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The stock market has had an explosive start in January with the S&P 500 (SPY) and the Nasdaq 100 (QQQ) completing their upside objectives at 276.00 and 164.00 respectively. These are now levels of support if the market were to decline.

What to Watch Now For Direction?

SPDR S&P Financial Select SPDR ETF (XLF) Daily Price (Top), and MACD 19-26-9 (Bottom)

The top part of the chart shows the daily Financial Sector SPDR (XLF), an exchange traded-fund (ETF) that tracks a mix of diversified financial service firms, insurance, banks, capital markets, consumer finance and thrift companies. As of 01/217/18, the top holdings of XLF are Berkshire Hathaway B, (BRK.b) 11.50%, JP Morgan Chase & Co (JPM) 11.07%, Bank of America Corp (BAC) 8.61%, Wells Fargo & Co (WFC) 7.87%, and Citigroup Inc. (C), 5.79%. When financials are strong the S&P 500 (SPY) also tends to do well because the S&P 500 index has 14.85% of its holdings in the financial sector, second in weight only to the technology sector (at 23.96% as of 01/16/18).

Financial stocks made a low in September of 2017 and then stalled at the middle channel before breaking out in November 2017. The XLF then went sideways holding the middle channel.  In the start of 2018 the XLF has come to life, up 5.41% outperforming the S&P 500 (SPY), (as of 01/17/18), a bullish sign.  Historically, it’s a sign of a healthy market when financial stocks are strong; showing signs there is economic growth.  The daily upside target is 30.50, now only 1.2% away. Support is at 27.50.

The bottom half of the chart is MACD (12, 26, 9) a technical indicator that measures momentum.  MACD is rising, a positive sign. Keep an eye out for a potential break in the uptrend in MACD (green line).   An MACD turndown now would not favorable because MACD would fail to confirm the price high and instead would form a negative divergence.  This would be a warning the rally could be running out of steam.

The good news is the uptrend in MACD remains intact, and if the rise in MACD continues then MACD will confirm the XLF high.  A break above 30.50 on a closing basis would give higher upside targets to 33.50 coinciding with the weekly upside objective.  (See chart below).

SPDR S&P Financial Select SPDR ETF (XLF) Weekly Price (Top), and MACD 19-26-9 (Bottom)

The top part of the chart shows the weekly Financial Sector SPDR (XLF). The XLF has been in a steady intermediate uptrend since 2016.  The upside objective is 33.50, 13.9% higher from today’s close at 29.41.  Support is at 23.50.  MACD in the lower portion of the chart is still rising and its uptrend also remains in effect.  Therefore, the likelihood is for the XLF to continue to rise.

Just to Sum Up:

Stocks have started 2018 with a bang. Our U.S. equity timing model remains on its October 31st buy, a condition where historically risk has been below average and returns above average. The financial sector has been one of the leaders of the advance, which is a sign of a healthy market.  If the XLF closes above 30.50 then the next higher upside target would be 33.50.    As long as the XLF stays above 27.50 further gains in the financial sector are likely.

I would love to hear from you. Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.


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*******Article published by Bonnie Gortler in Systems and Forecasts January 18, 2018

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

 

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The Dow, S&P 500 and Nasdaq completed its best year since 2013.  Many global markets broke out from long-term down-trends igniting interest among investors, achieving gains of over 20%. In addition, 2017 was one of the least volatile years I have witnessed in my over 35-year career.   Technical indicators have confirmed the highs made in the major averages, and uptrends remain in effect.

The question remains can the rally continue in 2018?

The probabilities are high that further gains are likely.  Our models indicate a positive market climate for the start of 2018.  The bulls remain in control for now.  However, optimism is at extreme levels, (a contrary indicator), investor’s cash is at levels that are the lowest since 2000, and interest rates are rising.

The Moment of Truth for the S&P 500 (SPY): Intermediate upside objectives are close to being met.

The SPDR S&P 500 (SPY) Weekly Price And Channel

The S&P 500 (SPY) is comprised of 500 stocks of the largest companies in the U.S. When you invest in the S&P 500 (SPY), you are getting a broad representation of large-cap U.S stocks with moderate risk.

The top portion of the chart is the weekly (intermediate) SPDR S&P 500 (SPY) ETF and its price channel (purple lines).  The upside channel objective is 276.00 (orange line).  The S&P 500 (SPY) has been in a weekly uptrend since February 2016 (black line), with only a minor penetration.

Until the upside trendline on the S&P 500 (SPY) is broken, where the SPY breaks below 256.00 on a weekly close, no serious threat of a major decline is likely.

The SPY declines in 2017 were less than 3%, much lower than normal. In 2018 look for declines to be larger as volatility picks up and investors decide to lock in some of their profits.

Notice how the SPY is very close to its upside objective. If penetrated it would be bullish and suggest the rally can go significantly higher.   A turn down in the near term without reaching the channel objective at 276.00 would suggest the SPY is ready to pause and potentially pullback to support at 244.00.

The lower portion of the chart is the 12-26-9 MACD, a measure of momentum.   MACD is rising and has confirmed the recent price high made by the S&P 500 (SPY), (orange circle), suggesting the final top has not been reached.   MACD is showing strength instead of weakening momentum.

Summing Up:

Stocks continue their advance to start 2018 after completing its best year since 2013.     There is no serious threat of a major decline unless the S&P 500 (SPY) intermediate uptrend is violated.  Watch for a shift in trend if the SPY breaks below 256.00 on a weekly close.  For now, continue to celebrate and enjoy the ride as the bulls remain in control and the bears remain in hibernation.

