Indices closed UP with S&P 500 & Dow making new all time highs. S&P 500 & Dow closed @ absolute high point of the day while Nasdaq missed it by only 1.11 points. Jobs report was above consensus.
S&P 500 @ 1949.44, low 1942.41
RSI @ 73.25
CMF @ 0.517...highest level in a year
Internals were :
UP volume led by 2.58 to 1 in NYSE & 2.58 to 1 in Nasdaq ( no typo)
Advancing stocks led by 2.89 to 1 in NYSE & 2.50 to 1 in Nasdaq
Net new 52 wk highs were leading by 344 in NYSE & 122 in Nasdaq
VIX Down 8.13% @ 10.73, new 52 wk low & closed @ the lowest point of the day...
Oil @ $102.66
Gold @ $1252.50
Canadian $ @ 90.64
Stocks which closed UP 1% or more included
WUBA LULU MU OWW SWIR
LEN EXPE YHOO COH LNKD AMZN
BIDU KORS KOG CSIQ CMG SU YUM X
ONVO INVN YNDX BSFT BRCM JCP PANW
GMCR SRLD CCJ DATA CSOD MGA MS WLT GS
TRLA ......
Here is my weighting @ close :
LULU 30.90%
WUBA 22.32%
SWIR 17.42%
MU 14.68%
GRPN 8.11%
OWW 6.57%
Exposure 183%
Next post by 2 PM on Sunday.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hey Saleem,
A great week for the markets was also one for the portfolio. It gained 3.06% versus the S&P's +1.34%.
Weekly Winners: DATA (+9.5% upon sale), AAL (+6.7% from purchase), GM (+5.3% from purchase), GS/MS/SPLK/DHI (>3+% from last week or from purchase this week)
Weekly Losers: YELP (-1.4%), WLH (-0.9%)
YTD Info:
Portfolio: -0.54%
S&P 500: +5.47%
Russell 2000: +0.13%
I was in accumulation mode all week, only selling a few things that either were underperforming (CTRL), or too far outperforming (DATA). Here's the current portfolio:
Anchors (avg forward PE=7.5): AAL-13.6%, GM-12.3%
Housing-Related: DHI-9.9%, AXLL-9.5%, WLH-7.0%
Big Brokers: GS-9.0%, MS-8.6%
Software/Internet: YELP-6.1%, CSOD-5.9%, SPLK-5.8%, PFPT-5.5%
Cash: 6.8%
New Positions: CSOD AAL GM GS DATA(6/4) PFPT
Closed Positions: CTRL DATA(6/6)
Add-ons: DHI MS(6/2)
Trims: MS(6/3) SPLK
With negative catalysts fading, and economic growth on a steady pace higher, fundamental momentum should remain favorable, and therefore one of the few remaining questions at this time is how high can we go? The RSI currently sits at 73.25, and we have to go back to May 15th of last year to see a higher print, 73.34. In just over a month following that date, the S&P lost 6.8% from peak to trough. Is that what we should expect here? I don't think so...
The better comparison I believe is the previous RSI peak of 74.41 set on January 25th, 2013. The market had just come out of roughly a five-month consolidation from late 2012 to early 2013, exhibiting a reverse head-and-shoulders pattern, before finally breaking to new highs, and then ramped for another nearly five months, gaining 11.1%, even from that Jan 25th RSI high! Given our recent multi-month consolidation, also exhibiting a reverse head-and-shoulders pattern, I think this is the start of a move, rather than an end. It is important to be positioned as fully as possible.
Although some sentiment readings show extreme bullishness, the retail and trader sentiment is neutral at best, and many potential participants are not involved. I think we could see a tailwind of fund flows as the market continues to grind higher. In these environments, small caps tend to do very well, as small amounts of money flow affect them greatly. Also, certain individual stocks make large moves based on a turn in fundamentals or sentiment. I will be looking for these kind of breakout stocks.
In summary, I don't have much to say on the fundamental and economic front--it's pretty much steady as she goes. Given our long resting period, there should be plenty of sideline money to grind the market higher for months. During these times, we tend to see only single moderate down days before moving higher again. It is important to stay convicted and patient with the strong stocks.
Good luck to all as we continue our new bull phase! :)
Stocktrader
Hi Stocktrader,
Excellent outperformance compared to indices.
More of the same this week.
Saleem
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