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David Moenning is a the Chief Investment Officer at Heritage Capital Management. Dave is also the proprietor of StateoftheMarkets.com, which provides free and subscription-based portfolio services. Dave began his investment career in 1980 and has been an independent money manager since 1987.... More
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  • A Better Plan For The Next Big, Bad Bear

    Daily State of the Markets
    Wednesday, April 9, 2014

    With the blood-letting taking a break yesterday, we thought today would be a good time to continue exploring a simple, yet effective, trend-following system designed to keep investors on the right side of the market's really big, really important moves.

    But first there are the caveats. Please keep in mind that the results shown in this report are purely hypothetical. The numbers do not represent actual trading and do not take into account commissions, taxes, slippage, interest on money market etc. And we should also note that we do not utilize this specific approach at our shop as there are definitely pitfalls to using a single indicator.

    To review, we start with a monthly chart of the S&P 500. We then add in a 16-month, weighted moving average to a monthly chart. Next, we move the moving average forward 5 months. You can think of this as sliding the moving average to the right a bit to help avoid whipsaws. The moving average is the blue line on the chart below.

    S&P 500 Monthly from 1995

    To review, the plan is to be long the S&P when price is above the moving average and to be in cash when price is below the moving average.

    The results of such an approach are more than 77 percent better than that of the buy-and-hold of the S&P itself (+546 percent vs. +308 percent) and are also a bit better than our original goal of capturing 70 percent of bull market gains and avoiding 50 percent of bear market losses (which would have produced a cumulative gain +425 percent). So, all in all, the base-level approach isn't too shabby.

    But We Can Do Better, Right?

    While this was not the case even 10 years ago, today, investors know that they can play both sides of market trends. These days, creating a synthetic short is easily accomplished by purchasing an inverse ETF such as ProShares Short S&P 500 ETF (NYSE: SH).

    So, the next step in the system development process is to try to play both sides of the big moves by being long the S&P when the index is above the 16-month weighted moving average (moved forward 5 months) and to be short the S&P when the index is below the moving average.

    Frankly, this is an uber-simplistic approach and flies in the face of our belief that one should not use the same indicator to produce long and short signals. But again, our goal here is to K.I.S.S. (keep it super simple) and to provide an actionable idea that investors could use and/or build on.

    So, let's get to the numbers...

    If you are like me, your eyes likely immediately go to the cumulative results. So, the bottom line is using a long/short approach does indeed improve the overall returns over the long/cash strategy (+674 percent vs. +546 percent).

    However, due to the fact that stocks go down something like 3 times as fast as they go up, the long/short approach creates a significantly bumpier ride.

    While the returns during bear markets improve dramatically (see 2000-02 and 2008), using a long/short approach would have proved VERY hard to live with during 2009, 2011 and 2012.

    In my experience, investors are "long-term" as "long" as they are making money. So, given that the long/short approach was a bit of a train-wreck in both 2009 and 2011 (and then underperformed again in 2012), it is a safe bet that a great many investors would have given up on the system by the time 2013 rolled around.

    Based on this knowledge, we decided to take a slightly different tack.

    Let's Add Some Leverage

    Using the assumptions that (a) most investors would have given up on the long/short system in 2009-2012, (b) it was the losses on the short positions that caused all the trouble, (c) it is a bad idea to assume the same signal can work equally well for both the long and short side, and (d) we wanted to keep this approach VERY simple, we made the decision to kill the short signals and instead utilize some leverage.

    Like the idea of creating a short position via an inverse ETF, the concept of easily and cheaply adding leverage to a position didn't exist 10 years ago. Sure there were margin accounts, options or futures available, but each brings new complications to the game.

    But my how times have changed!

    There are now any number of ETFs and Mutual Funds that are designed to deliver 2X or even 3X the daily return of the S&P 500, the NASDAQ, the Russell 2000 and the Midcaps. Therefore, adding some "leverage" to a strategy is a snap in today's market.

    Introducing The Leverage Trigger

    However, blindly being 2X or 3X long the stock market at all times can be, well, dangerous. Trust me, you do NOT want to be holding a 2X long ETF or Mutual Fund when the S&P experiences a 10 - 15 percent correction. The bottom line is your account value can get ugly, very fast when things go against you for a protracted period.

    Because of this, we wanted to create a signal or a "trigger" to tell us when to be leveraged long and when not to be.

