As you may know, I have a portfolio of concentrated safe-dividend growing issues. I don’t have 50 or 100 stocks, but focus on some 22 issues at this time. By applying the same analysis, employing simple 50 and 200-day moving averages to each one, so as to determine whether they are either in a Bullish or Bearish state, as I did the foreign country ETFs and our own stock market indexes, they each tell a tale of sorts.
For instance, those which are well below their 50 and 200-day averages, and their averages have bowed over and commenced to downtrend are: ABC, AAPL, BLK, CMCSA, CNI, ECL, FDS, GILD, IBM and UNP. That’s 10 of them, what of the other 12?
Of the remaining 12 stocks, easily 5 of those are seemingly neither, they are sort of neutral, and b’twixt and b’tween. I would not say they are bearish, but it’s not possible to call them bullish either. These are: AMGN, CHD, CVS, TSCO and VFC. You might see and judge some of these differently. A certain degree of subjectivity does come into play.
Finally, though, there are perhaps these 7, that still show a lot of relative strength… enough that I view them as still being bullish. These are: COST, DG, HRL, NKE, ROL, ROST and TJX.
With the opinion that I am coming to formulate, on the basis of that which I saw around the world, and data coming in that suggests that the world economy is quite weak, and our own here in the U.S. is far from robust and possibly faltering, leads me to believe that we are going to go the way of the markets of the rest of the nations of the world, which, as one person did the math for me on 17 different foreign market ETFs found that they had already peaked and declined from their Spring and Summer tops from as little as 18.9% for EWJ, to as much as EWZ’s collapse of 53.4% already!
I can’t speak to this definitively, but I have a sense that within, perhaps about the next 2 weeks time; this rally is going to tell us of the true nature and state of our markets, as to whether we’re going to resume the near 7-year old Bull, or confirm that we have joined all the rest of the world in entering our own Bear Market. My current opinion has changed and I am now leaning to the idea that the Bear is emerging from its cave of hibernation, and after nearly 83 months will be hungry to feed on stock investors.
In the premarket, and as our index futures trade overseas, I see that as of 6:30 a.m. EST, they are off from .32 to .38%, and even though Asia is up, Europe is off by a similar amount at this time. Look for the breather, then the next lift in 3 to 7 business days, to give confirmation to this rally.
Here’s to your successful investing!
Harold F Crowell