Positive Weekly Charts For Treasuries And Utilities Say Play Defense

Investors trade ETFs for bonds, gold, utility stocks, junk bonds, commodities and dollar.

The 20+ Year Treasury Bond ETF (TLT)

The U.S. Treasury 30-Year Bond ETF trades like a stock using the 20+ Year Treasury Bond ETF, which a basket of U.S. Treasury bonds with maturities of 20+-Years to 30-Years. As a stock-type investment it never matures, and interest income is converted to periodic dividend payments.

The Treasury Bond ETF ($121.90 on March 29) traded to its 52-week high of $129.56 on Sept. 7, then declined to $116.51 on Feb. 21. The ETF is above its 50-day simple moving average at $119.87 and below the 200-day simple moving average at $124.21.

The weekly chart has been upgraded to positive with the ETF above its five-week modified moving average of $120.40, and below its 200-week simple moving average or “reversion to the mean” of $124.60. The 12x3x3 weekly slow stochastic reading rose to 26.68 moving above the oversold threshold of 20.00.

Based upon this analysis, buy weakness to my monthly value level of $118.82, and reduce holdings on strength to my quarterly risky level of $135.08.

The Gold Bullion ETF (GLD)

Investors can trade gold bullion like a stock using the SPDR Gold Shares ETF.

The Gold Bullion ETF ($125.79 on March 29) set its 52-week high of $129.51 on Jan. 25 up from a low of $117.40 on Dec. 12. GLD is now below its 50-day simple moving at $126.25 and above its 200-day simple moving average at $122.69.

The weekly chart for the Gold Bullion ETF is negative with the ETF just below its five-week modified moving average of $125.83. GLD is above its 200-week simple moving average, or “reversion to the mean” at $117.88 which held at the December low. The 12x3x3 weekly slow stochastic reading slipped to 57.99 last week down from 63.01 on March 23.

Based upon this analysis, buy weakness to my semiannual value level $118.74, and reduce holdings on strength to my weekly risky level of $127.37.

The Utilities ETF (XLU)

Investors seeking the safety of dividends can trade the utilities ETF, which is a basket of 28 utility stocks. The current dividend yield is 3.06%.

The Utility Stock ETF ($50.53 on March 29) set its all-time intraday high of $57.23 on Nov. 15, which was a test of my quarterly risky level of $57.22 at that time. XLU is above its 50-day of $49.66 and below its 200-day simple moving averages of $52.87.

The weekly chart for the Utilities Sector ETF is positive with the ETF above its five-week modified moving average of $50.09 and above its 200-week simple moving average or ‘reversion to the mean’ at $47.82, which was tested at the Feb. 6 low of $47.37. The 12x3x3 weekly slow stochastic reading rose to 36.26 last week up from 28.73 on March 23.

Investment Strategy: Buy weakness to the 200-week simple moving average of $47.83 and reduce holdings on strength to my annual and semiannual risky levels of $54.46 and $58.60, respectively.

SPDR Bloomberg Barclay’s High Yield Bond ETF (JNK)

Investors should avoid junk bonds as they correlate more to stocks than U.S. Treasuries.

The Junk Bond ETF ($35.85 on March 29) set its 52-week high of $37.46 on July 26, 2017 and then traded as low as $35.36 on Feb. 9, following the trend for stocks. The ETF has been below a ‘death cross’ since Dec. 7 when the ETF closed at $36.74. The 50-day and 200-day simple moving averages are now $36.17 and $36.81, respectively.

The weekly chart for the junk bond ETF is negative with the ETF below its five-week modified moving average of $36.06 and below its 200-week simple moving average or the “reversion to the mean” of $37.18 last tested during the week of Nov. 14, 2014 when the average was $40.08. The 12x3x3 weekly slow stochastic reading slipped to 35.29 last week down from 39.30 on March 23.

Based upon this analysis, investors should buy weakness to my semiannual value level of $33.99. Reduce holdings on strength to my annual risky levels of $37.15.

iShares S&P GSCI Commodity-Indexed Trust ETF (GSG)

The commodity ETF is heavily-weighted to energy by about 60%.

The Commodities ETF ($16.65 on March 29) set its 52-week low of $13.16 on June 21, 2017 and then the heavily-weighted to energy futures ETF traded as high as $17.22 on Jan. 25, following the positive effect of the “golden cross” that was confirmed on Oct. 20 when the ETF closed at $15.01. This ETF is above its 50-day and 200-day simple moving averages of $16.50 and $15.32, respectively.

The weekly chart for the commodity ETF is positive with the ETF above its five-week modified moving average of $16.48 and below its 200-week simple moving average or the “reversion to the mean” of $18.09, last tested during the week of July 11, 2014 when the average was $33.40. The 12x3x3 weekly slow stochastic reading rose to 56.54 last week up from 55.51 on March 23.

Based upon this analysis, buy weakness to the 200-day simple moving average of $15.32 and rising each day. My annual pivot is $16.20. Reduce holdings on strength to the 200-week simple moving average of $18.09 and declining each week.

PowerShares DB US Dollar Index Bullish ETF (UUP)

Investors interested in buying the dollar versus a basket of currencies trade this ETF. It includes below long the dollar vs. Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish Krona and Swiss Franc.

The Dollar ETF ($23.61 on March 29) has been trading lower since testing $24.75 on Oct. 27, 2017. The dollar set its 52-week low of $23.08 on Jan. 25 which was a test of my monthly value level in January. The dollar is above its 50-day simple moving average of $23.46 and below the 200-day simple moving averages of $24.11.

The weekly chart for the bullish dollar ETF is positive with the ETF just above its five-week modified moving average of $23.57 and is below its 200-week simple moving average or ‘reversion to the mean’ of $24.61. The 12x3x3 weekly slow stochastic reading rose to 35.46 last week up from 32.01 on March 23.

Based upon this analysis, buy weakness to my monthly value level of $23.19, and reduce holdings on strength to my semiannual risky level of $27.37. My annual pivot is $24.18.

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