    Enter the "leverage trigger." Here's how it works. Take a look at the chart below. The purple dashed line is a 5-month weighted moving average, moved forward 2 months. In short, this line will act as our leverage trigger. When the S&P is above the purple line, you can hold a leveraged long position. And when the index moves below the purple dashed line (but remains above the solid blue line), the plan is to reduce leverage and simply hold the S&P 500.

    S&P 500 Monthly from 1995

    The idea is pretty straightforward. When the S&P 500 is above the leverage trigger and the leverage trigger itself is rising, it means the odds favor the bulls. So, experience tells us to go ahead and put the pedal to the metal and use some leverage.

    But when the S&P 500 moves below the leverage trigger, it means that a short- to intermediate-term correction may be taking place. And while, our long-term, big-picture strategy isn't designed to try and dodge such events, it is definitely a good idea to take less risk during this type of environment.

    The Levered Strategy

    Here are the rules we employed for our hypothetical back-test. When the S&P 500 was above the blue line, we held the S&P 500. When the S&P 500 was above the purple dashed line (aka the leverage trigger), we held a 2X long position. When the S&P 500 moved below the leverage trigger, we moved from a 2X long position to a 1X long position. And when the S&P 500 moved below the blue line, we moved to cash. (And for the record, when the S&P 500 is below the blue line, but above the purple line, no action was taken.)

    Here are the results of the hypothetical backtest.

    Okay, NOW we're talking: +2,008 percent vs. +308 percent - nice.

    Since we are using a leveraged strategy, those extended bull markets create very impressive results. And since the system is designed to largely get out of the way of big, bad bear markets, losses were also limited during periods like 2000-2002 and 2008. Not bad.

    But, There Are Some Drawbacks to Be Aware Of

    However... there are drawbacks to this system (as there are with any and ALL systems). First and foremost, the way the leverage trigger functions, investors are forced to add leverage when the market is moving higher and to cut leverage when the market is moving down. (Again, we wanted a simple, trend-oriented system.) As such, the inherent drawbacks to trend-following (i.e. whipsaws) still apply as buying high and selling low is still not fun - but it DOES happen.

    So, years like 2000, 2005, 2009, 2011 and 2012 were no picnics. However, since the only REALLY bad year in terms of absolute return was 2000, my guess is that this is a system that investors could probably live with for the long-term.

    Is this perfect? Uh no. But we were tasked with coming up with something that was (a) easy to use and (b) didn't require any fancy models or difficult math. So, on that score, I think we did okay.

    In Sum...

    In summary, the very simple monthly trend-following system we've reviewed does a decent job of getting the really big, really important moves right. However, as is the case with ANY system, there are "issues" to deal with along the way.

    So, given that the really trick to this game is to be able to stick with your strategy for the long-term, it is important to fully understand the pluses and minuses of a given approach. In addition, it is HIGHLY recommended that investors utilize multiple strategies in their overall portfolio. This limits the potential damage to one's account value during those inevitable times when an approach falls out of favor (and remember, they ALL do from time to time).

    However, it is our sincere hope that the explanation of our simple, monthly trend-following system can spur some ideas for your overall investing strategy.

    Looking for a disciplined approach to managing stock market risk on a daily basis? Check Out My "Daily Decision" System. Forget the fast money and the latest, greatest option trade. What investors need is a strategy to keep them "in" the stock market during bull markets and on the sidelines (or short) during bear markets.

    Turning to This Morning...

    The yen went the wrong way for Japanese stock market investors overnight but stocks in China continued to rebound on growing hopes for new monetary stimulus. Across the pond, stocks are rallying modestly but concerns about Ukraine appear to be keeping gains in check. Here at home, the minutes from the latest FOMC meeting will be released at 2:00 pm eastern. Traders (and their computers) will be looking for any new clues as to when the Fed will begin hiking interest rates. U.S. stock futures are pointing to a slightly higher open at this time.

    Pre-Game Indicators

    Here are the Pre-Market indicators we review each morning before the opening bell...

    Major Foreign Markets:
    - Japan: -2.10%
    - Hong Kong: +1.09%
    - Shanghai: +0.32%
    - London: +0.79%
    - Germany: +0.17%
    - France: +0.41%
    - Italy: +0.67%
    - Spain: +0.34%

    Crude Oil Futures: +$0.26 to $102.82

    Gold: -$5.00 at $1303.90

    Dollar: lower against the yen, higher vs. euro and pound

    10-Year Bond Yield: Currently trading at 2.699%

    Stock Futures Ahead of Open in U.S. (relative to fair value):
    - S&P 500: +1.99
    - Dow Jones Industrial Average: +33
    - NASDAQ Composite: +7.98

    Thought For The Day...

