THIS BLOG RATES THE S&P 500 BUY/SELL/OR HOLD EACH DAY WITH 2-GOALS FOR LONG TERM INVESTMENTS: (1) PRESERVE CAPITAL (2) BEAT THE S&P 500.
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Friday, October 18, 2013
All You Need to Know About Investing: Don’t Fight the FED
PERHAPS THIS IS
ALL YOU NEED TO KNOW ABOUT INVESTING: Don’t’ fight the FED.
Friday, the S&P finished up 0.7% to 1745 (rounded) at the close.
VIX fell 3% to 13.04.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks advancing is 57%. (A
number above 50% for the 10-day average is generally good news for the
New-highs outpaced new-lows Friday, leaving the spread
(new-hi minus new-low) at +442 (it was +308 Thursday).The 10-day moving average of change in the
spread is plus 33.
Market Internals remain Positive on the market for this
short term indicator.
The overall long-term NTSM analysis is BUY again at the
I haven’t gone back into the market for the reasons I
noted yesterday, Thursday.Here are a
few more reasons I’m waiting: Volume was
more than 25% above normal (monthly average) on the NYSE today.Given the up day, I think it is a combination
of short squeeze and possibly some panic buying.The S&P 500 is near its upper trend line
so there should be better buying opportunities ahead.The S&P 500 still has not cleared the
triple-top concern that I have. I want to see the index significantly above its
old high. Today it closed 1% over the old high.
MY INVESTED POSITION
I remain about 20% invested in stocks as of 5 March
(S&P 500 -1540).The NTSM system
sold at 1575 on 16 April.(This is just
another reminder that I should follow the NTSM analysis and not act emotionally
– I am under-performing my own system by about 2%!)I have no problems leaving 20% or 30%
invested.If the market is cut in half
(worst case) I’d only lose 10%-15% of my investments.It also hedges the bet if I am wrong since I
will have some invested if the market goes up.No system is perfect.