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Here we periodically publish a chart and a brief excerpt from one of our premium research reports, a link or a video from one of our appearances in the financial media, or a notification that one of our price targets has been met, for the purpose of familiarizing potential subscriber with our investment research and to stay on the radar of those who have expressed an interest in us.

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Asbury Research’s Stock Market Update & Asbury Investment Management Video: December 14th, 2018

US Stock Market: On The Brink Of A Deeper Decline

In early October we alerted Asbury Research subscribers of weakening market internals, and started protecting Asbury Investment Management (AIM) portfolios against a bearish reversal in what appeared to be a weakening US stock market.

Less than a month later, the benchmark S&P 500 (SPX) had collapsed by 11% to 2604 by October 29th as shown in the chart below.  The index subsequently ripped higher into the 2815 November 7th high and, as shown by the blue highlights, has been trading within those two extremes ever since.

S&P 500: July 2018 through the present

There are 2 important takeaways here:

  1. The sideways trade of the past two months, as highlighted in blue, indicates investor indecision and, as such, is the probable starting point of the US broad market’s next directional move, and
  2. SPX has mostly been trading below its 200-day moving average, a widely-watched major trend proxy, which means the major trend is down (bearish).

Corroborating Takeaway #2 is the fact that 57 of the 60 global stock markets we track are also trading below their 200-day moving averages.

The red highlights on the chart show that, inside the past two months of of sideways trade, a smaller, triangular pattern exists, and that SPX is starting to trade below its lower boundary at 2655.  This suggests the market is currently leaning downward, toward even lower prices, which would be confirmed by a sustained decline below 2604.

A move below 2604 would indicate that the current major downtrend in SPX, which was initiated by the sharp October decline, is resuming.  Should this occur, we will be watching key chart levels below the market, along with our key internal market metrics, for opportunities to reestablish long positions at much lower, and better, levels.

The video below shows how we have navigated these choppy conditions for Asbury Research Management clients over the past several weeks.


Asbury Investment Management (AIM): Our Latest Video

Thank you for your interest in Asbury Investment Management. We attempt to provide the highest level risk management and investment performance available.  Anyone can provide you exposure to the markets. We bring our undivided attention, skill and experience to investing AND protecting our clients capital. We hope you will find these bi-weekly commentary and video reviews informative and helpful. Please don’t ever hesitate to ask if you would like to have a more in-depth conversation about our processes.

Click Here for our 12/13/2018 Video Review, which explains how we have used Asbury Research’s market analysis and investment ideas to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427-2879).

 


Asbury Research’s Stock Market Update & Asbury Investment Management Video: November 27th, 2018

US Stock Market: Price Trends, Market Internals Remain Weak

At the time of our previous November 8th Update, the benchmark S&P 500 (SPX) was in the midst of a corrective rebound following a sharp 11% decline between October 3rd and October 29th — a decline that we were fortunate enough to anticipate and, for the most part, avoid.

In that update we pointed out that the daily total net assets invested in the SPDR S&P 500 Trust ETF (SPY, which tracks the S&P 500) had just moved back above their 21-day (monthly, our tactical time frame) moving average to indicate an emerging trend of monthly expansion, similar to that which fueled the previous broad market rally from mid September to early October.

Editor’s Note: The total net assets invested in SPY are one of our “Asbury 6” key market internals.  We update the Asbury 6 every day and make them available to Asbury Research subscribers.

The chart below, an updated version of the one from our November 8th Update, shows that these assets have since declined back below their 21-day moving average as of November 19th, indicating a new trend of monthly contraction and a Negative reading.

The daily total net assets invested in SPY

In addition, the other five market metrics that comprise the Asbury 6 are also currently in negative territory, collectively indicating a risk off mode.

If and when these metrics move back to a positive (risk on) status, we will once again advocate a more aggressive stance in both our investment research (Asbury Research) and portfolio allocations (Asbury Investment Management).  Until then, however, we  remain in a defensive, capital preservation mode.


Asbury Investment Management (AIM): Our Latest Video

Click Here for our 11/27/2018 Video Review, which explains how we have used our latest research to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427-2879).