    Let him that would move the world first move himself. -Socrates

    Positions in stocks mentioned: none

    Follow Me on Twitter: @StateDave


    The opinions and forecasts expressed herein are those of Mr. David Moenning and may not actually come to pass. Mr. Moenning's opinions and viewpoints regarding the future of the markets should not be construed as recommendations. The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of StateoftheMarkets.com and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. One should always consult an investment professional before making any investment.

    Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.

    The analysis provided is based on both technical and fundamental research and is provided "as is" without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

    The information contained in this report is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also President and majority shareholder of Heritage Capital Management, Inc. (HCM) a Chicago-based money management firm. HCM is registered as an investment adviser. HCM also serves as a sub-advisor to other investment advisory firms. Ridge is a publisher and has not registered as an investment adviser. Neither HCM nor Ridge is registered as a broker-dealer.

    Employees and affiliates of HCM and Ridge may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Editors will indicate whether they or HCM has a position in stocks or other securities mentioned in any publication. The disclosures will be accurate as of the time of publication and may change thereafter without notice.

    Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.

    Apr 09 8:04 AM | Link | Comment!
  • A Plan For The Next Big, Bad Bear

    Daily State of the Markets
    Tuesday, April 8, 2014

    Stocks were hammered again on Monday as the momentum names continue to be punished. The question of the day, of course, is if the huge declines seen recently in names like Amazon.com, Tesla, Twitter, and Yelp will cause the "meaningful correction" in the broad market indices that just about everybody on the planet is looking for.

    Frankly, I don't know the answer to this question. I can say that there doesn't appear to be a fundamental driver for the current shellacking, other than some high flying stocks coming back down to earth, that is. My personal view is that either this decline, which for the record, finished its second day on Monday, becomes a self-fulfilling prophecy and people decided to panic out of stocks, or... this ends pretty quickly. But, the bottom line is that this is merely one man's opinion.

    We could spend the rest of our pixels this morning making predictions about what is likely to happen next. But, since we prefer to play the hand that has been dealt instead of guessing what might come next, I thought it might be a good time to make good on my promise to offer up an idea or two on how to get the really big moves in the market right (and no, a decline of 2.5 percent does NOT qualify as such).

    Getting the BIG Moves Right

    Late last week, we discussed the importance of getting the really big, really important moves in the stock market right. We looked at the past 20 years and found that investors would have made a pretty penny staying invested in the stock market. In fact, from 6/1/1994 through the beginning of April, a buy-and-hope investor in the S&P 500 cash index would have made +325.14 percent.

    We went on to note that although a gain of +325 percent is nothing to sneeze at, one COULD actually do much better if they managed to capture 70 percent of the bull market gains and avoided one-half of the bear market losses. We did some math and found that while such an approach missed a fair amount of upside and got hit with some of the downside, the +325 percent gain could hypothetically be improved to +450.5 percent.

    Graphically, such an approach is kinda/sorta illustrated in the chart below as the first rectangle drawn on the monthly chart of the S&P 500 covers about 70 percent of the bull market gain. In essence, the game plan it to grab "the meat" out of the major uptrends.

    S&P 500 Monthly from 1994

    Of course, one of the caveats we have discussed is that achieving such a result is easier said than done, as it is very tricky to (a) get the turning points correct and (b) avoid getting faked out when a substantial correction occurs.

    So, we had promised to provide an idea or two that could help investors get the really big, really important moves right.

    A Simple Monthly Trend-Following System

    Before we launch into the approach, we should state that what we are about to present is a very simple system and that all results presented are purely hypothetical. The numbers in this report do not represent actual trading and do not take into account commissions, taxes, slippage, interest on money market etc. We should also note that we do not utilize this specific approach at our shop as there are definitely pitfalls to using any single indicator.

    However, if all an investor wants to do is stay on the right side of the really big moves, this simple monthly trend-following approach does the job, for the most part. And the good news is the investor would only need to look at the market on the last day of each month.

    The idea is to apply a 16-month, weighted, moving average to a monthly chart of the S&P 500. Then we move the moving average forward 5 months. You can think of this as sliding the moving average to the right a bit. The moving average is the blue line on the chart below.

