The Fred Report - Sector Review March 2013Since the last sector review, the market and SPY have reached our objective of 156 for this rally. Economically sensitive indexes have improved, with the exception of XLB. We have made selective stock changes to position us more defensively. It continues to look as if the first half of 2013 may be stronger than the second, so we are a bit more cautious and some adjustments seem prudent. The Fred Report - Sector Review February 2013Since the last sector review, the market has continued the January rally. Most important, economically sensitive indexes have improved. We have made some changes to position us more aggressively, and it continues to look as if the first half of 2013 may be stronger than the second, so no real changes are needed in this report. We continue to believe that some fairly large sector rotation could occur in 2013, and so far this is occurring.The Fred Report - Sector Review January 2013Since the last sector review, the market completed the forecast fall correction. Prices tested near support areas and rebounded sharply. Most important, economically sensitive indexes have improved. These changes are designed to position us more aggressively, and it now looks as if the first half of 2013 may be stronger than the second. Last month we mentioned that some fairly large sector rotation could occur in 2013, and these changes may just be the start of our positioning.The Fred Report - Sector Review December 2012
Since the last sector review, the market embarked on the forecast fall correction. Prices tested near support areas and rebounded sharply, and there has been deterioration in most technical indicators. Last month we mentioned that some fairly large sector rotation could occur in 2013, and that we have a “hit list” of sectors. We will change some sector weightings, but realize this is aggressive and may be early – trade carefully.
The Fred Report - Sector Review November 2012
Since the last sector review, the market has embarked on the forecasted fall correction. Prices tested near support areas and are rebounding sharply, and there has been deterioration in most technical indicators. Sentiment remains intermediate-term positive. Weekly stochastics have come down, while dailies are oversold, in most instances. This indicator configuration often means a choppy correction, and this is what we expect from here on out – the “bobbing cork” alluded to in prior reports. We expect some fairly large sector rotation to occur in 2013, and have a “hit list” of sectors, but do not want to make definitive changes until 2013.
The Fred Report - Sector Review October 2012
Since the last sector review, the market advanced on QE3 news, and has retraced much of that advance. Prices are choppy, and there has been deterioration in most technical indicators. However, sentiment remains intermediate-term positive. In last month’s review we questioned whether a period of quick sector rotation had started. It now appears that this is not underway, but we do expect this to occur in 2013.
The Fred Report - Sector Review September 2012
Since the last sector review, the summer rally closed in our target area of 140 - 143. After a period of consolidation, the market “changed character” as noted in our September 4th report, and has rallied sharply while showing some sector rotation. If we are making a mistake in this report, it is to maintain current positioning and not to make changes. We looked at several changes but models do not quite support this – but will tell you the change we would have made is to equal weight XLP and overweight XLY. Aggressive traders take note!
The Fred Report - Sector Review August 2012
Since the last sector review, the summer rally has moved into our target area of 140 - 143. We expect this move to continue into the end of August, and it could trade higher than 143, but we continue to see signs the market is narrowing and advocate a touch more defense moving into the fall months, as well as the early part of 2013.
The Fred Report - Sector Review July 2012Since the last sector review, the stock market has started a slow summer rally. So far this is a textbook move, with the lowest closing low for several months before in May, and should July close higher than June that could be it for the upside.The Fred Report - Sector Review June 2012Since the last sector review, the markets corrected below our projected range of 134 -132 on SPY, but have moved quickly back above it, suggesting a false breakdown may have occurred. Our Investor’s Intelligence %Bears model has weakened, although individual readings are now in the 27 area on that indicator. More time is needed to move sentiment into a sell mode, and a summer rally would likely do this.The Fred Report - Sector Review May 2012
Since the last sector review, the markets have corrected, close to but not yet touching, our projected range of 134 -132 on SPY. Our Investor’s Intelligence %Bears model remains elevated, although individual readings are now in the 20 area on that indicator. More time is needed to move sentiment into a sell mode, and the forecast summer rally would likely do this.
The Fred Report - Sector Review April 2012
Since the last sector review, the markets have stalled at the low end of our target range of 140 – 143 on SPY. Anecdotal sentiment is quite bullish, but the actual numbers remain favorable - our Investor’s Intelligence %Bears model remains elevated, although individual readings are now in the 21 area on that indicator. More time is needed to move sentiment into a sell mode, and the forecast summer rally would likely do this.
The Fred Report - Sector Review March 2012
Since the last sector review, the markets have arrived at the low end of our target range of 140 – 143 on SPY. Anecdotal sentiment is quite bullish, but the actual numbers remain favorable - our Investor’s Intelligence %Bears model remains elevated. US Small Cap stocks have made all time highs. European concerns have receded, and our expectation that these will be resolved favorably is becoming consensus view. Indicators on European stock indexes and currencies have favorable patterns, but US markets continue to look more attractive from a technical point of view. Still, this is a good point to tighten up stops, sell underperforming holdings and review positions.
The Fred Report - Sector Review February 2012
Since the last sector review, the markets have traded through important resistance. Our Investor’s Intelligence %Bears model remains elevated, but put/call ratios have come down, at least on up days. The Inverse Head and Shoulders patterns we alluded to in the last Sector Review have resolved in upside behavior, and US Small Cap stocks have made all time highs. European concerns continue to roil the markets, but our expectation is these will be resolved favorably – Indicators on European stock indexes and currencies have favorable patterns.
The Fred Report - Sector Review January 2012
Sector Weight Notes: We lower Technology (IYW) to an equal weight. We raise Financials (XLF) to an equal weight. Health Care (XLV) moves to an overweight and Consumer Discretionary (XLY) lowered to an underweight.
The Fred Report - Sector Review December 2011
Since the last sector review, the markets have traded sideways. Sentiment indicators remain elevated, but individual readings have started to come down. We acknowledge headwinds: (1) we see NO further U.S. government stimulus until after the 2012 elections, (2) Eurozone problems, and (3) Debt issues in the US. However, the markets may have discounted these issues, which are widely acknowledged, and European fears have kept sentiment negative, a plus.
The Fred Report - Sector Review November 2011
Since the last sector review, the markets have rallied sharply. Sentiment indicators remain elevated, and we believe a strong yearend rally is underway. We acknowledge headwinds: (1) we see NO further government stimulus until after the 2012 elections, (2) Eurozone problems, and (3) Debt issues in the US. However, the correction we have seen seems to have discounted these issues, which are widely acknowledged, and European fears have kept sentiment negative, a plus.
The Fred Report - Sector Review October 2011
Since the last sector review, the markets have been down. Sentiment indicators have improved, and we believe a strong yearend rally has started. We acknowledge headwinds: (1) we see NO further government stimulus until after the 2012 elections, (2) Eurozone problems, and (3) Debt issues in the US. However, the correction we have seen seems to have discounted these issues, which are widely acknowledged.
The Fred Report - Sector Review September 2011
Intermediate-term, stocks are holding. There are many attractive intermediate charts in this report. Many market participants seem to be overlooking this potential strength.
The Fred Report - Sector Review August 2011
Sector Weight Notes: We RAISE IYW to an OVERWEIGHT. We LOWER XLF to an UNDERWEIGHT. We acknowledge risk in a new overweight at this juncture, but Tech earnings have come in, the stocks look good, and we are looking six months out.
