Leading Off… Is the next move higher underway?

 

Tim Reazor
Chief Investment Strategist
NorAm Asset Management

 

With the Dow and S&P bouncing off their respective 10-day simple moving averages and the markets being up for three straight days I’m inclined to say yes.  But wait there’s more…

Earnings season is just getting underway and could derail any potential move higher.   So how do you keep your sanity?  Wait for the signals that it’s the time to move back into growth stocks.  Here are the signals…

 

1.Have we cleared resistance are we making new highs?

2.Does the move higher coincide with higher institutional quality volume

3.Are leading stocks leading the charge – not laggards – if laggards or beaten down stocks lead us higher that would be a junk rally.  We need quality stocks to lead – such as Continental Resources or Diamondback Energy (we’re long both names)

4.Bonds have to stop moving higher  – it TLT is advancing the move most likely won’t last.  We only want to invest when all the signals are in our favor.

In the meantime hone your watch-list.  As soon as I get my signal I’ll be cautiously adding to our portfolio for clients.  If we do get our signal next week expect some chop and some disbelief.   Headlines sell news and markets don’t always react in the manner you think they would or should.

Remain nimble and without opinion – it’s the best way to spot the next opportunity.

Please keep an eye out in your email for my weekend update video.  The video is a great way for clients to know what we’re thinking here in the shop.  The update is also a great way for the busy investor to stay in tune with the market and catch up on signals missed during the week.

The markets are closed Friday so there will not be a newsletter published.  Again I will have a video ready for you on Saturday and I will be hosting my radio show on Saturday.

Here is a link to listen live to my show on Saturday – http://www.iheart.com/live/1190AM-4276/?autoplay=true

Here is the link to ensure that you are subscribed to the weekend update video –

http://noramassetmanagement.com/newsletter/   Please feel free to pass this along.

 

Best Regards,

Tim

 

The information presented is for educational and entertainment purposes only.  Opinions and information expressed are based upon information considered reliable.  However, factors are constantly changing and should not be relied upon. You need to do and verify your own research.  

Moreover, no reader or listener should assume that any information or discussion presented serves as personalized investment advice from NorAm Asset Management, Inc. or from any other investment professional, and is not an offer of solicitation for the sale or purchase of any specific securities, investments, or investment strategies. You need to have your own, individual investment advice suitable for your personal situation.

 

Investments involve risk and unless otherwise stated are not guaranteed.