Nervous Bond Market Warns Of More Pain In US Stocks

In our October 22nd Research Excerpt, entitled The Put/Call Ratio: If The Market Can’t Rally Here, It’s In Trouble, we published one of the charts from our October Monthly Investment Compass (MIC, access requires subscription).

It showed that the CBOE Put/Call Ratio was hovering at a previous multi-year most bearish extreme, indicating a high ratio of put volume versus call volume,  that had closely coincided with every near term bottom in the S&P 500 this year.  We said:

“…unless the S&P 500 (SPX) recovers from major support near 2768 this week, the US broad market has probably changed it’s previous positive bias and is now in the early stages of a major bearish trend change — and headed significantly lower later on this quarter.”

Since then, SPX has declined by 101.00 points or 4%.

The graphic below displays Slide 16 of 30 from our latest, November 17th Monthly Investment Compass.  It shows that high yield corporate bond spreads have been in a trend of monthly widening since November 9th and — if you discount just two days of narrowing on November 7th and 8th — really since October 5th.

Slide 16 of 30: November 17th Monthly Investment Compass

The bond market is typically more forward-looking than the stock market. As a result, the S&P 500 has historically been unable to sustain rallies when corporate bond spreads are widening — which indicates that the bond market sees trouble ahead.  Moreover, the longer the spread remains in a trend of monthly (our tactical time period) widening, the more likely the US broad market is to slip into a sustained bearish trend.

 

Asbury Research subscribers can view our latest research on the US stock market, market sectors, US interest rates, ETFs and commodities, as well as a table with our current picks in US stocks, ETFs, and global indexes, by logging into the Research Center via the big gold button in the upper right corner of the screen.

To non-subscribers:  Request more information about us, including service and pricing options, by visiting our Contact Us page or by calling 888-960-0005.

For asset management, please visit the Asbury Investment Management (AIM) website.


Reviewing Our July 12th Educational Webinar: Where We Were & Where We’re Going

Monday, November 12th marked exactly 4 months since our July 12th 2018 webinar for Fidelity Investments, entitled Asbury Research’s 2018 Mid Year Investment Update.  In these webinars, which we have been regularly presenting to a number of investment firms and professional organizations since 2015, we show serious investors some of the tools that a veteran market strategist uses to improve investment performance while also protecting assets, and hopefully teach them how to be better informed and more successful investors.

The following market analysis is taken from the Executive Summary of our July 12th webinar for Fidelity (black text), followed by how the financial markets we discussed have fared since then (red highlights).


US Stock Market Outlook, July 12th: 

Despite recent geopolitical jitters,the US stock market is still in the midst of positive trends in most indexes, and amid mostly favorable technical/quantitative conditions for more strength. Specifically, we are expecting the  benchmark S&P 500 (SPX) to rise by as much as an additional 7%.

The S&P 500 proceeded to rise by an additional 6% into the 2941 September 21st high.

Market Size (where to be invested), July 12th:

Large Cap stocks remain amid favorable conditions for upcoming relative outperformance versus the S&P 1500.  Meanwhile, Small Cap is at opposite over-loved extremes and thus vulnerable to upcoming relative underperformance versus the S&P 1500.

Since July 12th, the iShares LargeCap S&P 500 ETF (IVV) has outperformed the iShares S&P 1500 Index Fund (ITOT) by 27% through October 24th.  Meanwhile, the iShares S&P SmallCap 600 Index underperformed the iShares S&P 1500 Index Fund (ITOT) by 21% also since October 24th.

Market Sectors (what to be invested in), July 12th:

We are currently overweight Utilities, Consumer Staples, Health Care and Real Estate, and are outright positive on Consumer Discretionary.

Since then:

  • The SPDR Utilities Sector ETF (XLU) outperformed the SPDR S&P 500 ETF (SPY) by 11% through October 24th
  • The SPDR Consumer Staples ETF (XLP) outperformed SPY by 11% through October 30th
  • The SPDR Health Care Sector ETF (XLV) outperformed SPY by 8% through November 12th
  • The SPDR Real Estate Sector ETF (XLRE) outperformed SPY by 3% through November 13th
  • The SPDR Consumer Discretionary ETF (XLY) rose by 7% through October 1st

No one can see into the future, and no one gets the markets right all the time.  We are certainly no exception.  But we do firmly believe that our comprehensive blend of technical, quantitative and behavioral market metrics — combined with almost 40 years of experience — can help to identify good investing opportunities in all market environments and, more importantly, can significantly limit losses and protect capital during adverse market moves.

