Smith Rocks – Central Oregon
Based on Bullish Percent Indicator data this past week was a good week for U.S. Equities. I would not classify it as excellent, but at least there were positive moves in all the major indexes and one sector (Materials) moved out of the oversold zone. There are still five sectors that are oversold so we are still operating within a weak stock market.
Index BPI
Every major index moved up this week and that includes the S&P 100 and 500 as both escaped the oversold zone. The NASDAQ 100 had 14 stocks move from bearish to bullish. We are entering a period in the calendar year that is generally good for stocks. Now we need to wait to see if this positive trend continues.
Sector BPI
There are still opportunities to purchase oversold sector ETFs if you have not already done so. Staples and Utilities are the “best buy” as both are hovering around the 13% to 14% bullish zone. That is low. Keep in mind that the Sector BPI Plus investing model is a contrary approach as we purchase sector ETFs when they are down and sell when they are up.
This week I will update both the Carson and Franklin so readers will see how these two Sector BPI portfolios are performing.
If you are managing a Sector BPI Plus portfolio you should be holding shares in Discretionary, Staples, Health, Materials, Communications, Utilities, and Real Estate.
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Explaining the Hypothesis of the Sector BPI Model
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Based on yesterday’s (10/19/2023) BPI data, Health moved out of the oversold zone and Materials moved back into the oversold zone. We now let VHT ride and if VAW is not part of the portfolio, use available case to pick up shares.
Lowell