August 11, 2018
Welcome to the Bollinger Bands Letter Weekly Update for Saturday August 11, 2018.
The Russell 1000 version of the advance-decline line made a new high this week, see chart. In the absence of other evidence we take each new high in the advance-decline line as a sort of 'all clear' signal. We remain constructive on US stocks and are interested in the opportunities being created in the emerging markets.
Our FAANG index continues to consolidate after a correction. Confidence has been shaken and a recovery will take some time.
Smaller stocks, with an emphasis of growth, are our preferred avenue.
On the international front, the Shanghai Composite is trying to etch out a bottom. No indication of whether it will be successful yet.
The alt section of the crypto currency market, which is similar in many ways to the old over-the-counter markets for small stocks, is in the latter stages of a bear market and nearing capitulation levels. Shopping opportunities are being created for discerning buyers. Patience and research required. I'll take this up in the August newsletter next week.
If there is anything you'd like me to cover in this month's letter please let me know: firstname.lastname@example.org.
There are no changes to the ETF portfolios this week.
We recommend an initial position in emerging markets via Vanguard's ETF, VWO.
Our outlook for US stocks remains constructive.
The Value Line Program is in the market, with the Value Line Geometric at 580.87, the Friday sell stop is 568.83.
The ETF Program portfolio holdings:
Style (21): IJT, 1, IWF, 3, IVW, 2.
Country (21): EWQ, 11, EWL, 1, EWA, 5.
Sector (27): XLK, 6, PSJ, 5, XLY, 4.
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 Pack can be found here:
Until next time, I wish you well.
John Bollinger, CFA, CMT
Copyright 2018 by Bollinger Capital Management, Inc.