Contact us to get more information about our research and services for professional and individual investors.

Asbury Research subscribers can view our latest research on the US stock market, market sectors, US interest rates, ETFs and commodities, as well as a table with our current picks in US stocks, ETFs, and global indexes, by logging into the Research Center via the big gold button in the upper right corner of the screen.

To non-subscribers:  Request more information about us, including service and pricing options, by visiting our Contact Us page or by calling 888-960-0005.

For asset management, please visit the Asbury Investment Management (AIM) website.


Asbury Research’s Stock Market Update & Asbury Investment Management Video: November 8th, 2018

US Stock Market: Recovering From An 11% October Correction

In our October 25th report, we said that our Asbury 6 key market internals — as well as our Correction Protection Model (CPM) — were all in Negative territory as of early October, indicating a “risk-off environment” and a market that was vulnerable to a corrective decline.  The benchmark S&P 500 (SPX) did indeed correct lower, by 11% between October 3rd and October 29th but, due to these timely signals from our metrics, we were able to 1) identify the danger for Asbury Research subscribers and 2) actually avoid most of the decline for Asbury Investment Management (AIM) clients.

As it stands right now, however, both CPM and our Asbury 6 are indicating the internal condition of the market has significantly improved.  One of our Asbury 6, ETF asset flows, is shown in the lower panel of the chart below.

SPX and SPY Total Net Assets

The rightmost green highlights show that the daily total net assets invested in the SPDR S&P 500 Trust ETF (SPY, which tracks the S&P 500) have moved back above their 21-day (monthly, our tactical time frame) moving average as of Wednesday, November 7th.  This indicates an emerging trend of monthly expansion, similar to that which fueled higher prices in the S&P 500 (upper panel) from mid September to early October, and also from early July to late August.

Expanding investor assets indicate investor conviction in higher prices.  As long as this emerging new trend of monthly expansion continues, the current broad market rally from  the late October lows is likely to continue.


Asbury Investment Management (AIM): Our Latest Video

Click Here for our 11/8/2018 Video Review, which explains how we have used our latest research to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427-2879).


Asbury Research’s Stock Market Update & Asbury Investment Management Video: October 25th 2018

Stock Market Breaking Major Support Amid Weak Internals

From our October 8th Keys To This Week report (access requires subscription):

“The benchmark S&P 500 (SPX) begins this week right on top of minor underlying support at 2873 to 2863 while 3 of our Asbury 6 market internals have moved into negative (bearish) territory.  Moreover, anther two of our Asbury 6 appear to be just another weak session or two away from also turning negative. 

This means SPX must recover from 2873 to 2863 immediately, on improving market internals, or will slip into a corrective phase and a potential test of major support at 2802 to 2763, which is an additional 3% to 4% below the market.”

A little more than 2 weeks later, the benchmark S&P 500 (SPX) has since collapsed by 234 points or 8.1.% and is now up just 1.2% for the year.

Is this the buying opportunity we’ve been waiting for, or just the beginning of a very bad 4th Quarter?

The good news is that SPX is currently testing underlying support at 2692, a level that we previously identified in our October 7th US Stock Market UpdateThese support levels are potential places for significant market bottoms to emerge. 

The bad news is that all of our Asbury 6 key market internals, per Table 1 one below, are in negative (bearish) territory.

Table 1

Our Asbury 6, which we update and make available daily in our research products, and are also a key component in our investment management decisions, measure the stock market’s internal strength in 6 different ways.

As long as all Asbury 6 remain in negative territory, it suggests a “risk off” environment where we focus on protecting investor assets rather than putting new money to work.


Asbury Investment Management (AIM): Our Latest Video

Click Here for our 10/24/2018 Video Review, which explains how we have used our latest research to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427 2879).


