Market direction is one way – and Turbocharged by Janet Yellen and the US Federal Reserve. Amazing that the Fed can make stocks, bonds, and commodities all rally at the same time. The US dollar and volatility are getting destroyed.
I do not suggest standing in the way of this rally (by shorting) or putting new money to work – valuations are just too high.
During this downtime, I have been reviewing my investment plan, doing research, and putting together a list of stocks for my shopping list.
Based on some of this research, I will be announcing a major change to my Active Tactical Asset Rebalancing Rules in the near future. I want to increase my cash holding during market valuation extremes – and also increase the buy low, sell high transactions available to trade in any given Month.
More on this change soon – I also wanted to include some gratuitous Donald Trump humor in this post, since the markets are getting boring:
OK, lets see how the markets are doing?
The following chart is based on the Z Option Market Analysis Tool – which determines if a market is trending by assigning a trending score from -3 to +3. This helps us keep our trading with the trend.
| Symbol | Description | Short Term Trend | Medium Term Trend |
| $DJI | Dow Jones Industrial Average | 3 | 3 |
| SPX | S&P 500 INDEX | 3 | 3 |
| RUT | RUSSELL 2000 INDEX | 3 | 3 |
| NDX | NASDAQ-100 INDEX INDEX | 3 | 3 |
| VIX | CBOE MARKET VOLATILITY INDEX | -3 | -3 |
| /ZB[M6] | 30-Year U.S. Treasury Bond Futures,ETH | 3 | 3 |
| /ZN[M6] | 10-Year U.S. Treasury Note Futures,ETH | 3 | 3 |
| /GC[M6] | Gold Futures, ETH | 2 | 3 |
| /CL[K6] | Light Sweet Crude Oil Futures,ETH | 1 | 3 |
| /DX[M6] | US Dollar Index Futures | -3 | -3 |
| $DJT | Dow Jones Transportation Average | 3 | 3 |
| XLK | SELECT SECTOR SPDR TRUST TECHNOLOGY SELECT INDEX | 3 | 3 |
| XLI | SELECT SECTOR SPDR TRUST INDUSTRIAL SELECT INDEX | 3 | 3 |
| XLY | SELECT SECTOR SPDR TRUST CONSUMER DIS SELECT INDEX | 3 | 3 |
| XLB | SELECT SECTOR SPDR TRUST MATERIALS SELECT SEC INDEX | 3 | 3 |
| XLE | SELECT SECTOR SPDR TRUST ENERGY SELECT INDEX | 1 | 3 |
| XLP | SELECT SECTOR SPDR TRUST CONSUMER STAPLES INDEX | 3 | 3 |
| XLV | SELECT SECTOR SPDR TRUST HEALTH CARE SELECT INDEX | 3 | 2 |
| XLU | SELECT SECTOR SPDR TRUST UTILITIES SELECT INDEX | 3 | 3 |
| XLF | SELECT SECTOR SPDR TRUST FINANCIAL SELECT SECTOR FUND | 3 | 3 |
Any market showing a 3 or a -3 is trending strongly – and should be factored into any options strategy you are contemplating.
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