New Positions Are Warranted, But Defensive Sector Strength Signals Modest Caution (The ETF Trader And Investor For The Week Of 10/5-10/9)

This column assumes that ETFs are the primary investment tool for the reader.

Please see my weekly market summation for a review of the macro-economic environment and general macro-level market trends.

Investment thesis: the macro-averages are now in a bullish posture; it’s a good time to take a new position. But be careful; defensive sectors are starting to rise, indicating traders are a bit more cautious.

Let’s start by looking at last week’s market activity, beginning with the treasury market:

TLT 5-day

The treasury market moved lower on Monday and then traded sideways for the rest of the week. Volatility was higher on late Tuesday and Wednesday as the market digested the whipsaw activity regarding additional fiscal measures. Also note the sharp sell-off and subsequent rally on Friday, likely due to additional fiscal talk.

SPY 5-day

SPY trended higher for the entire week as shown by the central tendency line

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Va. Tech football approaching opener with caution amid pandemic

“We’re all living in a test-by-test world now,” Fuente said Monday during a Zoom call with reporters. “So we’ll see as they come. Hopefully everything works out fine. I’m not trying to raise alarm, but I’m also not trying to — I’m just being honest with the situation we’re in.

“I mean we’re just trying to make it to each day to see where it’s at, and hopefully we’re on the right side of where this thing’s trending.”

With the No. 20 Hokies preparing for their season opener set for 8 p.m. Saturday against North Carolina State at Lane Stadium, Fuente spent a portion of this week awaiting virus test results for his players and staff.

The last of three tests per week as mandated for all ACC schools comes Friday, at which time Fuente will be able to determine his starters with at least some degree of certainty.


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