J.J.'s Risky Business

Energy Select Sector SPDR Fund

Health Care Select Sector SPDR Fund

Materials Select Sector SPDR Fund

Consumer Staples Select Sector SPDR Fund

Technology Select Sector SPDR Fund

Industrial Select Sector SPDR Fund

Financial Select Sector SPDR Fund

Consumer Discretionary Select Sector SPDR Fund

IShares Core S&P Small-Cap ETF (IJR) Coppock Guide: Nonbullish as of May Day 2014

IShares Core S&P Small-Cap ETF

SPDR S&P MidCap 400 ETF

SPDR S&P MidCap 400 ETF (MDY) Coppock Guide: Nonbullish as of May Day 2014

SPDR S&P 500 ETF

SPDR S&P 500 ETF (SPY) Coppock Guide: Nonbullish as of May Day 2014

PowerShares QQQ

PowerShares QQQ (QQQ) Coppock Guide: Bullish as of May Day 2014

Figure 1: ETF Behavior After Coppock Guide’s Bullish Signals

photo 0041-Figure1-580-Correx_zpsc3f14f0e.png

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

Measured by their Coppock guide initial bullish signals since inception, XLU has been hot, while XLF has been not. In predicting future upward movements in share prices on monthly closing bases, the initial bullish signals for the former ETF have been absolutely perfect and the signals for the latter ETF have been absolutely imperfect.

Figure 2: ETF Behavior After Coppock Guide’s Nonbullish Signals

photo
0041-Figure2-580-Correx_zpsdda873e0.png

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

Again, it is extremely important to keep in mind that a nonbullish signal is not equivalent to a bearish signal in the context of the Coppock guide as I employ it. Nonetheless, the Coppock guide initial nonbullish signals for XLE, XLU and XLF collectively have compiled pretty interesting historical performance records since inception.

Because the Coppock guide is calculated on the basis of monthly data, I will be recrunching all the relevant numbers following the market close on Friday.

Correction: This recrunching of the relevant numbers allowed me to detect a data-download error associated with MDY, which in turn enabled changes in this article’s graphics and their related text: See SPDR S&P MidCap 400 ETF (MDY) Coppock Guide: Nonbullish as of May Day 2014.

Sector SPDRs Behavior In January Indicates Change In Mood, 2013 Vs. 2014

Author’s Note: This blog entry is being cross-posted at both J.J.’s Risky Business and J.J. McGrath’s Instablog on Seeking Alpha.

Disclaimer: The opinions expressed herein by the author do not constitute an investment recommendation, and they are unsuitable for employment in the making of investment decisions. The opinions expressed herein address only certain aspects of potential investment in any securities and cannot substitute for comprehensive investment analysis. The opinions expressed herein are based on an incomplete set of information, illustrative in nature, and limited in scope. In addition, the opinions expressed herein reflect the author’s best judgment as of the date of publication, and they are subject to change without notice.

Sunday, May 25, 2014

PowerShares QQQ (QQQ) Coppock Guide: Bullish as of May Day 2014

The PowerShares QQQ (QQQ) is the 13th and final exchange-traded fund featured in a J.J.’s Risky Business blog series centered on the Coppock guide this month. Aka either the Coppock curve or the Coppock indicator, the guide is a long-term indicator of price movements in major equity-market indexes calculated on the basis of monthly data.

During the first third of this year, QQQ’s adjusted closing share price dipped to $87.39 from $87.40, a drop of -1 cent, or -0.01 percent.

In the context of my work, the first 12 ETFs covered in my Coppock guide blog series and QQQ are different in a couple of important ways, as follows:

• First, the former funds are all derivatives of S&P 1500 subindexes, while the latter fund is a derivative of the Nasdaq-100 index.

• And, second, I monitor the first 12 funds through the multiple metrics constituting my Daily Market Seismometer, while I track QQQ via other metrics only periodically.

Nonetheless, I believe it is helpful to keep an eye (or two) on QQQ, especially when the equity market appears to be approaching an inflection point, as is the case now.

Figure 1: QQQ And Its Coppock Guide, The Complete History

Note: The QQQ closing-value scale is on the left, and the Coppock guide scale is on the right.

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data and those data themselves.

Edwin S. Coppock built his long-term guide not to flash both bullish and bearish signals but to generate only bullish signals. However, I employ it to produce either bullish or nonbullish signals. It is extremely important to keep in mind that a nonbullish signal is not equivalent to a bearish signal in the context of the guide.

