ETFs, Leveraged ETFs, Sector Funds

[No-Quarter]

One more tool to consider is an over all market momentum indicator. Something that is like a barometer for the stock market. Shows not only a relative position (high or low), but also a direction (rising or falling).

The one I use is the $USHL5 in Stockcharts. This tool gathers the entire US market of stocks, determines which ones have hit a new high over the past 5 days, which ones have hit a new low over the past 5 days, and compares the two.

http://stockcharts.com/h-sc/ui?s=$USHL5&p=D&yr=1&mn=9&dy=0&id=p25593898639

I draw different horizontal 'Decision' lines on this chart than the two lines shown. I draw three lines. One line at '0', another line at '1000', and a third line at '2300'.

Below 0 is Negative (Bearish).
Between 0 and 1000 is Neutral.
Between 1000 and 2300 is Positive.
Above 2300 is Bullish.

I also add a 5 day Simple Moving Average (SMA) line 'overlay' to this graph to indicate meaningful direction changes.

I will close out ALL MY POSITIONS when the chart AND the 5 day SMA line are both below 0, regardless of what Surfer tells me.

I will not enter back in until both are above 1000.

GLTY!