Friday, July 2, 2010

SPY Monthly

The exchange-traded fund tht tracks the S&P 500 SPY) in June closed below the 12-month simple moving average on the monthly chart after 11 months of above-average closes.

This is significant for very long-term traders, people with money in a 401(k) or mutual fund where rapid-fire trades are discouraged. Or for people with a life, who just don't want to give their days over to the markets -- a perfectly sane position to take.

SPY closed the month at $103.22. The entry point -- the monthly close for July 2009 -- was $98.81. So the bull phase produced a 4.5% gain over the 11 months, which is 4.9% annualized.

Beats the bank, but it's not great. Certainly, it pales beside the last bull phase, from May 2003 through November 2007, which produced a 61.7% gain total, or 13.5% per year.

Presumably, we're all now moving safely into cash, or somewhat less safely, into a bond fund, there to away the next cross above the 12-month moving average, which closed June at $108.19.


The Great Reflation: How Investors Can Profit From the New World of Money
OK. The credit bubble burst. Housing, burst. Shockwaves reverberated. Markets collapsed. What lies ahead as we remerge from the wreckage.



Disclaimer
Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.


No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

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