I anticipate QQQ may rise after a bullish signal and expect it might do anything following a nonbullish signal (i.e., trade higher, lower or sideways).

Figure 2: QQQ’s Behavior Subsequent To Initial Bullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The QQQ Coppock guide’s initial bullish signals collectively have done a fair job in forecasting the future upward movements of the ETF on monthly closing bases. In 12 cases since February 2001, these signals have been successful on eight occasions, or 66.67 percent of the time, and unsuccessful on four occasions, or 33.33 percent of the time.

The latest initial bullish signal flashed last June, when QQQ’s closing share price was $70.38. Accounting for the one-month lag in the confirmation of any signal, the ETF’s closing share price advanced to $87.39 this April from $74.82 last July, which clearly constitutes bullish action by any standard.

Figure 3: QQQ’s Behavior Subsequent To Initial Nonbullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The QQQ Coppock guide’s initial nonbullish signals collectively have compiled an interesting track record since February 2001. Again, it is important to keep in mind a nonbullish signal is not equivalent to a bearish signal in the context of the guide. Following 12 initial nonbullish signals over the years, the ETF’s share price on monthly closing bases fell on seven occasions, or 58.33 percent of the time, and rose on five occasions, or 41.67 percent of the time.

Based on the deceleration in the momentum of QQQ’s share price this year, I suspect the Coppock guide may generate its next initial nonbullish signal by July 1.

Coppock Guide: The Blog Series

IShares Core S&P Small-Cap ETF (IJR) Coppock Guide: Nonbullish as of May Day 2014

SPDR S&P MidCap 400 ETF (MDY) Coppock Guide: Nonbullish as of May Day 2014

SPDR S&P 500 ETF (SPY) Coppock Guide: Nonbullish as of May Day 2014

Sector SPDRs Behavior In January Indicates Change In Mood, 2013 Vs. 2014

Author’s Note: This is the final blog post in a May series centered on the Coppock guides of 13 important ETFs, among them all nine Select Sector SPDRs and the three most popular funds based on the constituent indexes of the S&P 1500. The first installment of the series was cross-posted at both J.J.’s Risky Business and J.J. McGrath’s Instablog on Seeking Alpha, but the rest of it was posted here.

Friday, May 23, 2014

SPDR S&P 500 ETF (SPY) Coppock Guide: Nonbullish as of May Day 2014

The SPDR S&P 500 ETF (SPY) during the first four months of the year ranked first by return among the most popular exchange-traded funds based on the S&P 1500’s three constituent indexes, which also encompass the SPDR S&P MidCap 400 ETF (MDY) and the iShares Core S&P Small-Cap ETF (IJR).

Over the first third of 2014, SPY’s adjusted closing share price rose to $188.31 from $183.88, a gain of $4.43, or 2.41 percent. Meanwhile, MDY rose to $246.84 from $243.54, a gain of $3.30, or 1.36 percent, and IJR fell to $107.13 from $108.82, a loss of -$1.69, or -1.55 percent.

SPY is the 12th of 13 ETFs featured in a J.J.’s Risky Business blog series this month. Basically, I have been looking at each ETF with both eyes fixed on its Coppock guide, as was the case in “SPY Coppock Guide: Away From Bullishness, Toward Nonbullishness as of March 31, 2014.” The Coppock guide, aka either the Coppock curve or the Coppock indicator, is a long-term indicator of price movements in major stock-market indexes calculated on the basis of monthly data.

Figure 1: SPY And Its Coppock Guide, The Complete History

Note: The SPY closing-value scale is on the left, and the Coppock guide scale is on the right.

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data and those data themselves.

I anticipate SPY may rise after a bullish signal and expect it might do anything following a nonbullish signal (i.e., trade higher, lower or sideways).

Figure 2: SPY’s Behavior Subsequent To Initial Bullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The SPY Coppock guide’s initial bullish signals collectively have done an excellent job in forecasting the future upward movements of the ETF on monthly closing bases. In 22 cases since December 1994, these signals have been successful on 18 occasions, or 81.82 percent of the time, and unsuccessful on four occasions, or 18.18 percent of the time.

The latest initial bullish signal flashed in June 2012, when SPY’s closing share price was $131.18. Accounting for the one-month lag in the confirmation of any signal, the ETF’s closing share price soared to $177.40 in January 2014 from $132.74 in July 2012, which clearly constitutes bullish action by any standard.

