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Systematic Trading Plan: Current 200 Day Moving Average Signals for June 16, 2010

|Includes: BFK, BKF, DBC, DIA, DTN, EEM, EEP, EFA, EPP, EWA, EWG, EWH, EWJ, EWT, EWU, EWW, EWY, EZA, FXI, GLD, HHH, IJH, IJR, ILF, INP, IVW, IWM, IYF, IYR, IYT, JNK, MDY, OIH, PKOL, PPH, QQQ, RSP, RSX, RWX, SLV, SLX, SMH, SPDR S&P 500 Trust ETF (SPY), USO, UUP, XHB, XLB, XLE, XLI, XLK, XLP, XLV, XLY, XME
For the first time in 20 days of trading, the S&P 500, SPY closed back above the 200 day moving average. The Dow Jones Industrial Average also closed back above the 200 day moving average. There seems to be a change of direction going on in many of the major averages. Will this be a whipsaw or the start of a new trend? Keep checking to see if this signal keeps traders on a Buy Signal.
 
At Seleznov Capital Advisors we watch these key levels to see the Index breaks down or the trend continues up. You can get these trading alerts nightly from our Daily Trading Signals Service. If you are using the 200 day moving average as the indicator, this chart of the SPY, S&P 500 should interest you.
System Trader’s and Market Timing traders may use the 200 day Simple Moving Average as their trading plan. The 200 day moving average is basic technical analysis. It is a good market timing trading plan for active trading in indexes and ETF’s that have trend following characteristics. It can produce disastrous results if used for every stock index, ETF, or stock.
Other widely followed moving averages are the 50 day moving average and the 100 day moving average. Some money managers will use these moving averages with a shorter moving average and use the cross of the shorter moving average above or below the longer moving average to generate trading signals. The Wall Street Journal displays a 65 Day Moving Average in their charts. The goal of two moving averages and even 3 moving averages is to eliminate whipsaws that often occur with moving averages as a technical analysis indicator.
 Why should you care about the signals produced with the 200 day moving average? There are so many people using the 200 day moving average, that we will often see extreme volatility in indexes when they cross both above and below the 200 day moving average. It has been reported that Endowments like Harvard and Yale use the 200 Day Moving Average in modeling their portfolios.
The below chart shows the current 200 day simple moving average condition on over 50 most actively traded ETF’s. 
Security Name Trend3 Ticker
Barclays High Yield Bond Stay Short JNK
BRIC IShares Stay Short BKF
Coal Power Shares Stay Short PKOL
DB Commodity Index Stay Short DBC
Diamond Trust DOW New Long DIA
Energy Select SPDR Stay Short XLE
Internet Holders Stay Short HHH
IPath India Index Stay Long INP
IShare Russell 2000 Stay Long IWM
IShares 25 Index Stay Short FXI
IShares Australia Stay Short EWA
IShares Basic Materials New Long IYM
IShares DJ Real Estate Stay Long IYR
Ishares DJ Transportation Stay Long IYT
Ishares Emerging Markets Stay Short EEM
IShares Financial Sector Stay Short IYF
IShares Germany Stay Short EWG
IShares Hong Kong Stay Short EWH
IShares Latin America Stay Short ILF
IShares Mexico Stay Long EWW
IShares Mid Cap 400 Stay Long IJH
IShares MSCI EAFE Stay Short EFA
IShares MSCI Japan Stay Short EWJ
IShares Pacific ex Japan Stay Short EPP
IShares S&P 500 Growth New Long IVW
Ishares S&P Small Cap 600 Stay Long IJR
IShares Silver Stay Long SLV
IShares South Africa New Long EZA
IShares South Korea New Long EWY
IShares Taiwan Stay Short EWT
IShares United Kingdom Stay Short EWU
NDX 100 Stay Long QQQQ
Oil Service Holders Stay Short OIH
Pharmaceutical Holders Stay Short PPH
PowerShares US Dollar Index Stay Long UUP
Russia Stay Short RSX
RYDEX S&P 500 Equal Weight Stay Long RSP
S&P 500 New Long SPY
Semiconductor Holders Stay Long SMH
SPDR Consumer Descretionary Stay Long XLY
SPDR Consumer Staples New Long XLP
SPDR Gold Shares Stay Long GLD
SPDR Healthcare Stay Short XLV
SPDR Industrial Sector Stay Long XLI
SPDR International Real Estate Stay Short RWX
SPDR Materials Stay Short XLB
SPDR Metal & Mining Stay Long XME
SPDR Mid Cap Stay Long MDY
SPDR S&P Homebuilders Stay Long XHB
SPDR Technology New Long XLK
Steel Market Vector New Long SLX
US Oil Stay Short USO
Wisdom Tree Total Dividend New Long DTD
You should not trade any system trading plan without proper back testing and analysis of the trading characteristics of the index, stock or ETF you are trading. 
These trading signals are provided courtesy of the website you are viewing. This information should not be used without research and advice from a financial professional.
Be aware that this condition can and will change any day in the future.
We monitor the 200 day moving average daily along with a number of other system trading plans.
There is No “Holy Grail” in trading systems. Do not use the 200 day SMA or any other system trading system without proper research on the asset.
For questions on rule based, system trading, contact
mark@seleznovcapitaladvisors.com