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May 31, 2012 at 09:29 AM EDT
Sell in May and Go Away best investment move so far?
Thursday, May 31, 9:25 a.m. Justin Harper, market strategist at IG Markets in Singapore said last night, “The phrase ‘sell in May and go away’ was probably the best investment move you could have made. Markets pretty much gave back all their first quarter gains in May.” Yes, May was a bad month. But so [...]

Thursday, May 31, 9:25 a.m.

Justin Harper, market strategist at IG Markets in Singapore said last night, “The phrase ‘sell in May and go away’ was probably the best investment move you could have made. Markets pretty much gave back all their first quarter gains in May.”

Yes, May was a bad month. But so was April. So also was the last half of March.

Most global markets actually topped out in mid-March, making the last half of March, all of April, and all of May quite ugly times to be in the market.

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Our Seasonal Timing Strategy did quite well with its exit signal April 20. But I liked our signal in our non-seasonal Market-Timing Strategy just as well. It came off its October buy signal in mid-February, prompting us to take our profits from its October buy signal.

In fact, I liked the buy signal from both strategies in October just as well. And the sell signals of both last April.

But that’s history. What comes next is what counts now.

In the U.S. market will it be a summer rally in June and July like the 7% rally last June and July?Or did the rally in April in the U.S. market this year satisfy that similarity to last year? 

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Would you like to be a Certified Financial Advisor?

The annual CFA exams will take place this Saturday, thought by many to be the hardest exams taken by Wall Street professionals. As Ben Duronio points out on Business Insiders, fewer than 20% of candidates pass the exams on the first attempt. That’s an even lower percentage than law candidates who pass the bar exams on the first attempt, or accountants who pass the board exams to become CPA’s on the first attempt.

The CFA requirements are as demanding as any profession.

After fulfilling the education and experience requirements comes the exams, a series of three, Level I, Level II, and Level III, each given separately.

The topics covered in alphabetical order include Alternative Investments, Behavioral Finance, Corporate Finance, Derivatives, Economics, Equity Investments, Financial Statement Analysis, Fixed Income, Communications Skills, Performance Measurement & Evaluation, Portfolio Management, Private Wealth Management, Quantitative Analysis Methods, Risk Management, Standards Ethics, & Regulations, etc.

Level I exams are offered twice a year, in June and December. Level 11, and Level III exams are given only once a year, in June only.

It’s the Level I and Level II exams being offered on Saturday. The exams for each level are all-day affairs, with a morning and afternoon session.

The best of luck to this year’s candidates. 

To read my weekend newspaper column click here: Stop the Noise – Americans Aren’t Dumb! May 25, 2012

Subscribers to Street Smart Report: In addition to the information in the premium content’ area of this morning’s blog, there is an in-depth ‘U.S. Markets’ update from yesterday in the subscribers’ area of the Street Smart Report website. Please also stay tuned to the hotline!

Yesterday in the U.S. Market.

The U.S. market followed markets in Europe in experiencing a down day that gave back all of yesterday’s gains, with the market closing just about at its low for the day after a late day attempt to rally back failed.

The Dow closed down 160 points, or 1.3%. The S&P 500 closed down 1.4%. The NYSE Composite closed down 1.9%. The Nasdaq closed down 1.2%. The Nasdaq 100 closed down 0.8%. The Russell 2000 closed down 2.0%. The DJ Transportation Avg. closed down 2.1%. The DJ Utilities Avg closed down 0.8%.

Gold closed up $15 an ounce at $1,564, now down only $8 for the week so far.

Oil closed down a big $2.94 a barrel (3.3%) at $87.82.

The U.S. dollar etf UUP closed up 0.8%.

The U.S. Treasury bond etf TLT closed up 2.5%.

Yesterday in European Markets.

European markets closed down sharply yesterday. The London FTSE closed down 1.7%. The German DAX closed down 1.8%. France’s CAC index plunged 2.2%.

Asian Markets were mostly down again last night.

The Asia Dow closed down 0.3% last night.

Among individual markets:

Australia closed down 0.4%. China closed down 0.5%. Hong Kong closed down 0.3%. India closed down 0.6%. Indonesia closed down 2.2%. Japan closed down 1.1%. Malaysia closed up 0.3%. New Zealand closed up 0.1%. South Korea closed down 0.1%. Singapore closed down 0.4%. Taiwan closed up 0.6%.

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Markets This Morning:

European markets gave back earlier gains after release of the U.S. economic reports and are now mixed. The London FTSE is up 0.3%. The German DAX is down 0.2%. France’s CAC is up 0.1%.

Oil is down $.12 a barrel at $87.70.

Gold is up $2 an ounce at $1,566 an ounce.

This Morning in the U.S. Market:

This week is a very heavy week for potential market-moving economic reports, which include the ADP Monthly Jobs Report, Chicago PMI, the next Revision to 1st Quarter GDP, the ISM Mfg Index, and The Big One!, the Labor Department’s monthly jobs report for May. To see the full list and times for each release click here, and look at the left side of the page it takes you to.

Tuesday it was the Case-Shiller Home Price Index, which showed that home prices fell fractionally in March, just 0.03%, and adjusted for seasonal factors were up fractionally, 0.09%. And the Conference Board reported that its Consumer Confidence Index plunged in May in its biggest monthly drop in 8 months, dropping to 64.9 from 68.7 in April, versus the consensus forecast of an improvement to 70.0. The board noted the reading is well below the 90 reading that indicates a healthy economy, but still well above the all-time low of 25.3 of February, 2009. The problem of course is that it’s heading in the wrong direction.

Yesterday it was that the NAR Pending Home Sales Index fell 5.5% in April, its first decline in four months.

Overnight, India reported its economy (GDP) slowed to 5.3% growth in the 1st quarter, sharply lower than the previous quarter, and the forecasts of 6.1%.

This morning it was that new weekly unemployment claims jumped by 10,000 last week to 383,000, worse than forecasts of a drop to 370,000, and the 4-week moving average rose by 3,750 to 374,500. And the ADP Monthly Jobs Report was that 133,000 new jobs were created in May in the private sector, and the report for April was revised down to a gain of only 113,000 from the prior report of 119,000. And 1st quarter GDP was revised down to growth of only 1.9% from the previous report of 2.2%.

Still to come is the Chicago PMI Index, which will be released in 15minutes, at 9:45 a.m.

The pre-open indicators have been holding up well in the face of another batch of disappointing economic reports.

Our Pre-Open Indicators:

Our pre-open indicators are pointing to the Dow being down 10 points or so in the early going, meaningless as to direction later.

To read my weekend newspaper column click here: Stop the Noise – Americans Aren’t Dumb! May 25, 2012

Subscribers to Street Smart Report: In addition to the information in the premium content’ area of this morning’s blog, there is a hotline from last night and an in-depth ‘U.S. Markets’ update from yesterday, in the subscribers’ area of the Street Smart Report website. Please also stay tuned to the hotline!

I’ll be back with the next regular blog post on Saturday morning, as usual later then the week-day updates, probably around 11 a.m. eastern time.

Non-subscribers: We believe we can help you not only make more profits, but just as importantly avoid losses, and at very reasonable cost!

Our portfolios were up an average of 9.4% last year in a flat year (S&P 500 unchanged for year) when many, if not most, managers and funds were down for the year. We were on Hulbert’s Ten Best Newsletters of the Year list for the 2nd time in 4 years, and #4 Long-Term Market-Timer in Timer Digest’s rankings. And we are off to an even better start this year, ranked #1 Long-Term Market Timer so far in 2012.

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