View from Toronto: S&P 500 Trading Strategy, Sectors, Buy & Sell Lines

12/12/2018 2:02 pm EST

Focus: MARKETS

Ziad Jasani

Managing Director and Partner, Independent Investor Institute

Triple bottom or the bottom falls out? If the S&P 500 is able to hold above 2,604 and bounce back above 2,650 (SPY ~ $265.32) a move back towards 2,737 or higher becomes more likely, says Ziad Jasani Monday in commentary and video here.

video

View my weekly strategy session video here.
Recorded: Dec. 10, 2018.
Duration: 1:37:07.

The bulk of the cyclical sectors within the S&P 500 (listed as the higher risk spaces in the sector positioning chart below), the Nasdaq (QQQ), Small Caps (IWM), Growth (IVW) and Hi-Beta (SPHB) would be viable to play for a short-to-mid-term swing-low (days-to-weeks).

The distance upwards between 2,604 – 2,650 would be better to use day-trading as a gateway to build swing-trades.

However, if the S&P 500 breaks support of the Oct. 29 lows (2,603.54) a re-test of the calendar year lows (2,532.85) or lower becomes likely; wherein sell decisions for longer-term investors kick-in and short-to-mid-term traders utilize inverse ETFs to capture profit from the downside (SH, SDS, PSQ, SQQQ, DOG, DXD).

chart

Chart: S&P 500 sector positioning


• Materials (XLB, GDX, SIL, XME)
o XLB: Hold > $51.48 | Hold-To-Buy $52.39 | Sell-Line: $51.48 & $50.40
o XME: Hold > $27.52 | Hold-To-Buy > $28.58 | Sell-Line: $27.52
o GDX: Hold > $19.81 | Hold-To-Buy > $20.15| Sell-Line: $20.15 & $19.81
o SIL: Hold > $23.26 | Hold-To-Buy > $23.84 | Sell-Line: $23.26 & $22.70

• Industrials (XLI, DIA)
o XLI: Hold > $66.99 | Hold-To-Buy > $68.63 | Sell-Line: $66.99
o DIA: Hold > $243.59 | Hold-To-Buy > $245.10 | Sell-Line: $240.85

chart 2

Chart: Sector weights and details

• Staples (XLP)
o XLP: Hold > $54.14 | Hold-To-Buy > $54.85 | Sell-Line: $54.14

• Financials (XLF, KBE, KRE, KIE)
o XLF: Hold > $24.81 | Hold-To-Buy > $25.46 | Sell-Line: $24.81
o KBE: Hold > $40.31 | Hold-To-Buy > $41.68| Sell-Line: $40.31
o KRE: Hold > $51.92 | Hold-To-Buy > $51.92| Sell-Line: $51.92
o KIE: Hold > $29.29 | Hold-To-Buy > $29.49 | Sell-Line: $29.49 & $28.87

• Healthcare (XLV, XBI, IBB, XPH, XHE)
o XLV: Hold > $89.94 | | Hold-To-Buy > $91.77 | Sell-Line: $89.94
o XPH: Hold > $40.50 | Hold-To-Buy > $41.36 |Sell-Line: $40.50
o XBI: Hold > $77.08 |Hold-To-Buy > $79.63| Sell-Line: $77.08 & $75.10
o XHE: Hold > $72.60 | Hold-To-Buy > $74.30 | Sell-Line: $72.60 & $71.71
o IBB: Hold > $102.09 | Hold-To-Buy > $104.85 | Sell-Line: $102.09

• Discretionaries (XLY, XHB, XRT)
o XLY: Hold > $103.01 | Hold-To-Buy > $103.01| Sell-Line: $101.51
o XHB: Hold > $34.00 | Hold-To-Buy > $34.00 | Sell-Line: $34 & $33.15
o XRT: Hold-To-Buy > $44.12 | Sell-Line: $42.70

• REITs (XLRE, VNQ)
o VNQ: Hold-To-Buy > $81.76 | Sell-Line: $81.76 & $80.76
o XLRE: Hold-To-Buy > $34.10 | Sell-Line: $33.52

• Utilities (XLU)
o XLU: Hold > $55.71 | Hold-To-Buy > $55.71| Sell-Line: < $55.22

• Technology (QQQ, XLK, IYW, FNG)
o QQQ: Hold >$158.62 | Hold-To-Buy >$161.32 | Sell-Line: $156.42
o XLK: Hold > $64.22 | Hold-To-Buy > $65.50 | Sell: $63.31
o IYW: Hold > $ 162.55 | Hold-To-Buy > $166.37 | Sell: $162.55
o FNG: Hold > $16.37 | Hold-To-Buy > $17.30 | Sell: $16.37

• Energy (XLE, XOP, RYE, XES)
o XLE: Hold-To-Buy > $64.67 | Sell-Line: $62.83
o XOP: Hold-To-Buy > $32.52 | Sell-Line: $30.96
o RYE: Hold-To-Buy > $50.24 | Sell-Line: $48.56
o XES: Hold > $10.78 | Hold-To-Buy > $11.55 | Sell-Line: $10.40

• Telecom & Communication Services (IYZ, XLC)
o IYZ: Hold > $27.68 |Hold-To-Buy > $28.10 | Sell-Line $27.28
o XLC: Hold > $42.38 | Hold-To-Buy > $43.50 | Sell-Line $42.38

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