$SPY After two straight sessions of
big rallies, stocks slowed their paces slightly Friday. However, that didn’t
stop bulls from finishing the week on an up note. Energy shares outperformed as
crude oil prices rebounded more than 5%, while retailers pulled back. The Major Markets Model remains Bearish for
three of the four majors along with an Oversold status across the board. Stocks were much oversold at the beginning of
the week. In spite of gains in the last three sessions of the week, they are
not overbought yet, suggesting more room to go on the upside. With that said,
although VIX has dropped significantly from 23.57 on Tuesday to 16.48 Friday, a
mid-teen VIX doesn’t suggest that volatility is gone. Expect more volatile
moves down the road.
Currently the only Buy is the
Russell 2000, which while also carrying an Oversold status has retained a
Bullish Opinion through the most recent down turn. However, this along with the current rally looks
to be setting the stage for a Santa Clause rally in
the next couple of weeks.
Both of our model
portfolios have performed well over the past several weeks. While not being totally immune from the
volatility which has been driven by fear over the direction of crude oil prices
and the staying power of the Russian Ruble, the swings have be tempered while
significantly less than the general market and both portfolios are at or close
to their yearly highs.
We will stay the course
for the remainder of the year and finalize the rebalancing of the models at the
conclusion of the trading year.
Have analysts become more pessimistic on media companies?
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