July 8, 2018
Welcome to the Bollinger Bands Letter Weekly Update for Sunday July 8, 2018.
The internal condition of the US stock market remains strong and we remain constructive on US stocks. The four advance-decline lines we track all made new highs last week and there are no important divergences of the sort we expect to see at market tops evident. We would like to see a further increase in new highs on the NYSE, but other than that there just isn't much to complain about. Our FAANG index is recovering nicely and near a new high.
Our GE trade is working nicely and we expect a lot more from it. Keep your focus on smaller stocks or large-cap growth coupled with relative strength. From a contrarian perspective we are starting to look at some of the emerging markets that have been marked down severely, for example Turkey.
We combined charts 24 and 25 in our Market Timing Chart pack into one relative performance international stock index chart.
There is one change to the ETF portfolios this week, sell EWH and buy EWA, which is a move from the Hong Kong to Australia.
There are no changes to the portfolios this week—it is not too late to do the GE trade.
The Value Line Program is in the market. With the Value Line Geometric at 580.88, the Friday sell stop is 568.35.
The ETF Program portfolio holdings:
Style (21): IJT, 1, IWF, 8, IWO, 6.
Country (21): EWQ, 6, EWU, 5, EWA, 1.
Sector (27): XLK, 11, PSJ, 4, XLY, 5.
Our allocations are 50% US stocks, 10% international, 10% gold, 10% yield and 20% cash.
Aggressive accounts should be 60% stocks, 10% cash.
Details on our Allocations, Ice Breaker positions and ETF portfolios along with our weekly Market Timing Chart Package can be found here:
Until next time, I wish you well.
John Bollinger, CFA, CMT
Copyright 2018 by Bollinger Capital Management, Inc.