Weekly Update

August 20, 2018

 

Welcome to the Bollinger Bands Letter Update for Monday August 20, 2018.

 

This is an addendum to the August letter which was published on Saturday.

 

I saw an interesting headline on MarketWatch.com this morning.

            "Ignore the drama at Tesla and focus on the stock’s price zones to make money"

Which was accompanied by the sub head:

            "Tesla’s stock can move in a wide range in a short time, enabling investors to trade around price zones"

 

I have no idea who the author is or what 'price zones' are, but that isn't important. The headlines provide cogent advice of the sort that more investors and traders should take to heart. The methods aren't important, there are many paths up the mountain, it is the idea of ignoring the noise, paying attention to price and making unemotional trading decisions that is important. I am put in mind of Enron, which declined by two-thirds before the first bit of bad news came out. Those who paid attention to price got the message, those who didn't were hurt.

 

It doesn't seem like anyone pays attention to Dow's Theory any more, but it is still a useful, economically-sensitive trend measure and, as I interpret it, it is in bull mode at present.

 

Our outlook for US stocks remains constructive.

 

There have been some changes in Ice Breaker's positions. Currently there are 10 open positions: DIA, 1, QQQ, 1, SPY, 2, IJR, 3, MDY, 3.

 

The Value Line Program is in the market, with the Value Line Geometric at 581.71, the Friday sell stop is 568.83.

 

There were no changes to the ETF portfolios last week.

 

The ETF Program portfolio holdings:

Style (21): IJT, 1, IWF, 8, IVW, 6.

Country (21): EWQ, 8, EWL, 2, EWA, 1.

Sector (27): XLK, 9, PSJ, 8, XLY, 7.

 

Our allocations are 60% US stocks, 10% international, 10% yield and 20% cash.

 

Aggressive accounts should be 70% 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:

https://www.bollingerbands.com/bb-letter/

 

Until next time, I wish you well.

 

John Bollinger, CFA, CMT

 

Copyright 2018 by Bollinger Capital Management, Inc.

 

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