    S&P 500 Monthly from 1995

    In case you are not familiar with the concept, moving the MA forward helps avoid whipsaws, such as the 1998 emerging markets crisis that wound up spanning just a couple of months.

    The Strategy

    The idea is simple. If at the end of each month, the S&P 500 is above the 16-month, weighted, moving average that has been moved forward 5 months, you remain invested in the S&P. And if the S&P is below the MA, you stay in cash. Easy, right?

    Below is a chart showing the hypothetical monthly results of using such a strategy from 1995 through 3/31/2014. Again, this is a backtest of the strategy and should be used for "proof of concept" only.

    As you can see, the simple monthly trend-following system does indeed improve results over the buy-and-hope approach: +546 percent vs. +308 percent.

    The cumulative return is also little better than our original goal of capturing 70 percent of the upside and missing half of the downside, which produced a hypothetical gain of +425 percent over a similar period.

    In reviewing the annual returns of the hypothetical backtest, you can see that the system wound up losing money in 2000 but then stayed in cash during the remainder of the 2000-02 bear market. As such, the system lost -10.5 percent during the bear market, which is a big improvement over the market's decline of more than -40 percent.

    Then in 2008, the system lost just -1.44 percent versus the -38.5% decline seen in the S&P 500. Thus, it is clear that such a system did a nice job in preserving capital in the two brutal bears that occurred since the turn of the century.

    What's the Catch?

    However, the trade-off to the approach is quite evident in 2003 and 2009. In order to avoid getting whipsawed during the big, bad bear markets, such an approach is always going to be a bit late in getting you back into market after the bear has ended. Therefore, underperformance during the year following a bear market is to be expected.

    Then the other problem with such a system is a year like 2011, where the market first moved down violently and then moved right back up in an equally violent fashion over a very short period of time. Thus, the quick whipsaw created a fairly substantial loss on the year.

    But again, all in all, the system does a pretty good job of accomplishing our base-level goal.

    But Can't We Do Better?

    Everyone who has ever tested a system for managing the stock market knows that once you find something that works, the next step is to see if you can improve on the concept.

    So, tomorrow, we'll take a look at taking this simple, monthly trend-following system up a notch or two by (1) incorporating short positions into the mix and then (2) adding some leverage.

    Looking for a disciplined approach to managing stock market risk on a daily basis? Check Out My "Daily Decision" System. Forget the fast money and the latest, greatest option trade. What investors need is a strategy to keep them "in" the stock market during bull markets and on the sidelines (or short) during bear markets.

    Turning to This Morning...

    Although the current decline in stock prices appears to quickly becoming overdone in the near-term, traders are clearly more comfortable selling than buying at this time. Markets in China bucked the trend overnight with Shanghai gaining nearly 2% and Hong Kong up 1% on hopes for monetary stimulus. However, new concerns about Russia/Ukraine are keeping European bourses in the red and U.S. futures on the defensive.

    Pre-Game Indicators

    Here are the Pre-Market indicators we review each morning before the opening bell...

    Major Foreign Markets:
    - Japan: -1.36%
    - Hong Kong: +0.98%
    - Shanghai: +1.90%
    - London: -0.87%
    - Germany: -0.74%
    - France: -0.77%
    - Italy: -1.37%
    - Spain: -1.56%

    Crude Oil Futures: +$0.91 to $101.35

    Gold: +$14.00 at $1312.30

    Dollar: higher against the yen, lower vs. euro and pound

    10-Year Bond Yield: Currently trading at 2.713%

    Stock Futures Ahead of Open in U.S. (relative to fair value):
    - S&P 500: -1.81
    - Dow Jones Industrial Average: -3
    - NASDAQ Composite: -1.55

    Thought For The Day...

    What lies behind us and what lies before us are tiny matters compared to what lies within us. -Ralph Waldo Emerson

    Positions in stocks mentioned: none

    Follow Me on Twitter: @StateDave


    The opinions and forecasts expressed herein are those of Mr. David Moenning and may not actually come to pass. Mr. Moenning's opinions and viewpoints regarding the future of the markets should not be construed as recommendations. The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of StateoftheMarkets.com and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. One should always consult an investment professional before making any investment.

    Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.

