April 16: Play Defense With These Six ETFs

Richard1944

The 20+ Year Treasury Bond ETF (TLT)

The U.S. Treasury 30-Year Bond ETF trades like a stock using the 20+ Year Treasury Bond ETF, which a basket of U.S. Treasury bonds with maturities of 20+-Years to 30-Years. As a stock-type investment it never matures, and interest income is converted to periodic dividend payments.

The Treasury Bond ETF ($120.90 on April 13) is above its 50-day simple moving average at $119.43 and below the 200-day simple moving average at $123.90.

The weekly chart remains positive with the ETF above its five-week modified moving average of $120.61, and below its 200-week simple moving average or “reversion to the mean” of $124.70. The 12x3x3 weekly slow stochastic reading rose to 40.71 last week up from 33.73 on April 6.

Investor Strategy: Reduce holdings on strength to my quarterly and monthly risky levels of $122.01 and $123.62, respectively.

The Gold Bullion ETF (GLD)

Investors can trade gold bullion like a stock using the SPDR Gold Shares ETF.

The Gold Bullion ETF ($127.45 on April 13) is above its 50-day simple moving at $126.16 and above its 200-day simple moving average at $123.08.

The weekly chart for the Gold Bullion ETF is neutral with the ETF above its five-week modified moving average of $126.25. GLD is above its 200-week simple moving average, or “reversion to the mean” at $117.94 which held at the December low. The 12x3x3 weekly slow stochastic reading slipped to 53.73 last week down from 55.61 on April 6.

Investor Strategy: Based upon this analysis, buy weakness to my quarterly and semiannual value levels $125.75 and $118.74, respectively, and reduce holdings on strength to my annual risky level of $146.20. My monthly pivot is $127.48.

The Utilities ETF (XLU)

Investors seeking the safety of dividends can trade the utilities ETF, which is a basket of 28 utility stocks. The current dividend yield is 3.06%.

The Utility Stock ETF ($49.79 on April 13) is above its 50-day of $49.68 and below its 200-day simple moving averages of $52.70.

The weekly chart for the Utilities Sector ETF is neutral with the ETF below its five-week modified moving average of $50.09 and above its 200-week simple moving average or ‘reversion to the mean’ at $47.89, which was tested at the Feb. 6 low of $47.37. The 12x3x3 weekly slow stochastic reading rose to 52.73 last week up from 44.13 on April 6.

Investor Strategy: Buy weakness to the 200-week simple moving average of $47.89 and reduce holdings on strength to my monthly, quarterly and annual risky levels of $52.02, $52.62 and $54.46, respectively.

SPDR Bloomberg Barclay’s High Yield Bond ETF (JNK)

Investors should avoid junk bonds as they correlate more to stocks than U.S. Treasuries.

The Junk Bond ETF ($36.16 on April 13) is above its 50-day simple moving average of $35.97 and below its 200-day simple moving averages at $36.75.

The weekly chart for the junk bond ETF is positive with the ETF above its five-week modified moving average of $36.03 and below its 200-week simple moving average or the “reversion to the mean” of $37.13 last tested during the week of Nov. 14, 2014 when the average was $40.08. The 12x3x3 weekly slow stochastic reading rose slightly to 32.26 up from 31.22 on April 6.

Investor Strategy: Based upon this analysis, buy weakness to my semiannual value level of $33.99 and reduce holdings on strength to my annual and quarterly risky levels of $37.15 and $38.80, respectively. My monthly pivot is $35.95.

iShares S&P GSCI Commodity-Indexed Trust ETF (GSG)

The commodity ETF is heavily-weighted to energy by about 60%.

The Commodities ETF ($17.18 on April 13) is above its 50-day and 200-day simple moving averages of $16.46 and $15.48, respectively.

The weekly chart for the commodity ETF is positive with the ETF above its five-week modified moving average of $16.59 and below its 200-week simple moving average or the “reversion to the mean” of $17.92, last tested during the week of July 11, 2014 when the average was $33.40. The 12x3x3 weekly slow stochastic reading rose to 60.47 last week up from 56.95 on April 6.

Investor Strategy: Based upon this analysis, buy weakness to my annual pivot at $16.20 and reduce holdings on strength to the 200-week simple moving average of $17.92 as my quarterly and monthly risky levels of $17.17 and $17.23 have been tested.

PowerShares DB US Dollar Index Bullish ETF (UUP)

Investors interested in buying the dollar versus a basket of currencies trade this ETF. It includes below long the dollar vs. Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona and Swiss Franc.

The Dollar ETF ($23.54 on April 13) is above its 50-day simple moving average of $23.50 and below the 200-day simple moving averages of $24.04.

The weekly chart for the bullish dollar ETF is neutral with the ETF just below its five-week modified moving average of $23.57 and is below its 200-week simple moving average or ‘reversion to the mean’ of $24.64. The 12x3x3 weekly slow stochastic reading rose to 49.45 last week up from 41.54 on April 6.

Investor Strategy: Based upon this analysis, buy weakness to the 50-day simple moving average which is rising each week to $23.50 and reduce holdings on strength to my quarterly and semiannual risky levels of $24.82 and $27.37, respectively. My monthly and annual pivots are $23.75 and $24.18, respectively.

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