Greece, Spain, Portugal, has now spread over to the rest of Europe and the whole world. If your trading plan is the 50 day moving average, you need to be paying attention. Including today’s sell off, the majority of Indexes of the 53 Indexes in our Daily Trading Signal Service are now below their 50 day moving averages, today there were several more on Sell Signals. We monitor trading signals for 53 Indexes at www.seleznovcapitaladvisors.com
System Trader’s and Market Timing traders may use the 50 day Simple Moving Average as their trading plan. The 50 day moving average is basic technical analysis. It is a good market timing trading plan for active trading in indexes and ETF’s that have trend following characteristics. It can produce disastrous results if used for every stock index, ETF, or stock.
Other widely followed moving averages are the 100 day moving average and the 200 day moving average. Some money managers will use these moving averages with a shorter moving average and use the cross of the shorter moving average above or below the longer moving average to generate trading signals. The Wall Street Journal displays the 65 day moving average in their charts. The goal of two moving averages and even 3 moving averages is to eliminate whipsaws that often occur with moving averages as a technical analysis indicator.
Why should you care about the signals produced with the 50 day moving average? There are so many people using the 50 day moving average, that we will often see extreme volatility in indexes when they cross both above and below the 50 day moving average.
The below table shows the current 50 day simple moving average condition on the 50 most actively traded ETF’s.
| Security Name | Trend2 | Ticker |
| Barclays High Yield Bond | New Short | JNK |
| BRIC IShares | Stay Short | BKF |
| Coal Power Shares | Stay Short | PKOL |
| DB Commodity Index | Stay Long | DBC |
| Diamond Trust DOW | Stay Long | DIA |
| Energy Select SPDR | Stay Long | XLE |
| Internet Holders | New Short | HHH |
| IPath India Index | New Short | INP |
| IShare Russell 2000 | Stay Long | IWM |
| IShares 25 Index | Stay Short | FXI |
| IShares Australia | Stay Short | EWA |
| IShares Basic Materials | New Short | IYM |
| IShares DJ Real Estate | Stay Long | IYR |
| Ishares DJ Transportation | Stay Long | IYT |
| Ishares Emerging Markets | New Short | EEM |
| IShares Financial Sector | Stay Long | IYF |
| IShares Germany | New Short | EWG |
| IShares Hong Kong | Stay Short | EWH |
| IShares Latin America | New Short | ILF |
| IShares Mexico | New Short | EWW |
| IShares Mid Cap 400 | Stay Long | IJH |
| IShares MSCI EAFE | Stay Short | EFA |
| IShares MSCI Japan | New Short | EWJ |
| IShares Pacific ex Japan | Stay Short | EPP |
| IShares S&P 500 Growth | New Short | IVW |
| Ishares S&P Small Cap 600 | Stay Long | IJR |
| IShares Silver | Stay Long | SLV |
| IShares South Africa | New Short | EZA |
| IShares South Korea | New Short | EWY |
| IShares Taiwan | New Short | EWT |
| IShares United Kingdom | Stay Short | EWU |
| NDX 100 | Stay Long | QQQQ |
| Oil Service Holders | Stay Short | OIH |
| Pharmaceutical Holders | Stay Short | PPH |
| PowerShares US Dollar Index | Stay Long | UUP |
| Russia | New Short | RSX |
| RYDEX S&P 500 Equal Weight | Stay Long | RSP |
| S&P 500 | Stay Long | SPY |
| Semiconductor Holders | Stay Long | SMH |
| SPDR Consumer Descretionary | Stay Long | XLY |
| SPDR Consumer Staples | New Short | XLP |
| SPDR Gold Shares | Stay Long | GLD |
| SPDR Healthcare | Stay Short | XLV |
| SPDR Industrial Sector | Stay Long | XLI |
| SPDR International Real Estate | New Short | RWX |
| SPDR Materials | New Short | XLB |
| SPDR Metal & Mining | Stay Short | XME |
| SPDR Mid Cap | Stay Long | MDY |
| SPDR S&P Homebuilders | Stay Long | XHB |
| SPDR Technology | New Short | XLK |
| Steel Market Vector | Stay Short | SLX |
| US Oil | New Short | USO |
| Wisdom Tree Total Dividend | Stay Long | DTD |
You should not trade any system trading plan without proper back testing and analysis of the trading characteristics of the index, stock or ETF you are trading.
These trading signals are provided courtesy of the website you are viewing. This information should not be used without research and advice from a financial professional.
Be aware that this condition can and will change any day in the future.
We monitor the 50 day moving average daily along with a number of other system trading plans.
There is No “Holy Grail” in trading systems. Do not use the 50 day SMA or any other system trading system without proper research on the asset.
For questions on rule based, system trading, contact
mark@seleznovcapitaladvisors.com
www.seleznovcapitaladvisors.com