I would love to hear from you.  Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.

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*******Article published by Bonnie Gortler in Systems and Forecasts January 05, 2018

 

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

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When was the last time your investment advisor or you hae reviewed your portfolio?  Have you noticed the wider intraday fluctuations in the major averages?  The quiet days of the major averages moving less than ½ of a percent appear to be over.  There are wider swings in the movement of stocks and the market averages each day.  Volatility in the U.S. and international markets has started to pick up.

The good news is our stock market models indicate a positive market climate. Also favorable seasonality remains supporting the stock market, along with the intermediate and long-term trend being up.  However, a bumpier ride may be in store for the next several weeks.

A shift out of technology appears underway. 

Technology stocks have been much more volatile as of late. The selling pressure started before the news that the Senate would approve the tax bill, and further intermittent selling has continued since the bill passed.  Investors have recently rotated into telecommunications stocks, consumer discretionary, staples, financials, and industrials after the approval of the tax bill.  The shift out of technology may be only temporary, but I believe risk has increased substantially in the technology sector since the beginning of the year.

I recommend reducing your technology exposure if you are heavily invested.  The Nasdaq relative strength is now weaker than the S&P 500 and is losing momentum. This could be a warning of a possible short-term pullback in technology that could carry through to the overall market.  In addition this could affect other sectors that are also extended in the near term.   It’s a good idea to keep an eye on the top holdings in the Nasdaq 100 (QQQ), to confirm the shift away from the technology sector. It’s a little early to tell if it’s profit-taking or the start of a larger move lower.

 

 

 Figure: PowerShares QQQ ETF (Nasdaq 100 Index) Weekly Price and Trend Channels (Top), and MACD 12-26-9 (Bottom)

The top part of the chart shows the daily Power Shares 100 (QQQ), an exchange-traded fund based on the Nasdaq 100 Index, and its operative trend channel (purple line). The QQQ includes 100 of the largest domestic and international nonfinancial companies listed on the Nasdaq.  As of 12/5/17, Apple, (AAPL) is the largest holding comprising 12.19%, Microsoft Corp (MSFT) 8.75%, Amazon.com, Inc. (AMZN) 7.63%, Facebook, Inc. Class A (FB) 5.70%, Alphabet Inc. Class C (GOOG) 4.86%, and Alphabet Inc. Class A (GOOGL), 4.23 % totaling 43.36%.

The technology sector has been one of the strongest areas of the stock market this year. The QQQ has made new highs with only a few small pullbacks along the way. The declines were sharp, but never broke the uptrend and were able to recover to new highs.  This time could be different. If investors continue to rotate out of technology, the selling pressure will be magnified and money may flow into other sectors of the market.  If this indeed is the case, a sign would be if the QQQ weakens during the late afternoon trading hours especially in the last hour of trading.

The intermediate price trend remains up as long as the QQQ is above its uptrend line (orange).

Support is at 147.00 and the upside channel objective is at 164.00.  If the QQQ falls below support at 147.00 on a weekly close, the intermediate trend would change from up to down, implying weakness potentially to the middle channel at 140.00 followed by the lower channel at 117.00.

The bottom half of the chart is MACD (12, 26, 9), a measure of momentum. In June, MACD made a high.  The difference between now and June is MACD not confirming the price high made in QQQ.  The negative divergence is spread over 26 weeks.  Time is no longer on the side of the bulls.

On the other hand, MACD has not yet generated a sell, so it’s still possible for MACD to turn up and move higher to confirm the QQQ high.  I am recommending lightening up on technology stocks now.  If you are overly invested in technology stocks, lock in some of your profits before a decline occurs.  An old adage I have learned over my 35+ years “You Never Go Broke Taking a Profit”.   If you do decide to wait, I recommend keeping an eye on the top holdings in the QQQ.  If they start weakening again, have a plan ready in case further selling pressure occurs.

Figure: Daily Price of Microsoft (MSFT), Amazon (AMZN), Facebook, (FB) Apple (AAPL), and 12-26-9 MACD

In the past few trading sessions, technology stocks have been under some selling pressure. Uptrends are in effect for Microsoft (MSFT), and Apple (AAPL).  Since November daily MACD patterns on all of these stocks are weakening, a warning sign a decline may be imminent.  MACD is not yet oversold, below 0, or in a favorable position to support an extended rise.  MACD uptrends (purple lines) have been broken in Microsoft (MSFT), Apple (AAPL) and Facebook, (FB).  Only the MACD uptrend in Amazon (AMZN) remains in effect.

If the top holdings in the QQQ continue to weaken, further gains for the overall market could be jeopardized in the short-term.  For aggressive investors and traders, here are some key levels of guidance.

Microsoft (MSFT) filled its gap from October and has risen the past two days.  Further decline would not be a good sign.  Support is at 77.00 followed by 72.00.  Resistance is at 88.00.

Facebook (FB), has the most disturbing pattern of the group.    FB broke its daily price uptrend this past week.  What is different now?  The weekly uptrend (not shown) has also been violated.  Therefore, the short and intermediate term is now down.  In addition, MACD is now on a sell with a negative divergence in place.  The risk is higher than at any time this year based on the charts.  During the recent quiet market environment where pullbacks have been contained, investors have been profitable buying quickly into weakness. Now selling strength could be a better strategy.   Resistance is 179.50 followed by 184.00.  Support is at 165.00, followed by 161.00.

