Sector Rotation 8/11/2011

XLK (if you are long), or
XLE (if you are short).

Since I'm reserving my own XLK trade to coincide with the Robot, I'm updating Billy's sector pivots in the Algo forum.

But XLK should work for a 20DMF buy signal also (though Billy's pivots DO offer quite an edge).

Without pivots I'd try to enter at the previous day's close, rather than chase the price.

As for long term timing -- my long term models are showing a potential bottom around 696-808 in 2012 on the S&P500. That's a pretty serious bear market, but would serve as a double bottom on a secular bear (2009 and 2012). I don't do Elliot Wave or any vodoo like that. This is just based on the fact that the Fed yield rates are pegged near zero and the market is STILL failing. If you have the gas floored and the car is still slowing down, something's pretty wrong with that engine...

Personally, I'm playing for a bounce by exiting my XLE hedge and just riding the Mousetrap selections back up, hopefully up toward the long term moving averages before everyone gives up the ghost. When the 20DMF gives the next sell signal, my sector rotation model will likely short XLE, but I'll update when that happens.

Tim