January 12, 2014 SIN Executive Summary
- The most important message this week was the improvement in breadth over and above what was reflected in the major index price action.
- Short Term indicators did pivot back higher which takes away one caution for now.
- Longer Trend remains strong and actually improving on most measures.
- No signs of breadth deterioration that usually accompany major topping patterns.
- A little more strength from defensive sectors this week, but may turn out to be new year rotation into last year’s weakness in Real Estate, Utilities and Health Care.
- AD Line showed more volatility this week, but not enough to cause any concern. Some even improved overall for the week.
- McClellan Indicators continue to be a great tell and sign the strength is still underneath this market.
- Real Estate made a near term breakout this week trying to forge a bottom.
- Health Care looks like it could be in the early innings when looking long term.
What We are Watching:
- Small caps continue to perform well and still have some tailwinds. I think they can remain out front near term. $IWM $IWO
- Growth is pulling away from value. $IWO $QQQ $IWP
- Sector concentration should lean toward Growth and Cyclical sectors with the addition of Health Care, which I believe is going through a game changing shift. $IAI $IYJ $XLK $FDN $SMH $ITA $IYT $IYF
- Health Care, while not really a cyclical sector, I believe is going through a game changing shift that will drive it in a growth phase for a long time to come. $IYH $IBB $IHE $IHI $PSCH
- Real Estate while still near the bottom of the RS Rankings is breaking out bases on some ETFs $IYR $MORT $ROOF $VNQ
Thanks for taking the time to review this report. I am looking for a visual reference point for this summary. Some type of RPM gauges would fit perfectly…let me think on it for a bit. If there are any other improvements I can make, I would love to hear them. Please email me at firstname.lastname@example.org and please include your Stocktwits or Twitter handle.
Good luck this week. It is there for the making!
G. Thomas Lackey Jr, CMT CFP®
Follow me on StockTwits and Twitter @gtlackey
(All market data above are derived from Stockcharts.com, Esignal, and Reuters Datalink)
The information set forth herein was obtained from sources which we believe to be reliable, but we do not guarantee its accuracy. Neither the information, nor any opinion expressed, constitutes a solicitation by us of the purchase or sale of any securities or commodities.
There is no guarantee that the views expressed in this communication will become reality.
Investing in the stock or bond markets involves risk and potential loss of principal. Investment strategies should be thoroughly vetted and discussed with a financial advisor prior to implementing.