Amazon (AMZN) peaked in late November, also under some selling pressure, but its chart pattern is more constructive because it remains above its breakout level in October. Resistance is the old highs at 1003.00 followed by 1029.00.   Support is at 1108.00 followed by 1012.00.

Apple (AAPL) made a new all-time high on November 8 at 176.24.  Apple (AAPL has pulled back in a quiet decline but remains in an uptrend. Support is at 163.00.  Resistance is at 175.50.   Many times Apple is a leader in the technology sector.  A break through resistance would imply potential to 185.00. If this were to occur it could boost the entire sector.

Summing Up:

The market as a whole has been extremely resilient. The daily range of the major averages has widened, suggesting volatility could pick up, with an increase in risk compared to earlier in the year. Weakening momentum patterns are clear and spread over time which normally doesn’t work out well.  However, 2017 is not an ordinary market; it’s one that is defying the odds. The short-term and intermediate-trend remain up for now.   If you are overly invested in technology stocks, I recommend you lock in some of your profits before a full-fledged decline occurs. If the QQQ falls below support at 147.00 on a weekly close, the intermediate trend would change from up to down, implying weakness sooner rather than later.

I would like to wish you and your family a happy holiday season full of joy, health, and prosperity.

I would love to hear from you. Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.

Sign up for a FREE 3 issue trial of Click Here: The Systems & Forecasts Newsletter

*******Article published by Bonnie Gortler in Systems and Forecasts December 07, 2017

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

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Fun video with the Maccabeats and a tasty recipe of Low-Fat Potato Latkes

One of my favorite times of the year is the Jewish holiday called Chanukah also known as the Festival of Lights. Time moves by quickly. Our children have grown into wonderful young adults,  I’m so grateful and thankful our family keeps the tradition going each year getting together, sharing our love, and having fun celebrating Chanukah together.

Chanukah in 2017 starts at the sunset on December 12 and will continue for 8 days until the sunset on December 20th. Chanukah is a tradition to give young children gifts for eight nights.   As with other major Jewish holidays, candles are lit, appropriate blessings are made, followed by a festive meal with loved ones.

Wishing all of you who celebrate a very happy Chanukah.

Chanukah celebrates the triumph of light over darkness, of purity over adulteration, of spirituality over materiality.

Chanukah Customs:

  • Eating foods fried in oil — latkes (potato pancakes) and sufganiyot (doughnuts)
  • Playing with the dreidel (a spinning top on which are inscribed the Hebrew letters nun, gimmel, hei and shin, an acronym for Nes Gadol Hayah Sham, “a great miracle happened there”);
  • Giving of Chanukah gelt, gifts of money, to children.

 

Listen to the Maccabeats, Chanukah

potato latkas

Enjoy this delicious recipe for Low-Fat Potato Latkes

Low-Fat Potato Latkes

  • 3 teaspoons vegetable oil, preferably canola
  • 2 pounds russet potatoes (about 4 or 5), peeled
  • 3/4 cup finely chopped red onion (about 1 medium onion)
  • 1/4 cup all-purpose white flour
  • 1 teaspoon salt
  • 1/4 teaspoon freshly ground black pepper
  • 1 large egg, lightly beaten
  • 1 large egg white, lightly beaten

Set oven racks at middle and lower positions of the oven. Preheat oven to 450° F. Prepare 2 baking sheets by brushing with 1 teaspoon oil on each sheet.

Grate potatoes using hand grater or shredding blade of food processor. Place in a large bowl and add onions, flour, salt and pepper; toss to mix well. Add egg, egg white and remaining 1 teaspoon oil; toss to mix.

Drop onto prepared cookie sheets by the tablespoonful and press lightly to form cakes. Bake for 10 minutes, or until golden brown on the bottom. Flip latkes, switch position of baking sheets, and bake about 5 more minutes, or until golden brown.

Transfer to a platter, arranging browned-side up, and serve with no-fat sour cream or applesauce, or both. May be made ahead and stored overnight in fridge. Reheat at 350° F for 10 minutes. Makes about 24 latkes.

Tip: Use the grater attachment of a food processor to simultaneously grate both the potatoes and the onion. Set the shredded material in a colander over a bowl to catch the dripping liquid. When the grated potato-onion mixture stops squishing combine with the egg, egg white and remaining teaspoon of oil as above. Carefully pour out the liquid collected from under the grated potatoes and onions, taking care to save the white cake which has formed at the bottom of the bowl (the potato starch). Add this white stuff to the latke mixture and mix well. Complete the above recipe as written.

Source: http://www.chabad.org/library/article_cdo/aid/773110/jewish/Low-Fat-Potato-Latkes-I.htm

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Happy 2018! I hope you enjoyed the holiday season with your family and friends. My family and I had a great time traveling and it ended all too soon. The time away re-energized my spirit and had me thinking about shifting beliefs and the impact it has on one’s life and overall well-being. My experience has taught me that making even a minor adjustment can result in major changes. How much of a difference do you think that shifting your beliefs and creating change would help you enjoy life more?  The answer is different for everyone. Whether it’s during the holiday season, the start of a New Year, or just another normal day making your well-being a priority is one of the most important decisions in your life. Do so by starting simply by investing in YOU! This can be done all year long, not just during the holiday season, a weekend, or for a special occasion. Taking care of your well-being helps you and everyone around you to live a full and prosperous life. The road can be overwhelming at times so know that I am here to support you.  Together we can seize the moment and create real change in your life.

