V2 Model Aug. 29, 2020 Update

Good Morning!

Welcome new members.

Here is how V2 and our benchmark for the SP500 (SPY) performed:

This week:

V2 up 11.6%

SPY up 3.27%

This year:

V2 up 190.33%

SPY up 10.08%

V2 had a strong week. Our holding,TQQQ, posted double digit gains and the V2 ratio is above cross over points, in bullish order and improved 16.35% for the week. All good.

Below is the chart of the V2 Ratio #2. A few couple fo things to point out:

The Ratio made a new higher high and is in bullish order.
RSI is in overbought territory. See the red oval. This may indicate we are do for a short term pull back.

I also enclosed a 5-year, weekly, ratio chart of QQQ vs TLT. This is one common measure of "Risk On" (QQQ) vs "Risk Off" (TLT, 20- year Treasuries) in the market. QQQ is also the basis for our current holding in TQQQ. You can see we are breaking out of a multi-year consolidation box. The longer we stay above this box, the more good things could happen in the longer term. There is an old saying, "The longer things go sideways the larger the movement may be". You can see we have been in the box for almost 3 years. So if we hold and extend above this area we could be seeing the start of a multi-year run up in QQQ.

The two points above are not forecasts. We must keep an open mind to changes in either direction. We must follow the math.

V2 remains long TQQQ.

The V2 Model has performed exactly as expected.

Distance=Victory

Chris

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