Wednesday, September 2, 2015

Close to a buy signal, September 2nd close.

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All my timers -- short term, intermediate-term, and long-term, are in CASH.

The Dividend portfolio, which strives to remain invested, ignores the timers and is largely in cash because the holdings in the portfolio all were recommended to CASH.  If you don't know what this means you need to download the latest file from here and in general, become a member of my Dropbox.

To become a member, send an email to pduncan [ a t } v t {dot] e d u  (fixing the address, of course), and in the subject put "Dropbox" and I'll add you to TWO groups -- my Yahoo group, as well as the Dropbox group.  I need you in the Yahoo group because it's the only way I can communicate with the Dropbox users.



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The Long-Cash Ratio (LCR) table, which is described elsewhere in this blog, is showing signs of completing a base and starting to move higher.  On the left we have the 2d and 3d slopes of the LCR moving averages again with a positive slope, and on the right the acceleration of all of the moving averages is positive and moving higher.  This is a good set-up for launching back into stocks, BUT, we're not there yet.  The 5d slope needs to move positive (green), and this will take another day.

Hence, I am sitting pat on Thursday.  Cash is king.


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The cumulative tick chart, which I describe often (so read previous blog entries please), is showing constructive behavior.  The morning started poorly but around 12:15 p/ET the market starting to buy aggressively and steadily, which you can see in the reversal of the white trace.  With it closing above the moving averages of the cumulative tick, it is relatively strong (for the day) and if this continues, we'll get a buy signal soon.

Note though that the top trace, which shows the 52-week New Lows on the NYSE, is still dominating.  This is a RISKY market -- more stocks are making NEW LOWS than are making NEW HIGHS, and this is bass-ackwards.  To jump into the markets full force I would need this indicator to show new highs dominating, and we're simply not there.

Of course, we could see more gyrations like yesterday (Monday) and the market could head south again, zeroing the timers.  Your crystal ball is as good as mine.  I invest in the market I'm presented with, not the one I want.

I plan to keep my powder dry Thursday.

Strategy:

The Stock File at the Dropbox location above has been fully updated with lists of quality stocks and their recommendations, allocated per portfolio.  You will need to review the list of stocks in the Dropbox file in order to make any informed decisions.

I'm not buying on Thursday.

If the market is up Thursday we'll most likely get an entry signal for Friday.  The Dividend portfolio will be filled with quality stocks that have higher yields.  Most of you know I buy strength so these will only be bought if they take out the previous day's high plus 0.1%.

A buy signal right now will signal a 33% equity position in the markets, subject to further evaluation of portfolio signals/quality.  If this is foreign to you I simply use the stocks screened for a specific portfolio to determine whether I should enter the portfolio.  You'll see the process over the next few days if I get a buy signal.

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As always, you are responsible for your own investment decisions and I am not.  Please do your own diligence, and please take ownership for your actions.

Regards,

pgd