TAPE dealt with good news on US GDP growth of 4.6% & higher consumer confidence. Indices closed in upper range.
S&P 500 @ 1982.85, high 1986.37, 1966.22
RSI @ 48.07
CMF @ 0.076
Internals were :
UP volume led by 3.46 to 1 in NYSE & 4.35 to 1 in Nasdaq
Advancing stocks led by 2.73 to 1 in NYSE & 2.09 to 1 in Nasdaq
Net new 52 wk lows were leading by 116 in NYSE & 53 in Nasdaq
VIX Down 5.05% @ 14.85
Oil @ $93.54
Gold @ $1215.40
Canadian $ @ 88.36..lowest level this year...
Stocks which were UP 1% or more included LULU MU NXPI SWIR TSL BBRY GTAT EXPE YHOO LNKD AAPL
GRPN BABA FB LVS KOG JKS DNKN CMG
EBAY YUM FFIV WB FSLRHIMX SNDK
AMCC LSCC C NFLX PANW M SPLK
SBUX TRLA Z WYNN TRIP....
Here is my weighting :
LULU 23.50%
SWIR 21.18%
MU 19.81%
EGO 19.42%
NXPI 11.10%
AKS 4.99%
Exposure 195%
Next post by 2 PM on Sunday.
BLOG does NOT give buy or sell.
Saleem
2 comments:
Hey Saleem,
A wild week ended with the portfolio down 3.62% versus the S&P's -1.37% and the $RUT's -2.41%.
Weekly Winners: none
Weekly Losers: all, "best" GS (-0.78% upon sale), "worst" JKS (-9.2% upon sale)
YTD Info:
Portfolio: +0.50%
S&P 500: +7.28%
Russell 2000: -3.81%
I trimmed a few cyclical stocks early in the week to try and prevent more downside. I attempted to nibble back at a long on Wednesday with YY, but the rallies were short-lived, and finally the brutal week ended on Friday with me liquidating the portfolio.
Cash: 100%
Although I expected a "tricky week" per my last weekend's commentary, the vicious selloff Thursday after what seemed like stabilization on Wednesday really caught me off guard. After taking into consideration the lack of underlying support, combined with more technical breakdown, I thought it best to scrub the portfolio clean and start over.
Within the portfolio I had let way too many stocks drip downward for weeks, or miss out on great selling opportunities, as overall the portfolio was doing relatively fine. Given the market we are now in, and one I expect to continue, at best I think only a select group of stocks will do well. This means paying more attention to individual charts and price action instead of buying a story or name and waiting for something good to happen.
As for the market overall, the $RUT has definitely broken. Although it was up for debate this past weekend, this week confirmed it by acting again worse than the $SPX and falling well below the 50 and 200 DMAs. We also see the 50 DMA under the 200 DMA (death cross) and the 200 DMA sloping downward for the first times since 2012, and in both those 2012 cases it was extremely short-lived. This time, with the double tops of early March and July at ~1210, and the lower high of ~1180 earlier this month (matching a "lower" high from mid-January), and the significant underperformance to the $SPX this year, many technical factors are lining up to signal larger downside. We are currently in a band that has provided support before and so downside might not be imminent, but we are tracing out classic topping patterns here.
The $SPX has held in better than the $RUT, but is also showing signs of cracks. We are starting to experience much greater volatility on a daily basis, usually evidence of less liquidity and confidence. The biggest volume day in six months coordinated exactly with the overall intraday top set on Sept 19th, also the day of BABA's IPO. Could these things be a coincidence? Probably not. Given the $SPX is full of quality, proven companies, investors will be reluctant to sell outright, but I don't see the power behind the buyers to bring the overall market into a firm uptrend again. If we can see some more positive economic developments in Europe and China, the bulls may have room to charge again, but for now, I think it wise to take profits on pops.
As we approach a number of key events this week including the ECB meeting (expectations too high already?) and the US non-farm payrolls (bad is bad, good is bad?), I expect volatility to again rule. We may see situations where we rally into the events, but then "sell the news". If this indeed happens, I think it is more indication that the market direction has turned for the worse. It is important we recognize large shifts in trading patterns.
Good luck to all! :)
Stocktrader
Hi Stocktrader,
My portfolio was down 3.49% for the week which is pretty close to what you suffered.
This market has surprised many by turning UP when everyone was expecting a further downdraft...
I am expect a fast move UP.....
Saleem
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