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Tuttle Tactical Management Weekly Market Commentary

Tuttle Tactical Management, LLC is an investment adviser registered with the U.S. Securities and Exchange Commission. You should not assume that any discussion or information contained in this letter serves as the receipt of, or as a substitute for, personalized investment advice from Tuttle ...

02/27/2013

For a while it was obvious that the market had become overbought and was due for a selloff, all traders needed was an excuse, this past week they got two of them.  First, the Fed hinted that QE might end and then Italian elections sparked uncertainty in Europe.  Add those things in with the looming sequester and you have all the ingredients for a profit taking selloff.  At this point this is all part of normal market machinations.  The market doesn’t go up in a straight line and it doesn’t go down in a straight line.  Markets overreact on both sides in the short term and then eventually go back to equilibrium.

Equity Markets
Our momentum indicators are still extremely bullish on the stock market.  Our positive reading on stocks does not mean that the market is guaranteed to rise from here.  There are still many risks on the horizon (Poor corporate earnings, problems in Europe, slowing economy, partisan bickering in Washington, etc) that could cause a selloff. However, our research suggests that when our momentum indicators are bullish the rewards of being invested outweigh the risks.

In the US we continue to have equal positions in the S&P 500, Mid Cap, and Small Cap stocks.  Globally, we continue to favor broad based International Developed Stocks.  We sold our shorter term counter-trend positions before the selloff and bought some of them back yesterday—Small Cap Stocks and S&P 500.

Equity Matrix

 

 

Time Frame

 

 

Market Condition

 

 

TTM Positioning

 

 

Short Term

 

 

Slightly Overbought

 

 

50% Invested- Small Cap & S&P 500

 

 

Intermediate Term

 

 

Uptrend

 

 

Fully Invested- S&P 500, Small Cap & Mid Cap US Stock

Fixed Income Markets
Our momentum indicators show all areas of the bond market are weakening.  High yield bonds are still the only area we see with any momentum as they can tend to trade more like stocks than bonds at times.

We continue to hold our counter trend position in long term Treasuries.  We understand that over the intermediate and long term Treasuries are probably the worst bet you can make, but over the short term they are looking oversold and have provided protection during the selloff.

Fixed Income Matrix

 

 

Time Frame

 

 

Market Condition

 

 

TTM Positioning

 

 

Short Term

 

 

Oversold

 

 

100% Invested in Treasury Bonds

 

 

Intermediate Term

 

 

Most markets in a downtrend

 

 

1/4 Invested in High Yield Bonds


Top Holdings

1. Cash

2. Mid Cap US Stocks

3. Small Cap US Stocks

4. S&P 500

 

Tuttle Tactical Management, LLC is an investment adviser registered with the U.S. Securities and Exchange Commission. You should not assume that any discussion or information contained in this letter serves as the receipt of, or as a substitute for, personalized investment advice from Tuttle Tactical Management, LLC. It is published solely for informational purposes and is not to be construed as a solicitation nor does it constitute advice, investment or otherwise. To the extent that a reader has questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional adviser of his/her choosing. A copy of our written disclosure statement regarding our advisory services and fees is available upon request. Our comments are an expression of opinion. While we believe our statements to be true, they always depend on the reliability of our own credible sources. Past performance is no guarantee of future returns.
Certified Financial Planner® Board of Standards, Inc. owns the certification marks CFP®, Certified Financial Planner® and federally registered CFP® in the U.S., which it awards to individuals who successfully complete the CFP® Board’s initial and ongoing certification requirements.

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