Guardian Checklist for Wednesday 6/21/06
Published Tuesday 6/20/06
by Mark S. Young , President of Equity Guardian Group, LLC.
Investment Management & Research
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Intermediate-term Outlook (weeks):
Seasonal Cycle: Negative.
Coppock Breadth Indicator: Negative. The CBI was down 0.1 to 221.2, 0.8 beneath the exponential.
Weekly MACD: Negative.
Bull/Bear Market Indicator: Bull.
Conclusion: We are still in a Cyclical Bull Market. The Seasonal Cycle negative and the Weekly MACD is Negative. This is a major warning. It's also probably early. They usually are.
Short/Intermediate-Term
NYSE Cumulative A/D Volume: Negative.
ITBM: Negative.
Summation: Negative.
KTT*: Negative.
CCI Daily: Neutral.
10-day ARMS: Buy.
MACD Daily: Negative.
21-day MA: Negative.
Senticator: BUY.
Conclusion: Shorts are favored, but we turn at any time.
Short-term
Stochastic Turn Spotter: Neutral.
VIX 30': Neutral. Overdue for a a Buy.
MACD 60': Negative.
Moving Averages: Negative (barely). Watch the 1240 area.
Conclusion: Longs are favored above 1240 and with a MACD or VIX 30' Buy.
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Last time, I said what do we do now? We wait. The market needed and needs a spark and it may get one soon. I figured that there weren't a whole lot more folks to sell, and Tuesdays action demonstrates it. We couldn't get a rally going, but there wasn't any real selling either.
So, the sentiment is super supportive of a huge rally, and now we're about to get into the end of quarter period, too. If money starts flowing back into the market, there are enough shorts that things could get exciting fast.
The VIX 30' is very flat and still overdue for a Buy so keep an eye on it. Also watch the hourly MACD. The Nasdaq is slowly turning indicators up one by one. That's probably the area to play for a rally.
The KTT traders got stopped out and now the stoch is negative, so they sit on their hands.
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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):
25% SPY at 127.70
and
25% QQQQ at 42.10
and
25% QQQQ at 41.55.
and
25% QQQQ at 39.17.
and
25% SPY (on margin) at 126.75
and
25% SPY (on margin) at 125.20
We're very long. We may add.
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[b]Mutual Fund Models Position Summary
[b]1) STAMP 50% Money Market.
25% Velocity
25% Titan
[b]2) Rydex Naz Trader 0% Money Market.
100% Velocity
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[b]1)*Real Money* Seasonal Trading Asset Management Program(All weightings are approximate)
25% Velocity.
25% Titan
50% Money Market.
We are fully long. We may add.
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.
[b]2) Rydex Naz Trading Model
Weekly Trend: Negative.
Rydex Ratios Trigger: Positive.
MACD Risk Reducer: Buy.
CCI Entry Improver: Neutral.
NDX Stochastic: Buy.
We are long a 100% position in Rydex Dynamic OTC (aka Velocity). We're way under water and not happy about it. The odds, however favor a rally, so we ought to get a decent exit.
QQQQ bought 100% long at 41.81. Doubled up at 41.50. Exit when the Naztrader does.
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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.
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See our Web site for more
www.EquityGuardianGroup.com
Mark Young
President
Equity Guardian Group, LLC.
859-393-3335
