Guardian Checklist for Thursday 3/06/08
Published Wednesday 3/05/08
by Mark S. Young , President of Equity Guardian Group, LLC.
Investment Management & Research
Intermediate-term Outlook (weeks):
Seasonal Cycle: Positive.
Coppock Breadth Indicator: Negative. The CBI was up 0.2 to 229.6, 0.4 beneath the exponential.
Weekly MACD: Neutral.
Bull/Bear Market Indicator: Bear.
Conclusion: We are in a Cyclical Bear Market. This is just a condition but it means more care must be exercised. The Seasonal Cycle is positive. The Weekly MACD is still negative.
Short/Intermediate-Term
NYSE Cumulative A/D Volume: Negative.
ITBM: Negative.
Summation: Negative. Turning.
KTT*: Buy. Unconfirmed.
CCI Daily: Positive.
10-day ARMS: Neutral.
MACD Daily: Sell. That's usually a reliable fade.
21-day MA: Negative.
Conclusion: Longs are marginally favored.
Short-term
Stochastic Turn Spotter: Neutral.
VIX 30': Neutral.
MACD 60': Positive.
Moving Averages: Negative. Watch the 1340-1348 area.
Conclusion: Longs are favored, but watch the moving averages for confirmation.
Last time, I said that the key to further rally would be getting above 1335 and staying there. We poked above only to fall apart, only to come back right to the break down point. Interesting.
The market fell right to volume support and bounced smartly. That's what a market that wants to rally will do. The come back, too was a change of pace.
Now, don't get me wrong. This is still technically a Bear market and it's still acting like it, but today's action was a bit different and that's a good sign.
Nothing good happened to breadth and the daily trend is still negative. The hourly is mixed. Sentiment supports.
The daily MACD gave a sell yesterday which is a Short-term Buy. There's an 87% chance of higher prices within a couple days. I suspect that we get it.
KTT traders are waiting for a turn up.
Not everyone likes a short-term trading model, and would like something that hangs onto bigger moves and reflects a less frenetic trading pace. If you want to know how I would trade based upon the big picture and the sentiment, the following tracking portfolio is it.
Ideal ETF Portfolio (tracking portfolio):
50% long DIA at 127.54.
50% long UWM at 50.61
I'm about fully long and nervous. We may lighten up here.
Mutual Fund Models Position Summary
1) STAMP
2) Rydex Naz Trader
1)*Real Money* Seasonal Trading Asset Management Program (All weightings are approximate)
75% Money Market.
25% 2X Dow long fund
I may go into the 2X Naz fund if I see a shot.
This is a very conservative approach (~1/3 the risk of the market), using both long and short funds as well as the occasional favored sector/stock idea. All performance is net of fees, commissions, and interest. Your results may vary, especially if we trade for our accounts intra-day, and standard disclaimers apply. We use discretion. For further information, call us at 1-800-769-6980.
2) Rydex Naz Trading Model
Weekly Trend: Negative.
Rydex Asset Trigger: Neutral.
MACD Risk Reducer: Negative.
CCI Entry Improver: Buy.
NDX Stochastic: Buy.
0% Money Market.
100% Velocity.
Long 50% position in Velocity. Bought another 50% position in Velocity at the late cutoff. Barely made it.
QQQQ Trading model: 100% long via the QLD at 68.32. We sold the longs from 47.47 and 46.95 at 42.98.
Trading is not only risky, but trading different vehicles also entails unique risks. Traders can lose a significant amount of money trading options, and more in futures. Mutual funds have certain trading limitations that must be understood before you undertake any market timing approach. Traders should discuss the forgoing issues with their broker before taking any trades. We aren't your advisor unless you have a signed contract with us. You are responsible for your own trading decisions and results. Take your time and do your homework. Past performance is no indication of future returns.
See our Web site for more information.
http://www.EquityGuardianGroup.com
Mark Young
President
Equity Guardian Group, LLC.
859-393-3335