The Put/Call Ratio: If The Market Can’t Rally Here, It’s In Trouble

At the end of last week we published our October Monthly Investment Compass (MIC, access requires subscription), which is a collection of key charts, data, and intermarket analysis that convey our best investment ideas for US and global stock markets, US market sectors and industry groups, individual stocks, and US interest rates and related assets for the next one to several quarters.  It includes an accompanying video in which Chief Market Strategist John Kosar discusses each chart’s implications for upcoming US financial market direction. 

One of the 40 charts and data series we displayed and discussed in that report was the CBOE Put/Call Ratio, which provides information about the relative trading volumes of equity put options versus call options.

CBOE Put/Call Ratio since January

The rightmost green highlights in the chart below show that the CBOE Put/Call Ratio has for the past week been hovering at a previous multi-year most bearish extreme, indicating a high ratio of put volume versus call volume.  The other green highlights show that, as a contrary indicator, similar extremes have closely coincided with every near term bottom in the S&P 500 this year.

This means that, unless the S&P 500 (SPX) recovers from major support near 2768 this week, the US broad market has probably changed it’s previous positive bias and is now in the early stages of a major bearish trend change — and headed significantly lower later on this quarter.

 

Asbury Research subscribers can view our latest research on the US stock market, market sectors, US interest rates, ETFs and commodities, as well as a table with our current picks in US stocks, ETFs, and global indexes, by logging into the Research Center via the big gold button in the upper right corner of the screen.

To non-subscribers:  Request more information about us, including service and pricing options, by visiting our Contact Us page or by calling 888-960-0005.

For asset management, please visit the Asbury Investment Management (AIM) website.


Asbury Research’s Stock Market Update & Asbury Investment Management Video: October 12th , 2018

We are sending you this brief market update much sooner than our normal 2-week interval because we thought it might be timely and helpful considering this week’s violent collapse in the benchmark S&P 500 (SPX).  It includes a link to a video from Asbury Investment Management (AIM) which explains how we are utilizing Asbury Research investment ideas and strategies to professionally manage client portfolios during these volatile times. 

Click Here to request further information about our Research and Investment Management Services.

US Broad Market Testing 2016 Major Support

Asbury Research: US Stock Market Update, October 12th, 2018

In our previous October 7th Stock Market Update, we said:

“The chart below shows that last week’s pullback from the September 21st all-time highs has positioned SPX right on top of minor underlying support at 2873 to 2863If this support holds, it is likely to become the springboard for a rise to 3000 — our upside target for SPX since May.  If broken, however, it would clear the way for a deeper decline to the next key level at 2802 to 2763, which is major support.”

The 2873 to 2863 support area in the S&P 500 was broken early in the trading session on Wednesday, October 10th, and by the end of the session the broad market index had traded as low as 2772 to test the major support area we had identified.  Although we believed that a breakdown below SPX 2873-2963 would lead to a test of 2802-2763, I don’t think  anyone expected it to happen in one day.  We certainly didn’t.

The question now is, what next?

SPX 2802-2763 is major support, which means this is where the broad market index’s larger 2016 advance should resume — if still valid. Or, put another way, if the market can’t hold major support, it will slip into a major downtrend, which means an even deeper decline.

How can we tell if the major uptrend is still valid?

By studying market internals, which let us check the market’s health “under the hood”.  For that, we turn to what we call the Asbury 6, which are our six favorite market internals.  A chart of one of of the Asbury 6, ETF asset flows, appears below.  The pink highlights in the lower panel show that the total net assets invested in the SPDR S&P 500 ETF (SPY) collapsed by $13.9 billion or 4.9% just since October 3rd.  This is a big exodus from the SPYder in a very short period of time, and means all of the assets added since September 5th  — — during the S&P 500’s most recent advance to new all-time highs — have liquidated, most of them at a loss.  Until these assets begin to stabilize and then expand, this week’s sharp market decline is likely to continue.

S&P 500 and Total Net Assets Invested In SPY


Asbury Investment Management (AIM): Our Latest Video

Click Here for our 10/11/2018 Video Review, which explains how we have used our latest research to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427 2879).