    The analysis provided is based on both technical and fundamental research and is provided "as is" without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

    The information contained in this report is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also President and majority shareholder of Heritage Capital Management, Inc. (HCM) a Chicago-based money management firm. HCM is registered as an investment adviser. HCM also serves as a sub-advisor to other investment advisory firms. Ridge is a publisher and has not registered as an investment adviser. Neither HCM nor Ridge is registered as a broker-dealer.

    Employees and affiliates of HCM and Ridge may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Editors will indicate whether they or HCM has a position in stocks or other securities mentioned in any publication. The disclosures will be accurate as of the time of publication and may change thereafter without notice.

    Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.

    Apr 08 8:22 AM | Link | Comment!
  • Mo-Mo Is Suddenly A No-No

    Daily State of the Markets
    Monday, April 7, 2014

    The timing of Friday's dance to the downside, which seemingly came out of nowhere, was a bit eerie. No sooner had we penned a piece talking about the need to have a plan of action the next time the bears come to call than our furry friends seemed to suddenly awaken.

    As is usually the case on the first Friday of each month, the majority of market watchers were focused on the Jobs data. The Bureau of Labor Statistics reported that Nonfarm Payrolls, which is one of the most closely followed gauges regarding the state of the economy, increased by 192K in the month of March. The number of new jobs was slightly below the consensus estimates for an increase of 197K and in line with February's revised 197K. However, the revisions to the prior two months reports were significant as February's totals were upped by 22K to 197K while January's job total was revised higher by 15K to 144K.

    Stock futures improved after the report was released and it looked like Friday was setting up to be a bullish event. The S&P opened at a new all-time high and both DJIA and Midcap indices joined in on the new high fun.

    The Fun Didn't Last Long

    However, the joyride to the upside didn't last long. As I tweeted Friday morning, the boys and their computer toys didn't waste too much time before launching an attack on the indices.

    "Algos wait exactly one minute before resuming the attack on internet and social media. Q is will the selling gain traction again today?"

    - StateOfTheMarkets (@StateDave) April 4, 2014

    The Real Key To Friday Was Simple

    The bottom line here is simple. Don't listen to the popular press. Friday's decline had NOTHING to do with the Jobs report. Or the Fed. Or China. Or Russia. Or the economy...

    No, the almost instantaneous reversal from new all-time highs and the ensuing shellacking of the indices was all about "the trade." And right now, "the trade" that the big boys are playing is to sell the heck out of the former momentum leaders in the areas of Biotechnology, Social Media, and Internet.

    Mo-Mo Stocks Under Attack

    In case you haven't been paying close attention, the mo-mo names (aka the momentum oriented trades that tend to get overdone to the upside) have fallen out of favor lately.

    For example, Amazon.com (NASDAQ: AMZN) is down -20.6 percent from its January high.

    Amazon.com Daily

    Yelp (NASDAQ: YELP) has crashed -32.9 percent in just over a month.

    Yelp Daily

    And Twitter (NASDAQ: TWTR), which had seen shares spike from the November IPO price of $44.50 to $73.31 (a gain of 65 percent) in a month and a half, has been beaten unmercifully for a loss of -38 percent since mid-December

    Twitter Daily

    Biotech has been no picnic either as the SPDR S&P Biotech ETF (NYSE: XBI) has fallen -21.8 percent since the end of February.

    SPDR Biotech ETF Daily

    Now compare the charts above to that of the venerable S&P 500 index and note the striking divergence seen over the last couple of months between the "mo-mo" crowd and the broad market.

    S&P 500 Daily

    A Bad Day or Problems Coming Home To Roost?

    As the chart of the S&P 500 clearly illustrates, the overall market has largely ignored the fact that the mo-mo names have been taken out back behind the woodshed recently. But up until Friday morning, this was a "trade" that the hedgies had been playing and only the "fast money" geniuses worried about.

    However, with the Dow and S&P popping their heads up into fresh all-time high territory, it appears that the powers-that-be decided it was time to shake things up and try a trade to the downside.

    Maybe the fact that it was Friday was the reason buyers simply stood aside as wave after wave of sell programs hit the market. Maybe it was the fact that valuations have gotten a little rich lately. Maybe it was the fact that May is coming - and the bottom line here is that just about everybody on the planet is looking for a solid "Sell in May and go away" trade this year. Or, as the bears contend, maybe the market's "issues" are finally coming home to roost.

    Mo-Mo Had Gotten out of Hand

    To be sure, the momentum names had gotten a bit out of hand lately. And as anybody who has ever tried to "buy high and sell higher" will attest, the game usually ends badly when stocks become the darlings of the mo-mo crowd and wind up "going parabolic."

