Some drivers see a yellow light and speed up… some drivers see a yellow and slow down… and others don’t seem to pay attention to any color of stoplight. The same goes for many investors, but since you are reading Hedgefolios … I assume that a yellow light will cause you to reflect on your portfolio. As I wrote in yesterday’s post, last week was very destructive to the technicals of so many companies, and as a result, I am flashing a big yellow light on the market.

Please do not confuse this with me giving a market call as I don’t like market calls in general, and more specifically, I don’t make any recommendations of what you should do with your money. Besides, market calls tend to be forgotten when they are wrong and only hyped the few times they are right. Some analysts and pundits still have the claim-to-fame of having called 1987’s Black Monday and yet, we have hardly heard from many of them since then and certainly not since 2000. Amazingly, it seems that they have either not made any other calls since 1987 or they haven’t made any that were too correct (that’s the one I am going with.) So - I’d rather not go down that road and hope that you use this yellow light to decide whether you want to speed up or slow down. That’s much more important than whether I am right about my concerns.

Back to the signals - this week I gave 363 new stock signals (see the MANAGE section) and only 50 of these were new “UP” signals (14%). As a result, there were over 6 new “DOWN” signals for every 1 new “UP” signal. Ratios like that are relatively uncommon at Hedgefolios and always give me reason to pause and do more analysis. In addition to the changes to stock signals, I also changed 13 ETF signals from “UP” to “DOWN”. Note that there were no new signals in the positive direction.

Lastly, if you look at the Hedgefolios Timing Indicator in the ANALYZE - MARKET STATISTICS section you will see that there was a crossover of the HF Bullish (Green) and HF Bearish (Red) lines. This has only happened three times in the past year and according to my methodologies, indicates that the market has a negative bias. I’ve been waiting for a crossover to post a more detailed description of this section and my market indicators - so look for one by tomorrow.

I am slowing down to reflect on the market’s yellow light… there’s a lot to analyze about geopolitics, oil, and interest rates.