It’s About Market Internals, Not The News
Asbury Research’s Stock Market Update & Asbury Investment Management Video is a free report that we use to keep in contact with existing clients, and those who have previously asked for information about either Asbury Research or Asbury Investment Management (AIM). Feel free to contact us anytime for further information about our services for professional and private investors.
Follow The Money
In our July 30th Stock Market Update & Asbury Investment Management Video, we said that during times like these — when the stock market seems to be completely disconnected from the economy — the best thing an investor can do is to follow the money. One way that Asbury Research follows the money is via our two tactical models: The Correction Protection Model (CPM) and the Asbury 6.
The table below displays the current reading of the Asbury 6, which uses six different metrics to determine the daily internal strength of the US stock market. The “A6” is currently on a Positive status and has been since July 2nd. The benchmark S&P 500 has risen by 243 points or 8% since then.
Four or more metrics in one direction, either Positive (green) or Negative (red), indicate a tactical bias. The dates in each cell indicate when each individual constituent of the A6 turned either positive (green) or negative (red). Through Friday, only one of the “A6” — Corporate Bond Spreads — is Negative. When all Asbury 6 are positive, market internals are the most conducive to adding risk to portfolios. Each negative reading adds an additional element of risk to participating in current or new investment ideas.
Also Watch Volatility
Another important metric we will be paying close attention to next week is market volatility according to the CBOE Volatility Index — better known as the VIX or the Fear Gauge. Our colleague Ken Tomko discusses the importance of the VIX in this week’s video, which is available below.
The rightmost green highlights in the chart below show that the VIX has been below its 21-day moving average since Jly 1st — and is where it is likely to begin next week. This indicates a monthly trend of decreasing volatility that has historically coincided with rising equity prices.
As long as the VIX remains below its 21-day MA, currently at 22.05, we will view market volatility as being conducive to more near term US stock market strength. A sustained rise above there, however, would indicate the market is becoming apprehensive and would warn of an emerging market decline.
Our latest video below shows how we have navigated these recent market conditions in real time.
Asbury Investment Management (AIM): Our Latest Video
Asbury Research Ideas, Expertly Managed
Here is our August 13th Video Review, which explains how we have recently utilized Asbury Research’s market analysis and investment ideas to professionally manage client portfolios.
AIM offers a unique approach to investment management that is data driven, dynamic, and solely based on the currenttechnical condition and quantitative risk/reward profile of the financial markets.
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This communication is for informational purposes only. It is not intended as investment advice, or as an offer or solicitation for the purchase or sale of any financial asset. No inferences may be made and no guarantees of profitability are being stated by Asbury Research LLC. The risk of loss trading in financial assets can be substantial. Therefore, you should carefully consider whether such trading is suitable for you in light of your financial condition.