Figure 3: SPY’s Behavior Subsequent To Initial Nonbullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

In contrast, the SPY Coppock guide’s initial nonbullish signals collectively have done nothing in predicting any movements of the ETF on monthly closing bases. In 21 cases since December 1994, SPY has followed these signals by advancing on 11 occasions, or 52.38 percent of the time, and declining on 10 occasions, or 47.62 percent of the time.

The most recent initial nonbullish signal was produced in February, when SPY’s closing share price was $185.47. Subsequently, the comparable figures were $187.01 in March and $188.31 in April. Therefore, the action in the market appears to have been pretty nonbullish to me, even though it is still an open question as to whether the ETF will fall or rise on a monthly closing basis in the wake of this signal.

Coppock Guide: The Blog Series

IShares Core S&P Small-Cap ETF (IJR) Coppock Guide: Nonbullish as of May Day 2014

SPDR S&P MidCap 400 ETF (MDY) Coppock Guide: Nonbullish as of May Day 2014

Sector SPDRs Behavior In January Indicates Change In Mood, 2013 Vs. 2014

Author’s Note: This is the 12th blog post in a May series centered on the Coppock guides of 13 important ETFs, among them all nine Select Sector SPDRs and the most popular funds based on the S&P 1500’s three constituent indexes. The first installment of the series was cross-posted at both J.J.’s Risky Business and J.J. McGrath’s Instablog on Seeking Alpha, but the rest of it is being posted here. You can follow me (and the series) @JJMcGrath3000 on Twitter, at JJMcGrath on StockTwits and via myself on Google+.

Wednesday, May 21, 2014

SPDR S&P MidCap 400 ETF (MDY) Coppock Guide: Nonbullish as of May Day 2014

The SPDR S&P MidCap 400 ETF (MDY) during the first four months of the year ranked second by return among the most popular exchange-traded funds based on the three constituent indexes of the S&P 1500, which also encompass the SPDR S&P 500 ETF (SPY) and the iShares Core S&P Small-Cap ETF (IJR).

Over the first third of 2014, MDY’s adjusted closing share price rose to $246.84 from $243.54, a gain of $3.30, or 1.36 percent. Meanwhile, SPY rose to $188.31 from $183.88, a gain of $4.43, or 2.41 percent, and IJR fell to $107.13 from $108.82, a loss of -$1.69, or -1.55 percent.

MDY is the 11th of 13 ETFs featured in a J.J.’s Risky Business blog series this month. Basically, I have been looking at each ETF with both eyes fixed on its Coppock guide, as was the case in “SPY Coppock Guide: Away From Bullishness, Toward Nonbullishness as of March 31, 2014.” The Coppock guide, aka either the Coppock curve or the Coppock indicator, is a long-term indicator of price movements in major stock-market indexes calculated on the basis of monthly data.

Figure 1: MDY And Its Coppock Guide, The Complete History

photo 0038-Figure1-Correx-580_zps21d81cd8.png

Note: The MDY closing-value scale is on the left, and the Coppock guide scale is on the right.

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data and those data themselves.

I anticipate MDY may rise after a bullish signal and expect it might do anything following a nonbullish signal (i.e., trade higher, lower or sideways).

Figure 2: MDY’s Behavior Subsequent To Initial Bullish Signals

photo
0038-Figure2-Correx-580_zpsecd73dea.png

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The MDY Coppock guide’s initial bullish signals collectively have been almost perfect in forecasting the future upward movements of the ETF on monthly closing bases. In 15 cases since July 1997, these signals have been correct on 14 occasions, or 93.33 percent of the time, and incorrect on one occasion, or 6.67 percent of the time.

The latest initial bullish signal flashed in January, sandwiched between initial nonbullish signals generated in December and February. Accounting for the one-month lag in the confirmation of any signal, MDY’s closing share price advanced to $250.57 in March from $249.71 in February, which constitutes bullish action.

Figure 3: MDY’s Behavior Subsequent To Initial Nonbullish Signals

photo
0038-Figure3-Correx-580_zpsfbd8e988.png

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The MDY Coppock guide’s initial nonbullish signals collectively have compiled an interesting track record since July 1997. As customary, it is important to keep in mind a nonbullish signal is not equivalent to a bearish signal in the context of the guide. Following 15 initial nonbullish signals over the years, the ETF’s share price on monthly closing bases fell on nine occasions, or 60.00 percent of the time, and rose on six occasions, or 40.00 percent of the time.

