December BPI data opened up with a strong equities market. When I first started publishing Bullish Percent Indicator data a few years ago the following information was not used to manage any portfolios. BPI data was only used to give readers an overview of the U.S. Equities market. That changed recently for two portfolios as the sector section (2nd screenshot) is now used to manage the Carson and Franklin portfolios. If this unique management model proves successful more portfolio will be added or converted to the BPI management model.
Every major index moved up and all are now bullish. Once more, pay close attention to the NYSE and NASDAQ as these two indexes are broad indicators as to what all parts of the equity market are doing. The five indexes listed left to right focus more on large-cap stocks whereas the NYSE and NASDAQ include small- and mid-cap stocks. Since neither the NYSE or NASDAQ are over-bought we note that the small- and mid-cap stocks are lagging somewhat in the current “bull” market.
Now we come to the sectors or BPI data used to manage the Carson and Franklin portfolios. Readers using this model set a Trailing Stop Loss Order (TSLO) for Energy back on 10/21/2022 and likely sold when the price of VDE dropped. VDE is approaching another buying opportunity.
If you are currently holding VCR, VDC, VFH, VHT, VIS, VAW, VGT, or VNQ, be sure to set a 3% TSLO for any ETF that is 70% bullish. For those sector ETFs that are 80% bullish or higher, set a 2% TSLO so as to protect capital. None are at the 90% level. If we witnessed this high level we would set a 1% TSLO.
On Monday I plan to report on any changes in the Carson. On Wednesday or Thursday I’ll report on the Franklin. As I recall, the Carson holds one or two sectors that are now over-bought. If this is the case, I’ll report on what TSLOs to set on Monday.
Any cash available from sales or just sitting around in the money market, invest in SCHP which is Schwab’s inflation protection ETF. The current yield is 7.0%