What about you? A new year with a new beginning signals the perfect time to take small steps toward your goals, desires, and dreams in a consistent way. Throw away the thought of resolutions and think more in terms of making better life choices. Doing more doesn’t always make things better. You approach real change in a strategic manner mixed in with a dose of reality. You will be surprised how good you feel when you focus on one area at a time and with the desire of obtaining what you want. Take charge of your actions, instead of making a bunch of excuses.

You want to make practical decisions based on facts, not opinions or the old played out beliefs that you might have.  Avoid getting caught up in your emotions and reacting to everything and everyone around you. You are the master of your ship. You can learn to respond to others without overreacting. It takes some practice to raise your awareness and keep your composure when things are not going your way. Try pausing and to count to 10 before you respond. Those 10 seconds can seem like forever but believe me, you will be grateful that you waited.

What is the one action you can take that will create the biggest impact in your life? Well, I’m glad you asked.

You have the power to create the changes in your life that will instantly improve your wealth and well-being. Don’t make drastic changes all at once since that will only overwhelm you and could cause you to give up before you have even given yourself a chance to succeed. You will also discover how much your energy will rise and how much easier your day will flow.  By choosing one action step and following through with focused attention will start the ball rolling so you can have a life that is happy and fulfilling while you enjoy inner peace like never before.

11 Simple Ways to Create Change and Improve Your Well-Being

  1. “Believe You Can”.
  2. Take baby steps towards your goals.
  3. Create some quiet time in your day by getting up 30 minutes earlier than normal.
  4. Listen to your favorite music and relax your mind.
  5. Choose something you love to do that you are passionate about.  For example: writing in a journal, prayer, meditation, or exercise. By doing what you love to do you will shift your thoughts into a more positive frame of mind. (I love my time I create for journaling, writing, and exercise, listening to music in the background).
  6. Do less, not more.  Stop now and remove one item that you do often but are not getting the results you want.  Your day will flow better and you will get more done without feeling stressed and not miss what you were doing.
  7. Create a morning and evening routine to begin and end your day that makes you feel good.
  8. Open your arms to change, stretch yourself, and leap out of your comfort zone.
  9. Be kind and compassionate. Be thoughtful of how others feel. Think about what the other person might be going through. Don’t judge them. Remember there are two sides to every story, and sometimes even three.
  10. Be patient and kind to yourself instead of being hard on you.  If you had a little too much to eat or drink, don’t beat yourself up.
  11. Give your body some love.  Create a daily habit to move your body.  Go for a walk or exercise. Start with 5 minutes each day. Expand the time when you can. Exercise not only helps you lose weight, but it can empower and relaxes you so you feel so much better, (like it has done for me).

This time of year is very exciting and can be even more impactful when you learn to set goals to inspire you.

You have the power to create change when you make the conscious decision to have an open mind and to take advantage of all the opportunities that exist around you. This is your life and you can have everything you ever dreamed of. Reach out and make the adjustments so that the best of everything can be yours.

Sending wishes of joy for you and your family.

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The major averages, Dow, S&P 500, and Nasdaq were in a consolidation phase within a low volatility environment. However, in recent weeks intra-day volatility has picked due to concern about tax reform.  When the S&P 500 (SPY) is down 0.5% in one day, it gets your attention, especially since there have been many daily changes of no more than .38% on the up or downside. This leads me to believe it’s only a matter of time before daily trading ranges will begin to widen.   However, with support levels holding and the intermediate and long trends favorable, the odds favor the bulls.

After weeks of consecutive gains, there was some weakness in the tape, along with a loss of momentum in some technical indicators.   Losses for the major averages were minor and much more forgiving than compared to individual stocks.   Many stocks this quarter fell 5% or more and sometimes double digits, especially after earnings misses or modest projections of future sales or earnings.

I continue to believe the Russell 2000 Index (IWM) is a clue to signaling the trend of the overall market.

During the last few weeks, the Russell 2000 (IWM) had been losing momentum, weaker than the Dow, S&P 500, and the Nasdaq, not even able to break the hourly downtrend.  However, a shift in relative strength in favor of the Russell 2000 over the S&P 500 started on 11/16/17, and the Russell 2000 (IWM) is now leading the advance.   This is overall bullish.

Figure: Daily iShares Russell 2000 Index (IWM)/S&P 500 Index (SPY) Ratio (top) and 12-26-9 MACD Ratio (bottom)

 

 

The top part of the chart on page 5 is the daily Russell 2000 Index /  S&P 500 Index ratio (IWM/SPY).  A rising line means the IWM is stronger, and if falling, the SPY is stronger.   After outperforming the S&P 500 (SPY) from the August lows, the IWM/SPY ratio peaked on 10/02/17.  Since then, the IWM/SPY ratio had been trending lower with a series of turn ups (green circles) that were unsuccessful as the IWM moved lower. However, the IWM has broken its downtrend (pink line), after forming a low, implying the IWM will resume its out performance like earlier in the year over the S&P 500 (SPY). This is a positive sign the next leg of the advance may have begun. It also aligns with the fact that historically small caps rally into year end.

In the unlikely event another failure takes place, and the IWM starts to lag, this would not be a good sign for the overall market.

The lower portion of the chart is the MACD of the IWM / SPY ratio.  The IWM/SPY ratio MACD has been on a sell in a steady downtrend from its peak.  However, it’s very positive that MACD has turned up generating a buy and confirming the price turn up in the IWM/SPY ratio (top chart).  In addition, the daily MACD of the Russell 2000 (IWM, chart not shown) is oversold and has given a fresh MACD buy.

