Look for A Long Term Red LAMPP Signal Next Week (And Start Shorting)

The Long Term LAMPP is on the verge of turning red, possibly as soon as next week. The LAMPP index has descended right to its 78 week moving average. Crossing below that moving average would turn the signal red.

The short term LAMPP remains on red for the 8th straight week, in what was at least a premature signal, but not necessarily a wrong signal. In my short term trades list in the Wall Street Examiner Pro Trader Market Update there are now more shorts than longs and the shorts turned more profitable than the longs in the last week. Those are signs of a market in intermediate transition.

And that at least partly validates the Short Term LAMPP red signal. The market averages have been rising on an ever narrowing list of participating stocks. The averages are masking spreading technical weakness in an increasing number of stocks. Air pockets have developed in many names as they report worse then expected earnings. You may have seen this in your own portfolio over the last two weeks. The market averages rarely tell the whole story, and sometimes, like now, they tell a misleading story.

In the next week or couple of weeks the LAMPP will cross below its 78 week moving average. That will be a red signal. It will be time to get out of stocks. Tops take months to roll over, so there’s probably no urgency to “sell everything,” but we should stay on a systematic program of regular sales to build a substantial cash holding by March of 2018. I’m looking at 60-70% of a portfolio in cash. Your goal would differ depending on your personal needs. As an older person, I might want to hold an even higher percentage of cash.

I also think that it’s probably ok to start shorting the market now by shorting the SPY, or buying inverse ETFs. I would not use leveraged ETFs or puts unless you are an experienced technical trader, or are comfortable with a third party timing service such as the Wall Street Examiner Pro Trader Market updates.

The Long Term LAMPP has weakened in the past several weeks because Treasury supply is increasing, just as I had forecast…

It’s Just Possible That I’ve Featured Your Burning Question Here…

The analytical work that I do for you deals with issues that may be at times complex, or may be difficult to grasp at first. That is simply because the mainstream media either doesn’t cover them, or covers them in a way that is misleading. They are presenting the views of Wall Street, and Wall Street’s goal is always to separate you from your money. So they either feed you a lot of meaningless stories or they outright mislead you, in order to get your money under their control. Once they do that, their skim begins.

Well, I want to help you understand enough about how the market really works so that you can manage your own investments successfully, and with a minimal investment of your own time. I’ll do the heavy lifting for you, and present critical information that will enable you to surely make your own decisions about managing your own money, or at least to ride herd over the people who do, so that they don’t squander it.

With those goals in mind, today I’m beginning a new feature here at Sure Money. I hope that it is one that you will enjoy, and will help you better understand the things you really need to know to first protect your capital, and second, to make it grow.

Starting today, I will respond to your comments and questions posted on Sure Money and Money Morning. Those comments, questions (and criticisms) help me to get my message to you in a way that’s clear and understandable. Your feedback tells me where I’m succeeding, and where I’m missing the boat. It helps me to be the best communicator I can be in helping to reach your investment goals.

The comments section on the website is open right now, so I hope you’ll ask me any questions I didn’t cover here. Fire away and you’ll likely see your name in an upcoming issue!

Here’s what you wanted to know