    Friday's action sure smacked of panic selling. Thus, the question of the day is if the problems in mo-mo-land will wind up causing investors of all sizes to start dumping stocks en masse.

    However, it was pretty obvious that Friday's action was driven by sell algos - from 9:31 am eastern until 4:00 pm. And given that the "fast money" types have the attention span of a gnat, it will be interesting to see if any real fear was created - or if this was simply a day when the sellers had their way.

    So, if you are interested in such things, now would be the time to watch closely how the next day or two unfolds. The intraday action could tell us an awful lot about whether or not the bears have gained the upper hand.

    And speaking of the bears, I haven't forgotten that I promised to provide a simple plan to help folks be prepared for the next bear market. My hope is to be able to detail an idea or two starting tomorrow. Unless of course, the sky starts to fall before then!

    Looking for a disciplined approach to managing stock market risk on a daily basis? Check Out My "Daily Decision" System. Forget the fast money and the latest, greatest option trade. What investors need is a strategy to keep them "in" the stock market during bull markets and on the sidelines (or short) during bear markets.

    Turning to This Morning...

    Friday's surprise dance to the downside on Wall Street has spilled over to the overnight markets as Asian and European stock market indices are down across the board. Concerns about the momentum selloff and a new report from the World Bank trimming growth forecasts for China are also weighing on sentiment this morning. U.S. futures are falling again alongside Europe and point to more selling at the open on Wall Street.

    Pre-Game Indicators

    Here are the Pre-Market indicators we review each morning before the opening bell...

    Major Foreign Markets:
    - Japan: -1.69%
    - Hong Kong: -0.59%
    - Shanghai: closed
    - London: -0.74%
    - Germany: -1.43%
    - France: -0.84%
    - Italy: -0.60%
    - Spain: -0.69%

    Crude Oil Futures: -$0.43 to $100.71

    Gold: -$4.10 at $1299.40

    Dollar: higher against the yen, lower vs. euro and pound

    10-Year Bond Yield: Currently trading at 2.724%

    Stock Futures Ahead of Open in U.S. (relative to fair value):
    - S&P 500: -5.15
    - Dow Jones Industrial Average: -34
    - NASDAQ Composite: -22.02

    Thought For The Day...

    Live for today for tomorrow never comes. -English Proverb

    Positions in stocks mentioned: none

    Follow Me on Twitter: @StateDave


    The opinions and forecasts expressed herein are those of Mr. David Moenning and may not actually come to pass. Mr. Moenning's opinions and viewpoints regarding the future of the markets should not be construed as recommendations. The analysis and information in this report and on our website is for informational purposes only. No part of the material presented in this report or on our websites is intended as an investment recommendation or investment advice. Neither the information nor any opinion expressed nor any Portfolio constitutes a solicitation to purchase or sell securities or any investment program. The opinions and forecasts expressed are those of the editors of StateoftheMarkets.com and may not actually come to pass. The opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security nor specific investment advice. One should always consult an investment professional before making any investment.

    Any investment decisions must in all cases be made by the reader or by his or her investment adviser. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that the investment objectives outlined will actually come to pass. All opinions expressed herein are subject to change without notice. Neither the editor, employees, nor any of their affiliates shall have any liability for any loss sustained by anyone who has relied on the information provided.

    The analysis provided is based on both technical and fundamental research and is provided "as is" without warranty of any kind, either expressed or implied. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

    The information contained in this report is provided by Ridge Publishing Co. Inc. (Ridge). One of the principals of Ridge, Mr. David Moenning, is also President and majority shareholder of Heritage Capital Management, Inc. (HCM) a Chicago-based money management firm. HCM is registered as an investment adviser. HCM also serves as a sub-advisor to other investment advisory firms. Ridge is a publisher and has not registered as an investment adviser. Neither HCM nor Ridge is registered as a broker-dealer.

    Employees and affiliates of HCM and Ridge may at times have positions in the securities referred to and may make purchases or sales of these securities while publications are in circulation. Editors will indicate whether they or HCM has a position in stocks or other securities mentioned in any publication. The disclosures will be accurate as of the time of publication and may change thereafter without notice.

    Investments in equities carry an inherent element of risk including the potential for significant loss of principal. Past performance is not an indication of future results.

    Apr 07 8:11 AM | Link | Comment!
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