401K Monthly Analysis – Summer Rally or Not 7/4/16

My daily SPY analysis shows an exit down signal; which I interpret as Up; but the market has been trading sideways for a while. The resolution to the sideways move will either be up or down. With Brexit, we saw volatility spike and then quietly ebb away. Fade the down move the market said. So here we are again at a sideways situation. What can I squeeze out of the charts for clues? And what are they telling us right now?

Gold has been steadily moving up. I have to believe that based on the chart for GLD shown below. NUGT, the Gold Miner’s ETF has gone nuts. Over the last few months it has moved up from the 20s to 144. Talk about a big move…  And the bond funds have also gone up. See chart for TLT, 20 year Treasury bond fund ETF, below. And stocks? Well they are also holding their own. But something has to give. We can’t have Gold, bond funds and stock funds all harmoniously going up. They don’t like each other…Which will give ground?

Looking at the chart for SPY I see a slight divergence between the indicator peaks, (red line) and the SPY’s peaks (blue line). SPY has gone up but not convincingly. So here I go again. I will be cautious and stay on the side lines. If we breakout then the market will rip and I will be crying about missing the Summer rally for sure!

With my previous employer’s 401K funds, the top funds from the monthly analysis are Spartan 500 fund (same as SPY), Fidelity Equity Income and Fidelity Growth Strategies. Royce is actually at the top but it is very volatile, and also has a short term trading redemption fee in case I want to get out within a month.  

I have not started downloading and analyzing my current employer’s 401K funds. But I will next month. I am putting as much money as I can into my 401K every month; all into a docile fund.