Sectors In Particular

I Hesitate To Say It, But Natural Gas Should Be Positive Next Week.

The probability charts for $UNG and $BOIL are decisive for a positive move for this coming week. Both ETFs have a bottoming William’s %R pattern, which is generally strong.

$BOIL has a strong indicator in a function I developed called Percentage Change for RSI (PCR). PCR calculates a daily percentage and then computes the relative strength (RSI) for all the changes. A high positive PCR number, which $BOIL had from Thursday’s and Friday’s closing numbers, was very high. Caution: $BOIL has been called a widow-maker of an ETF. Its wild gyrations have caught many investors with their pants down or on too tight. I have made money on $BOIL but have definitely lost more, expecting too much from it.

And $UNG has a strong PCR, too, just not as strong. The strongest indicator for $UNG is a stochastic cross-over function. This function tracks a slow and fast stochastic when both have been falling, and suddenly the faster one goes up to cross the slower one; a buy signal is generated. The probability value for the buy signal based on $UNG’s cross-over is very high.

Last thought on these two ETFs – next week, a major winter storm is forecasted for central and northeast U.S. Winter storms are always a catalyst for strong upward price movement in natural gas. We’ll see.

As for my last weekend’s call for the SP500 ($SPY and $IVV), I made some money, and I hope you did too.

Update on Monday, Jan 30′ 23, at 8:15 AM – this looks like a bad call with $BOIL down more than 10% and $UNG down more than 6%.

Markets Overall

Don’t Fear The Stock Market Reaper

Like the stock market, the average for all sectors in the 30-day period, has gotten more bullish. This week the average is 4.32, which is still in the bearish zone, up considerably from where the average has been for the past two months. So things should be looking up, and as Jeff Hirsch, The Almanac Trader, recently wrote about, November during Mid-Term Elections is the top month for NASDAQ stocks.

The sector with the highest score is Energy, with an average of 5.07; the top pick in this group is $GUSH. The U.S. Stock Market is the second strongest sector, with a 30-day score of 5.03. The Health Care sector is showing bullish numbers in the short term, 17 days out. In this group, $RXL has the most robust numbers.

The bottom three sectors are Technology at 3.67, Bonds at 3.47, and Emerging Markets at 3.25.

Markets Overall Sectors In Particular

Energy Top Pick For The Next 30 Days.

So the overall 30-day average has improved from last week’s 3.87. This week the models give us an average of 4.22, which is still bearish. The number needs to get above 4.5 to be bullish to provide a positive outlook.

For the second week in a row, the Financial sector, scoring 3.59, has the worst 30-day average score. The U.S. Stock Market has the second worst average score at 3.77.

The Energy sector moved back to the number one spot as the sector with the most bullish number. Energy’s 30-day average score is 5.12, up from 4.27. And Biotechnology which was number one last week, is down to second with a score of 4.59, down from 4.83. With a score of 4.59, it is bearly bullish.

So, like the past five weeks, the models remain primarily bearish.