Figure: S&P 500 SPDR ETF Weekly Price Channel and upside objective (SPY, top) and 12-26-9 MACD (bottom)

 

Key uptrend and intermediate support remains intact for the S&P 500 (SPY)

The chart above is the weekly SPDR S&P 500 (SPY) ETF and its weekly (intermediate) price channel (purple lines). The upside channel objective is 276.00 (orange line).  The S&P 500 (SPY) is comprised of 500 stocks of the largest companies in the U.S.  When you invest in the S&P 500 (SPY), you are getting a broad representation of large-cap U.S stocks with a moderate risk.

The SPY remains in an uptrend that began in February 2016 (green line).  The declines this year in the SPY have been minor and brief.  If the SPY falls below 245.00, the area where the SPY broke out of its most recent trading range, this would turn the intermediate trend negative and imply weakness towards the middle channel at 212.00.  Until the upside trend line is broken, no serious threat of a major decline is likely.

The bottom half of the chart shows the Relative Strength Index, a measure of momentum developed by Welles Wilder.  RSI is based on the ratio of upward price changes to downward price changes. RSI is 77.15 confirming the high made by the SPY.  When RSI gets above 70 it’s a sign of underlying strength.  It’s bullish the uptrend in RSI from 1/16/16 remains intact.  Short-term weakness is perfectly normal after a large run-up in prices to alleviate the overbought condition.  However, market tops rarely occur when RSI gets over 70- 75.

In Sum:

As long as the S&P 500 (SPY) uptrend remains in effect above 245.00, the SPY is likely to work its way higher toward the upper weekly channel at 276.00.   If the downtrend is broken (green lines) on either price or RSI, a warning sign would be given for a potential change in trend and a short-term correction to begin.

Further evidence higher prices are likely.

Figure: S&P 500 SPDR ETF Monthly Price (SPY, top) and RSI 14 (bottom)

 

The long- term uptrend in the S&P 500 (SPY) that began in 2009 (purple line), remains intact. There was only one false overshoot for two months below the line in 2016 (pink circle).   If the SPY falls below 225.00 this would turn the long-term trend negative.  For now, the bulls remain in control until proven otherwise.

The bottom half of the chart shows the Relative Strength Index.  The monthly RSI is also confirming the underlying momentum in the S&P 500 (SPY).   It’s bullish the uptrend in RSI from 2009 is clearly intact.  It’s also bullish that RSI is at 80.34 (green circle), still rising and showing strength with a higher reading than the previous peak of 77.01 the S&P had in June 2014 (red circle).   It’s highly unlikely a significant decline will occur now with the long and intermediate term trend favorable.

The first decline in the S&P 500 (SPY) of more than 3-5 % will likely be a buying opportunity with at least one more rally attempt before a market top would be reached.

Summing Up:

This is a broad rally that has started after a period of consolidation. Small caps have come to life, now stronger than the S&P 500 (SPY).   Market internals that were weakening and losing strength are now improving. Support levels remain intact.  The intermediate and long-term trends on the S&P 500 (SPY) are up.   As long as the S&P 500 (SPY) remains above 245.00, the SPY is likely to work its way higher towards 276.00.

I would love to hear from you.   Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.

Sign up for a FREE 3 issue trial of Click Here: The Systems & Forecasts Newsletter

*******Article published by Bonnie Gortler in Systems and Forecasts November 22, 2017

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

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Who would have thought the major average averages would be in a steady uptrend since late August?  There has been no decline of more than 3% on the S&P 500 index as the market climbs the wall of worry to record highs. Short term price uptrends and support levels remain intact in the major averages.

The Russell 2000 (IWM) has been in a consolidating pattern since October 4. Several times the IWM has tried to break out to the upside.  However, it’s a bit worrisome the latest rally attempt failed this week. Also a point of concern, investor sentiment is showing very high optimism. In the past, at these levels short-term declines have started.  On the other hand, the Volatility Index (VIX) that measures fear is near its lows, a positive sign, and favorable seasonality has begun.

Watch the Movement of Small Caps Closely

Weakness in the Russell 2000 (IWM) or sudden weakness in Technology stocks (QQQ) would be a sign a short term pullback is likely.  A bullish sign would be if the Russell 2000 (IWM) index were to stop its present decline, reverse and take out the highs made on November 1.  In addition, if the Russell 2000 (IWM) could outperform the S&P 500 (SPY), new 52-week highs begin to expand, and volume increases on up days, while new 52-week lows contract, this would be positive for the market.

The iShares Russell 2000 Index (IWM) Weekly Price Channel, Upside Objective Channel, and 19-26-9 Week MACD

The top portion of the chart shows the weekly iShares Russell 2000 Index ETF (IWM) which is made up of companies with a market capitalization of between $300 million and $2 billion. The IWM made a high of 150.68 on 10/09/17, breaking out above its upper channel.  A consolidation followed with the IWM confined in a tight trading range, but has since turned down.  Even so, IWM is holding above an important support area.

The good news is during the short-term decline, the IWM remains above the weekly uptrend (pink line) while the other major averages are holding their ground.

