Readers of the swingtrader.com blog will have noticed that the overall theme that I have proposed is that to be a successful swing trader one has to understand the principle of relative strength with positive momentum.
I originally proposed the concept in an e-book that I had offered in 2000. Because of my lack of web marketing, it was only downloaded a few times, although it was free.
Over the past few months, I have received multiple offerings of momentum services that offer similar strategies that I have been discussing on my swingtrader.com, relativevalue.com and perfectstormtradingstrategy.com websites for the past ten years or more.
One of the offers was a service, using only four ETF’s, that the provider stated would constantly beat the market.
Among the offers are those by Market Geeks, Wyatt Investment Research, Portfolio Research Partners ,Investors Business Daily’s Swing Trader and Morpheus Trading Group. All discuss momentum and relative value. I am sure that there are many others.
Over the next few weeks and months, I am going to have on the swingtrader.com website an example, updated weekly or daily if necessary, of my 4 ETF strategy. If followed, the strategy should emulate the best of the services being offered. It is certainly not a recommendation of what to buy or sell, but an example of what can be accomplished by using a relative strength with momentum strategy. It is for illustrative purposes ONLY!
The four ETF’s chosen are the result of my own research. They should portray a representation of the changes in market sector rotation. The four ETF’s have positive and negative correlation with each other. The ETF’s are displayed here on weekly and daily charts.
I will update the daily and weekly charts when appropriate.
Remember: Green=XLE, Red=XLY, Light Blue=XLU, Yellow=IYT
Latest update December 30, 2016 Close
I have done a similar study on 6 countries ETF’s. Please contact me if you would like a copy.