At -6.03%, the average loss was more than three times greater than this week's average gain.
Now, as you know (because you read it here) the declines we saw two weeks ago we expected. The market had gotten very overbought in the short term and needed a corrective pullback.
That said, it's good to see the market pause to digest that recent decline instead of springing back up.
We saw some other signs of normalcy this past week...
The Nasdaq Composite outperformed the other major indices. That feels normal given that, as a broad market sector, Technology has been outperforming all others for more than three years.
The Russell 2000, our small-cap proxy, came in second. You'd expect to see that as the economy recovers. So that's another welcome "boring" indication.
The "internal" market confirms the "steady as she goes" tone.
Last week (on June 13th) our primary risk barometer -- the New York Stock Exchange Bullish Percent Index (NYSE BPI) flipped into O's.
(We won't go into detail about that here; you can read more about it on our free BPI page.)
What's important is that when the chart flipped, it displayed a reading of 59.98, meaning that a shade under 60% of NYSE stocks were trading on point-and-figure "Buy signals" at that time.
What does the chart say now, one week later?
The chart is still in that same O's column and it has not filled in any additional O-boxes.
But we've seen a bit of improvement. Right now 60.91% of NYSE stocks are on Buy signals. That's 1.55% more than a week ago.
Slow and steady.
Then there's market "breadth".
In our Premium data and research program, Sector Prophets Pro (SPP), we take daily "snapshots" of the entire market, broken down by sectors, or industry groups.
After the market closed on Friday (June 19th) the SPP data engine generated this picture:
As you can see, bulls (or Demand) now control 38% of sectors.
Last week at this time the bulls controlled 29% of sectors.
So, again, we see improvement within the internal market... but we don't see any dizzying flip-flopping from bearish to bullish (or vice versa).
Again, it's good to see the market digesting recent moves.
At times like this it can be a useful exercise to simply take stock (no pun intended) of where we've been and how far we've come.
This column came to life on June 22, 2019.
If you're a regular reader, you know that since then we've had our share of triumphs...
Such as the fast double-digit gain on Live Person (LPSN) back in July 2019. We got in near $32 and within 33 days the stock was up 26%.
We score again with software company Sapiens International (SPNS).
We got in near $15.50 and saw the stock climb more than 50% over the next three months.
I received an email from a reader named Al B., (who must have bought the Call option) who said, "I've been reading Small-Cap Saturday articles diligently. In your article of 8/3, you wrote about a company Sapiens International (SPNS). So far I've made a 100% return on my money".
Not that we didn't have out share of disappointments -- we did, especially after COVID-19 popped onto the scene like a lethal jack in the box.
On January 11th I pounded the table about oil tanker stocks and wrote about International Seaways (INSW).
Not since the "Wreck of the Edmund Fitzgerald" has anything ocean-going sunk so far so fast. By the time the market bottomed on March 23rd, INSW had lost 45% of its value.
Mercifully, no-one wrote in to rake me over the coals. Most likely because nearly every other stock was also down, and some by much more than -45%.
Some of our more recent plays are doing well. On May 10th I recommended HYG, the largest high-yield bond ETF. That one got up about 7% in 25 days before pulling back.
The option -- the November 74 Strike Call -- is up about 41%.
On June 6th we got into two ETFs from the Gaming sector -- ESPO and BJK.
The results have been mixed.
As of Friday ESPO is up 5.77% while the BJK is down -7.32%.
Of course a lot more happened over the past year (I grew one year younger, if you can believe that...)
And I feel I've detained you enough for one summer Sunday.
But before I go, I want to say THANK YOU to two extraordinary (And extraordinarily devoted) fathers -- Chris Rowe...
and Costas Bocelli.
I've watched in awe as they've built True Market Insiders into what's arguably the fastest-growing investing publication in the world. (That it's the best financial publication is not arguable.)
As you know, I have a pretty extensive roster of contacts that I've built up over the years. Well, if I have a "grapevine" Chris Rowe has an entire vineyard.
And I'll never forget (this was more than a decade ago) when he began telling me about this genius from the Philadelphia Stock Exchange -- a guy named "Costas" -- that his people were buzzing about.
Of course Chris did more than buzz. He resolved to bring Costas to the attention of the world. I and thousands of readers are very grateful that he did just that.
The simple fact is that "Small-Cap Saturday" wouldn't exist in not for Chris and Costas.
I'm what's known as a "creative supportive". I've always been most comfortable working behind the scenes. I'm a bass player, not a lead singer.
Chris and Costas pushed me to step out. They saw something in me I couldn't see in myself.
Most importantly, neither would take "No... NO!... NOOOOO!" for an answer.
So they (gently) pushed and prodded...
And here we are!
I think it's that persistent quality that makes both guys such extraordinary teachers. And it shows in the work they do in their courses and webinars and trading services.
They both genuinely believe that anyone can learn to trade like a master.
So ladies and gentlemen...
Please give a warm ovation to the True Market Insiders "Founding Fathers" -- Chris and Costas!
By the way... One of these Founding Fathers is presenting a FREE investor briefing this coming Thursday (June 25th).
If you have yet to see Chris in action as he reveals his latest high-gain trading strategies...
Then you'll want to go here now and lock down a free seat.
Until then, thank you from the bottom of my heart for your support this past year.
And here's wishing you a healthy and profitable summer.
The best is yet to come!
Bill Spencer
True Market Insiders
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