The lower portion of the chart is MACD, a technical indicator that measures momentum. MACD peaked in January 2017, confirming the price high. The MACD sell turned out to be premature. The IWM consolidated while MACD weakened but didn’t get oversold, and go below 0. In September MACD turned up, broke the down trend (black line) not confirming the October high, and is now starting to roll over, showing a sign of a loss of momentum.  It’s a little early to know if MACD will continue to decline or if MACD will turn up and have enough strength to make a new momentum high.

The Russell 2000 (IWM) support is at 143.00. Resistance is at the old highs at 150.68 with an upside objective of 162.00.

Summing Up:

With our models in the most favorable condition and favorable seasonality, I am looking for the short term decline in the IWM to reverse and at least challenge the old highs at 150.69 and potentially reach the upper channel at 162.00.  If the IWM were to close below the lows made on 08/18/17 at 134.12 (circled in orange), this would negate my bullish view.

Intermediate Uptrend Continues In Technology Despite Slowdown in Momentum

 

PowerShares QQQ ETF (Nasdaq 100 Index) Weekly Price and Trend Channels (Top), and MACD 12-26-9 (Bottom)

The top part of the chart shows the weekly Power Shares 100 (QQQ), an exchange-traded fund based on the Nasdaq 100 Index, and its operative trend channel (purple line).

The QQQ includes 100 of the largest domestic and international nonfinancial companies listed on the Nasdaq stock market based on market capitalization.  As of 11/7/17, Apple, (AAPL) is the largest holding comprising 12.47%, Microsoft Corp (MSFT) 8.96%, Amazon.com, Inc. (AMZN) 7.45%, Facebook, Inc. Class A (FB) 5.90%, Alphabet Inc. Class C (GOOG) 4.96%, and Alphabet Inc. Class A (GOOGL), 4.33 % totaling 44.07%.

The QQQ breached the middle channel after a 9-week consolidation (red circle) on 04/24/17 and continues to make new highs with only small pullbacks along the way.  The intermediate price trend remains up as long as the QQQ is above its uptrend line (orange).  Support is at 145.00 and the upside channel objective at 162.00.  If the QQQ falls below 145.00, on a weekly close, (an unlikely event), this would change the intermediate trend from up to down, implying weakness potentially to the lower channel at 116.00.

The bottom half of the chart is MACD (12, 26, 9), a measure of momentum. There has been no MACD confirmation of the highs made in QQQ as it did in June.  However, it is a positive sign MACD has turned up, after the negative divergence in MACD (green circles) and the uptrend is broken. I recommend keeping an eye on the top holdings in the QQQ over the next several weeks for an advanced warning of a trend change.

In Sum:

Technology continues to be in favor, outperforming the S&P 500.  As long as the QQQ is above 145.00 on a weekly close (orange line), more gains are likely toward the upper channel objective at 162.00.  Our models are positive and price uptrends are intact so there is a good reason to expect a year-end rally. Be aware of a short term decline to start if small caps remain weaker than the S&P 500, the top holdings in the QQQ begin to falter, and the uptrends are violated.  However, the trend is your friend.  Continue to enjoy the ride.

I would love to hear from you. Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.

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*******Article published by Bonnie Gortler in Systems and Forecasts November 9, 2017

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

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Happy Holidays to you and your family!  Thanksgiving is more than celebrating the holiday with family and friends, it’s a great time to reflect on all the things to be grateful for and show your gratitude to others. Being in a spirit of “thanksgiving” can be taken to a new level expressing daily your appreciation for all that you have been given. By adding the practice of daily thanks you will to experience just how wonderful life really is. With a conscious filled life of gratitude, you will not only show your gratitude but this daily practice will also give you the strength to find a way to get through the challenging times. Being thankful on a regular basis brings an abundance of confidence, love, and joy into your life. Gratitude is the start of happiness.

When you reach out to give thanks to others remember to give thanks to yourself as well. Your mental and physical health can benefit greatly from practicing appreciation on a daily basis because when you feel good it’s easier to lift up the spirits of others and be supportive of their needs. The love and patience you give yourself will create a compassionate and genuine loving heart that will be remembered as you continue to touch others in a spirit of appreciation.

Why not start today by telling someone “thank you” or by sharing a simple “I appreciate you” and see what happens. One kind word of encouragement you give can make a huge difference in someone’s life. You never know what others may be going through difficult times and how your kindness can impact the life of another. Today make the intention to sincerely reach out and help someone by giving words of hope or wisdom that provides them with a reason to believe and to keep their dreams alive. You will feel it through your entire body as your words and big-heartedness lifts their mood and spirit as you put a smile on their face, and all because you took the time to give of yourself.

Often, I reflect on my own wonderful wealth and well-being journey. It’s as if each step taken (even during those challenging periods) has brought me to where I am now. Stronger and more prepared than ever. I also have a certain level of peace that I didn’t know before because I now understand that with the ebb and flow of life those times of pain and struggle will pass. No one can avoid the bumps in the road, it’s part of life.

I have learned how important it is to maintain a positive mindset and stay focused with a good attitude and to the importance of practicing self-love. I’ve also learned how to better handle my own negative thoughts through years of personal development and by coaching others.  Saying “I can’t” was one of my favorite lines but I know through personal experience that this gets you nowhere, only more stressed, anxious and frustrated. Do you ever find yourself in this place?  I’ve learned to look for the solutions instead of zeroing in on the negative.  Handling situations in this way have proven so much better than being paralyzed with inaction. The more times I would say “NO”, the more I feared and I would procrastinate.  As a result, I would not do as much as I initially had set out to do. The solution is to do the best that you can do.  Take one simple action step at a time at a time and watch your self-confidence grow and do what you never imagined was possible.

