Weekly Wrap

Portfolio	S&P 500	Dow	Nasdaq
0.04%	1.99%	-2.80%	15.88%

 

 

When in doubt, Get Out!!!. The portfolio, aided by an interest payment on one of the GMAC bonds ended the week barely in the black after another horrid sell off in commodity related stocks. Meanwhile, the S&P 500 is barely in the black for the year and the Dow is barely in the red while the Nasdaq outpaces every other major index and is still up double digits for the year.

I am in doubt of the direction of the market so I sold the remaining stock positions and now in 100% cash as far as equities are concerned. Still holding the three bond positions.

The weekly chart of the S&P 500 shows that this was only the second down week since the March lows. More importantly, while we had continuous progress to the upsides for the first part of the move we have stalled for the past several weeks. This can be a consolidation pattern after the big move that resolves itself to the upside. However it is more likely that we have stalled here and that we will correct through time (side ways action) and price (lower price action) over the next several weeks. Fall is typically bullish for stocks. So if we manage to consolidate in time and price over the next couple of months, without too much damage, we should have a nice rally towards the end of the year.

Any any rate, I do not have much clarity and will wait to see what happens next week and try to pick new positions carefully.