S.T.A.Y.™ current position for Active portion of portfolio: CASH – S.T.A.Y. Plus™
When you are freeway driving, there is seldom a need to apply brakes, slowdown for turns, shifting gears for frequent change in grade, etc.. However, when you are driving on mountain roads just the opposite is the case.
We are currently in a “mountain road” market and therefore a need to be quicker to make changes until the road smoothes out. Therefore, we will be either in cash or investing in the market (long or inverse) based on our short-term signal. For those following our signals in their 401k or other outside accounts, we recommend sticking with the long-term signal (always noted on the first line of these weekly reports).
Since the high of July 27th, we have had two lower highs and two lower lows. So far that has established a short-term downtrend that has wiped out the market's gain of the last 2 ½ weeks while we've been waiting in cash. Based on our short-term signals, we took an inverse position in our portfolios last Friday. This position may be for a few days or a few weeks as we will be operating off of our shorter term indicators to make changes as needed. We will keep you posted.
Weekly Chart with Fibonacci Retracement Percentages (from the all-time high)
Monthly Chart with Fibonacci Retracement Percentages (from the all-time high)