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First month of 2018 is in the bag, and the SPX finishes the month with a 5.66 % return, that's good. One thing for sure, this market is finally showing some weakness. Will the dip buyers save the day like they always did in 2017 ? we'll find out eventually. Let's take a look a closer look.
The SPY is closed at 281.90 and still well above its 200 moving average. For me , this is enough to stay in the market, despite all the "noise" out there. Following this simple rules has been very rewarding to me.
Another great indicator to gauge the stock market health, is to check the percentage of stocks in the S&P 100, that are still above their 200 moving average. This indicator was introduced by John Carlucci a few years ago, and has been helpful.
For January, 84.31 % of the stocks in the S&P 100 are still above their 200 moving average, up from
78 % last month.
Unemployment number is schedule to come out Friday. Analyst don't see any changes to the current rate of 4.10 %. I will post an update this weekend.
Finally, the US Sector. For the month of January, technology (XLK) was the sector of choice for the month. XLK returned 6.57 % return for January, and remains the best sector again for February.
This is my update for February. I hope you find these helpful, if you have any questions are simply want to chat, do hesitate to send me an email.
Happy Trading !
I love reading Wall Street Banks "predictions" at the end of each year, it makes me laugh. For 2018, the banks came out with nice safe predictions for the S&P 500. lets take a close look
With the S&P 500 closing 2017 at 2673.71, we can easily calculate their predictions in %.
Based on the numbers above, Wall Street "Predicts" that we'll see the market goes as high as 12.2%, and as low as -0.81 %, giving us a median of about 5.66%..........
This is what makes me laugh. On one hand, none of the banks are predicting a major correction despite the market being in a bull market for more than 9 years. On the other hand , despite the Trump tax cut, low unemployment , I'm surprised their "predictions" aren't more aggressive. Instead, they play safe.
Here at Passivestor, we stay away from forecasts and predictions, unless we figure out how to build a time machine ? We rather react to market events using simple systematic rules , than predict what the market will do next. This method has been extremely successful for me for more than a decade now. Do not take Wall street predictions too seriously , statistically they are bound to be all wrong.