Asbury Research’s Stock Market Update & Asbury Investment Management Video: October 7th , 2018

The following is a brief stock market overview from Asbury Research, and below it a link to a video from Asbury Investment Management (AIM) which explains how we are utilizing Asbury Research investment ideas and strategies to professionally manage client portfolios. 

Click Here to request further information about our Research and Investment Management Services.

US Market At A Key Inflection Point

Asbury Research: US Stock Market Update, October 7th, 2018

The benchmark S&P 500 (SPX) collapsed by more than 2.4% last week, high to low, but by the close on Friday lost just 0.97% for the week and is still up 7.9% for the year.  The sharp market decline was triggered by an equally sharp move higher in the yield of the 10-Year Treasury Note, above the critical 3.13% area which we have been alerting subscribers to since May — and most recently wrote about in an October 1st article for Forbes.  By anticipating the adverse stock market move this sharp rise in interest rates provoked, we were able to avoid much of last week’s decline in investment management clients’ portfolios.

The chart below shows that last week’s pullback from the September 21st all-time highs has positioned SPX right on top of minor underlying support at 2873 to 2863.  If this support holds, it is likely to become the springboard for a rise to 3000 — our upside target for SPX since May.  If broken, however, it would clear the way for a deeper decline to the next key level at 2802 to 2763, which is major support.   We will be closely tracking our key market internals over the next several days to anticipate what the market’s next move will be.

S&P 500 daily since January


Asbury Investment Management (AIM): Our Latest Video

Click Here for our 10/05/2018 Video Review, which explains how we have used our latest research to professionally manage client portfolios.

For further information about Asbury Research Management, please email or call 1-844-4-ASBURY (1-844-427 2879).


Positioning Portfolios For The 4th Quarter

Part of what our research does to help subscribers be properly positioned in the stock market is to fine-tune their core holdings, taking advantage of relative performance trends in the small, mid, and large cap segments of the market.  By modifying the core holdings within a portfolio to take advantage of these internal changes in relative performance, investors can potentially pick up some alpha in a more risk averse way — without changing the size of the core allocation.

Exactly 4 months ago, in our May 14th Keys To This Week report (access requires subscription) we pointed out an emerging breakout higher in the small cap Russell 2000 and said it targeted a rise to 1750.

Here is the chart from that report.

Russell 2000 daily: August 2017 to May 18th

The next chart, an updated version of the one above, shows that RUT traded as high as 1742 on an intraday basis on August 31st, essentially meeting our target,  and has since drifted lower.

Russell 2000 daily: August 2017 to September 14th

When a stock or an index gets this close to a price target and then stalls or reverses direction, we 1) assume that the directional implications of the breakout have been met and, as a result, 2) expect to see at least a minor decline as profit taking takes place.  Accordingly, this chart suggests this may not a particularly good time to to be adding exposure to the small cap space.

The next chart is a little more complicated, but simply shows that the Russell 2000 is also currently vulnerable to upcoming relative underperformance versus the overall market, between and year end.

Relative Performance of S&P 600 vs. S&P 1500 since 2015

It simply shows that the iShares S&P Small Cap 600 Index ETF (IJR,) is retracting from quarterly overbought extremes versus the the iShares S&P 1500 Index Fund ETF (ITOT), and that previous instances of this led every multi-month period of relative underperformance by Small Cap versus the overall market during this period (red vertical highlights).

This chart not only suggests that this is not a good time to chase the small cap space on an outright basis, but also that small cap is poised to underperform the overall market during the 4th Quarter. 

In a case like this, we are looking at similar charts and metrics to determine whether to shade core holdings in portfolios away from small cap, and toward either the mid cap or large cap space, as at least one of these three is always outperforming the overall market.  By selecting the right one(s) at the right time, and rotating them throughout the year as necessary, we can add some performance to portfolios without changing the actual size of the investment.

 

Asbury Research subscribers can view our latest research on the US stock market, market sectors, US interest rates, ETFs and commodities, as well as a table with our current picks in US stocks, ETFs, and global indexes, by logging into the Research Center via the big gold button in the upper right corner of the screen.

To non-subscribers:  Request more information about us, including service and pricing options, by visiting our Contact Us page or by calling 888-960-0005.

For asset management, please visit the Asbury Investment Management (AIM) website.

 

 


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