If I can have you understand one thing it would be to fully realize the inspiration you are. Take the time to love yourself, love others, and be in a constant attitude of gratitude. Once you put daily gratitude into practice you will feel a sense of confidence that will bring about a happier you and will add more serenity and tranquility to your life.

11 Tips How To Shift To An Attitude of Gratitude For Your Happiness

  1. If you feel a bit overwhelmed, stop, don’t focus on what’s not working. Think of a positive thought that makes you feel better.
  2. Stop pressing and relax. The more you press, the longer something will take you to accomplish.
  3. If you are frustrated or irritated, don’t stay irritated for too long. Ask yourself, how can I simplify what I want to do? Think thoughts of kindness, have compassion for others and shift to an attitude of gratitude.
  4. Surround yourself with people who you trust and support you.
  5. Learn how to accept feedback instead of taking what is said personally. What you learn will inspire you to take an action and then you will be on your way to achieve your goal.
  6. Be compassionate, send your love, a smile or a hug to someone.
  7. Have a good laugh with a friend today; laughter is good for the soul.
  8. Keep a journal. Write down 10 things you are grateful for. Try it and see the positive shift you will feel.
  9. Take some YOU time. Schedule yourself on your calendar. Go for a walk, call a friend you haven’t spoken to, book a massage, buy yourself a present, or read a book.
  10. Watch your words you tell yourself. Focus your thoughts on what you want and not thoughts of what you don’t want. (A law of attraction principle).
  11. Go outside your comfort zone today. Do something that you have never done before, and achieve the goals you desire. I’m here to partner with you.

The way you feel each day affects your life. Why not let today be the day you feel more grateful and thankful for life. Choose at least one tip from above to put into practice now. Be the one to share your gifts and talents with others. You will not only improve your well-being, but you will make a big difference to someone else and also impact others. It’s a cycle that goes on and on, so Be The Inspiration! Practice more gratitude, thanksgiving, self-love and your generosity will be returned to you tenfold filled with abundance, joy, and happiness.

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Renewed talk of U.S. tax reform and the good start to earning seasons have pushed the Dow Jones Industrial Average to a new record high on October 24.  However, the Nasdaq, S&P 500, and Russell 2000 were unable to do the same. The market has been in a steady uptrend since late August.  As the rally continues higher, so does investor optimism.  Short term price uptrends and support levels remain intact for the major averages.

Our equity timing model will shift from hold to bullish on November 1. Also unfavorable seasonality is out and favorable seasonality is in.

What to expect now?  The bulls to remain in control:

  • The daily tape action suggests there are no signs of a market top.
  • Overseas markets are in uptrends supporting the U.S. Market.
  • Although the Nasdaq is no longer leading in relative strength compared to the S&P 500, the top holdings Apple (APPL), Microsoft (MSFT), Amazon (AMZN), Alphabet Inc. Class A (GOOGL), and Facebook all remain above support. These stocks have quickly rebounded after a pullback.
  • High Yield Bonds are at or near their highs.
  • Volatility remains low.
  • Market breadth indicators are positive. The advance/decline line has made new highs.
  • The Russell 2000 (IWM) has been in a very narrow range since the highs made on October 4, not giving up much ground while digesting its gains after breaking out of its weekly channel.

Higher Intermediate Term Upside Objectives Remain For the S&P 500 (SPY)

Figure: S&P 500 SPDR ETF Weekly Price Channel (SPY, top) and 12-26-9 MACD (bottom)

The chart above is the weekly SPDR S&P 500 (SPY) ETF that is comprised of 500 stocks of the largest companies in the U.S. When you invest in the S&P 500 (SPY), you will get a broad representation of the overall large-cap U.S. stock market.

As of 10/25/17 its top 5 holdings in the S&P 500 were Apple Inc. (AAPL) 3.67%, Microsoft Corporation (MSFT) 2.74%, Facebook (FB) 1.84%, Amazon (AMZN) 1.76%, and Johnson & Johnson (JNJ) 1.72% totaling   11.73%.  The top part of the chart is the SPDR S&P 500 (SPY) ETF and its active weekly (intermediate) trading channel. The SPY continues its slow and steady rise this year. The SPY remains clearly in an uptrend that began in February 2016 (green line).  Declines have been minor and brief. Until this trendline is broken, no serious threat of a major decline should occur.

The upside channel objective is 276.00 (orange line).  In the unlikely event the SPY falls below 245.00, the area where the SPY broke out of its range, this would turn the intermediate trend negative and imply potential weakness towards the middle channel at 210.00

The bottom half of the chart shows the Relative Strength Index, a measure of momentum developed by Welles Wilder. RSI is based on the ratio of upward price changes to downward price changes. RSI peaked at 76.04 confirmed the SPY price high.  RSI readings of 70 or higher show strength and are most times considered bullish, not a sign of a top. Generally, as long as RSI stays above 40, the trend is up.  The bullish uptrend in RSI from 1/16/16 remains intact.

On the other hand, RSI has lost some momentum.  It’s normal for momentum to weaken (red circle) after a large rally. Short-term weakness is perfectly normal after a large run-up in prices.  We should expect to see either a minor pullback or sideways consolidation before another rally attempt can occur.  If the SPY penetrates 258.00, just above the recent highs, the buyers will step in.

