Research Excerpts

Tech-Related Asset Flows Key To June Market Direction

Posted on: Monday, May 23rd, 2016

The following is a brief excerpt from this morning’s Keys To this Week report for the US stock market.  Asbury Research subscribers also receive separate Keys To This Week reports for US market sectors, US interest rates, alternative investments/commodities/ETFs and the US Dollar.

Keys To This Week displays and discusses 10 key market factors that are most likely to influence the direction of the US stock market over the next several weeks to several months.

The report also includes the current signal of our Correction Protection Model, which protects investors against market declines and greatly reduces volatility of returns without sacrificing long term performance.

Key #2 of 10 of this week’s report, with the accompanying chart, appears below.


Keys To This Week: The US Stock Market
Monday May 23rd 2016: Key #2 of 10
Asset Flows: PowerShares QQQ ETF.
NEAR TERM BEARISH, MAJOR DECISION POINT.

Chart 2 below shows that the total net assets invested in QQQ declined below their the 21-day moving average on April 21st, indicating a trend of monthly contraction that is characteristic of US broad market declines.

Chart 2 of 6

Chart 2 of 6

However, the chart also shows that these assets are starting to stabilize from $35.3 to $32.8 billion, a level that has coincided with significant bottoms in the NASDAQ 100 (NDX) on February 10th and in August 2015 and October 2014.  A sustained rise above the 21-day moving average, from this key level, would suggest that another similarly-important bottom is in place.

continued in today’s report…


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