A rough start to 2016. Here is the weekly performance of the largest U.S. ETFs:
Weekly performance for the largest U.S. exchange-traded funds:
o SPDR Gold Shares (GLD) +4.16%
o iShares 20+ Year Treasury Bond ETF (TLT) +2.31%
o Vanguard Total Bond Market (BND) +0.66%
o iShares iBoxx USD High Yield Corporate Bond ETF (HYG) -1.32%
o SPDR S&P 500 ETF (SPY) -5.86%
o iShares MSCI EAFE ETF (EFA) -6.45%
o PowerShares QQQ (QQQ) -7.02%
o iShares Russell 2000 ETF (IWM) -7.79%
o Vanguard FTSE Emerging Markets ETF (VWO) -8.28%
After such a difficult week, the question is “are we there yet”. After breaking below support (small dotted red line), the next area of support is at $185 in the “SPY” S&P 500 SPDRs. That area marks the August 2015 closing low and the September 2015 low. About 140 S&P 500 index or nearly -7% lower than where the S&P 500 Index closed last Friday. It looks like the market is not finished correcting just yet.
The hopeful news is that investor sentiment has turned extremely pessimistic. I’ll show the updated numbers in tomorrow’s Trade Signals. Extreme pessimism is generally short-term bullish for the markets. This suggest a bounce.
Further, our CMG Ned Davis Research Large Cap Momentum/Breadth Index remains in a sell. Overall, we remain in a cyclically challenging period for equities. Hedge exposure.
By Steve Blumenthal. See important disclosures.
The current opinions and forecasts expressed herein are solely those of Steve Blumenthal and are subject to change. They do not represent the opinions of CMG. CMGs trading strategies are quantitative and may hold a position that at any given time does not reflect Steve’s forecasts. Steve’s opinions and forecasts may not actually come to pass. Information on this site should not be used as a recommendation to buy or sell any investment product or strategy.