The most recent initial nonbullish signal was produced in February, when MDY’s closing share price was $249.71. Factoring in the one-month lag in the confirmation of any signal, the ETF’s closing share price declined to $246.84 in April from $250.57 in March, which constitutes nonbullish action.

Intriguingly, the change in market participants’ mood between last year and this year was indicated first not by the behaviors of either SPY, a proxy for large-capitalization equities, or IJR, a proxy for small-cap issues, but by the performance of MDY, a proxy for mid-cap stocks.

Correction: To fix a data-download error, this article’s graphics and their related text have been changed to reflect the incorporation into the underlying analyses information relevant to MDY between August 1995 and November 1998.

Coppock Guide: The Blog Series

IShares Core S&P Small-Cap ETF (IJR) Coppock Guide: Nonbullish as of May Day 2014

Sector SPDRs Behavior In January Indicates Change In Mood, 2013 Vs. 2014

Author’s Note: This is the 11th blog post in a May series centered on the Coppock guides of 13 important ETFs, among them all nine Select Sector SPDRs and the most popular funds based on the three constituent indexes of the S&P 1500. The first installment of the series was cross-posted at both J.J.’s Risky Business and J.J. McGrath’s Instablog on Seeking Alpha, but the rest of it is being posted here. You can follow me (and the series) @JJMcGrath3000 on Twitter, at JJMcGrath on StockTwits and via myself on Google+.

Monday, May 19, 2014

IShares Core S&P Small-Cap ETF (IJR) Coppock Guide: Nonbullish as of May Day 2014

The iShares Core S&P Small-Cap ETF (IJR) during the first four months of the year ranked third by return among the most popular exchange-traded funds based on the S&P 1500’s three constituent indexes, which also encompass the SPDR S&P MidCap 400 ETF (MDY) and the SPDR S&P 500 ETF (SPY).

Over the first third of 2014, IJR’s adjusted closing share price fell to $107.13 from $108.82, a loss of -$1.69, or -1.55 percent. In contrast, MDY rose to $246.84 from $243.54, a gain of $3.30, or 1.36 percent, and SPY rose to $188.31 from $183.88, a gain of $4.43, or 2.41 percent.

IJR is the 10th of 13 ETFs featured in a J.J.’s Risky Business blog series this month. Basically, I have been looking at each ETF with both eyes fixed on its Coppock guide, as was the case in “SPY Coppock Guide: Away From Bullishness, Toward Nonbullishness as of March 31, 2014.” The Coppock guide, aka either the Coppock curve or the Coppock indicator, is a long-term indicator of price movements in major stock-market indexes calculated on the basis of monthly data.

Figure 1: IJR And Its Coppock Guide, The Complete History

Note: The IJR closing-value scale is on the left, and the Coppock guide scale is on the right.

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data and those data themselves.

I anticipate IJR may rise after a bullish signal and expect it might do anything following a nonbullish signal (i.e., trade higher, lower or sideways).

Figure 2: IJR’s Behavior Subsequent To Initial Bullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The IJR Coppock guide’s initial bullish signals collectively have done an excellent job in forecasting the future upward movements of the ETF on monthly closing bases. In 11 cases since April 2002, these signals have been correct on nine occasions, or 81.82 percent of the time, and incorrect on two occasions, or 18.18 percent of the time.

The latest initial bullish signal flashed in July 2012, when IJR’s closing share price was $70.95. Accounting for the one-month lag in the confirmation of any signal, the ETF’s closing share price soared to $104.79 in January 2014 from $73.71 in August 2012, which clearly constitutes bullish action by any standard.

Figure 3: IJR’s Behavior Subsequent To Initial Nonbullish Signals

Source: This J.J.’s Risky Business chart is based on proprietary analyses of Yahoo Finance adjusted monthly share-price data.

The IJR Coppock guide’s initial nonbullish signals collectively have compiled an interesting track record since April 2002. Again, it is important to keep in mind a nonbullish signal is not equivalent to a bearish signal in the context of the guide. After 12 initial nonbullish signals over the years, the ETF’s share price on monthly closing bases fell on eight occasions, or 66.67 percent of the time, and rose on four occasions, or 33.33 percent of the time.

The most recent initial nonbullish signal was generated in February, when IJR’s closing share price was $109.41. Factoring in the one-month lag in the confirmation of any signal, the ETF’s closing share price dipped to $107.13 in April from $110.14 in March, which clearly constitutes nonbullish action by any standard.

Coppock Guide: The Blog Series

Sector SPDRs Behavior In January Indicates Change In Mood, 2013 Vs. 2014