 In Sum

As long as the S&P 500 (SPY) uptrend remains in effect, SPY should work its way higher toward the upper weekly channel at 276.00.  If the downtrend is broken (green lines) on either price or RSI a warning sign would be given and caution would be recommended.  With our trading model likely to change from hold to the most bullish condition on November 1, and November and December historically a very favorable time for investment gains in equities, I recommend buying dips in the S&P 500 (SPY) as long as the SPY remains above 245.00.

I would love to hear from you. Please call me at 516-829-6444 or email at bgortler@signalert.com to share your thoughts or ask me any questions you might have.

Sign up for a FREE 3 issue trial of Click Here: The Systems & Forecasts Newsletter

*******Article published by Bonnie Gortler in Systems and Forecasts October  26, 2017

Disclaimer: Although the information is made with a sincere effort for accuracy, it is not guaranteed that the information provided is a statement of fact. Nor can we guarantee the results of following any of the recommendations made herein. Readers are encouraged to meet with their own advisors to consider the suitability of investments for their own particular situations and for determination of their own risk levels. Past performance does not guarantee any future results.

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When was the last time you celebrated a milestone that had real meaning to you? One you can look back upon with fond remembrance. If one doesn’t come to mind it may be time to ask why. Three highly treasured milestones that come to my mind is when I went to dinner with my mom after I made her a millionaire, bowling my first 300, and holding my first book “Journey to Wealth” in my hand. I still smile whenever I think of those moments. Sometimes the word milestone can be overwhelming but I’m here to tell you attaining them can be fun while you fully enjoy the process along the way.

Remember too they become much sweeter when you celebrate your milestone once it becomes a reality.

Now, what about you? Are you going through the motions of each day or are you living a joyous life, filled with happiness, fun, and inner peace? Living life to its fullest helps if you are passionate about what you do. When you make a commitment, are loyal, and find others who are the same to you that’s when good things happen. Achieving goals, whether short, intermediate or long-term gives a feeling of accomplishment, and confidence. I have discovered time and time again that some of my greatest challenges have served as great motivation and inspiration along the way. 

Recently, I celebrated my 35th anniversary working in my corporate job. This milestone is rare in our society today. How many people do you know have been at the same company for 35 years?  This milestone was only possible through commitment, discipline, and mutual loyalty by the company and myself. A lot of change has occurred from 35 years ago, many hurdles were overcome, good times together, and many memories shared. It was an honor  I embraced and will be very grateful for forever.  What an intense feeling of accomplishment knowing I achieved 35 years of making a difference in people’s lives while helping them build wealth. It was very important for me to express my appreciation to my the colleagues and bosses who have supported me through the years.

In an effort to express my gratitude I decided to write a poem. It took me several days to find the right words (and many drafts too). Years ago, I would not have had the courage to share my feelings in such a personal way and as a result, I didn’t write or do any public speaking. What I did do was allow fear to get in the way. What helped me to break out of my comfort zone was being part of Toastmasters (an international speaking group). The experience broke the ice and greatly helped me to get over some of my worst public speaking fears. The courage to push through those challenges despite my fear only came about after attending  meetings on a consistent basis and having the discipline to stick with it no matter how I felt inside. The support I received was phenomenal and it helped be a support to others too. The experience helped me to have fun reading the poem to my colleagues all the time using hand gestures, making good eye contact, and adding humor while sharing my heartfelt words of gratitude and appreciation. That would have never been possible in years past, and putting myself out there made me smile  when I could see the poem was well received. What can you do today to move beyond your comfort zone so you too can move past your most elusive milestone? 

One way to help you discover how is to take a moment and think about what goals would bring you closer to happiness. What would inspire you so much that you would be fully committed and put yourself even closer to celebrating your own milestone? Below I’ve shared some more insights that will place you in a better position for making your dreams a reality. 

3 Simple Sure Fire Practices For Your Happiness Embracing Your Milestone

Practice Gratitude –

 Keep a gratitude journal and list those things you are grateful for. Before you go to sleep think about what good things happened during the day that brought you joy.  Practice gratitude and see the difference how you will start to shift to feeling more positive and enjoying the little things in life.

. Read a book, prepare your favorite meal, or call a friend you haven’t made the time for. Pamper yourself, light some candles and relax. Listen to your favorite relaxing music. Get a pedicure, manicure or massage. Drink some of your favorite relaxing tea, or have a cup of hot lemon water. Whatever it is, make it a priority to do something that makes you happy, something that gives you joy, something that you love, every day. 

Be quiet and stay present in the moment. You are probably busy, on the run, and you have a large to accomplish list. It’s a challenge to be still and quiet.  Make the commitment every day that you will take 5 minutes to just be. (I’m going to join you on this commitment). Allow yourself to be quiet and still. Close your eyes, take a deep breath and let it out slowly. Listen to the sounds of your body and your surroundings.  Relax and let your mind, body, and spirit be present in the moment.  Don’t focus on any thoughts about the future or the past. If they come up tell them to go away.   Allow yourself to feel the moment and relax.  Being quiet and staying present for five minutes a day goes a long way to relieve stress, giving you a sense of peace, and re-energizing your mind and spirit.

What goals are you working on? Is there anything you have had on the back burner you desire but need to apply more discipline and consistency? The time is now, don’t wait, and enjoy the journey! Apply the above three simple practices. Remember to incorporate gratitude, do something you love every day to make you happy, and be silent as you stay present in the moment. Start by discovering what you love to do and you find yourself celebrating many more successes as you reach the milestones within your life. 

 

 

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