ideas, and a comprehensive watchlist is available here.

 

 

 

 

 

 

Mar 06

Weekend Review and Watchlist

​The market began the week with a fresh all time high and weakened thereafter, culminating in Friday’s slump on a better than expected payrolls report. Of course that’s not how the headline writers will parse it, but we’ll let them wrestle with that one. Causality of every daily movement is their concern. Ours is to follow trends and manage risk, and we’re truly seeing the benefit of that approach so far this year.

All of the themes I’ve mentioned in previous weeks remain in place. European markets and Japan continue to outperform the US. Within the US, small caps continue to outperform large caps.

Here’s the $RUT relative to $SPX:-

 

Biotech continues to make new highs, shown here via $IBB relative to $SPY:-

 

Among the nine S&P sector SPDRs Consumer Discretionary ($XLY) remains the strongest of all, and after Friday’s sell-off remains the only one still above its 20EMA:-

 

The next best is Technology ($XLK):-

 

Healthcare also remains strong, boosted by the aforementioned Biotech sector, but beyond that it starts to get messy, with Materials coming under pressure, and Financials and Industrials testing MA support.

Consumer Staples pulled back sharply from their recent highs, and Utilities suffered an ugly 200-day MA break in wake of the huge decline in bonds.

Our Marketfy portfolio finished the week with a small gain of 0.3%, quite an achievement given the market fell 1.6% and we had two exits during the week. Our portfolio is now +7.7% YTD vs +0.6% for the S&P.

We had two exits; $BABY, which had triggered last Friday for Monday’s open, and $RGLD for a small loss midweek, which proved to be a well-timed exit as it later got hit hard in Friday’s sell-off falling a further 9%.

That leaves us with 11 names and around 12% cash, part of which we’ll use for a new entry on Monday which I’ll post separately.

Full analysis and commentary on current signals, as well as entry/exit posts, additional trade ideas, and a comprehensive watchlist is available here.

Our watchlist shows some further deterioration this week. Many of the names that have been there for a while still have reasonable setups, but they are also at the bottom of their recent ranges, suggesting that although they retain the potential to stage a strong breakout, it would take even less to see them break down completely from here.

Of more interest to me is where the new names are coming from, and despite the middling display from $XLF which is dominated by the big-name money center banks, there is real strength to be seen in regional banks and second-tier financials.

Here’s a sample of 8 of the 24 names:-

$SBNY

 

$PNC

 

$SCHW

 

$LNC

 

$GILD

 

$VAR

 

$RMD

 

$RAD

Full analysis and commentary on current signals, as well as entry/exit posts, additional trade ideas, and a comprehensive watchlist is available here.

 

 

 

 

 

 

 

Older posts «

» Newer posts