V2 Model March 5, 2022 UPDATE

March 05, 2022

Recap

The stock market was afflicted by a 25% pop in oil prices, which were driven by worsening developments surrounding Russia's invasion of Ukraine. The Nasdaq Composite dropped 2.8%, followed by losses in the Russell 2000 (-2.0%), Dow Jones Industrial Average (-1.3%), and S&P 500 (-1.3%).

V2 was up this week as we maintained our defensive short/cash position.

Performance This Week / YTD

V2 +2.35 / -11.91%

SPY -1.27% / -9.01%

QQQ -2.45% / -15.22%

Changes

None.

V2 Holdings (Allocation)

TZA (33%)

CASH (67%)

Charts

The first chart is of the V2 Ratio for TZA. It was very tight but we closed above the cross line by a narrow margin of only .14% to end the week. Not pictured here but momentum, trend strength, and relative strength all improved on a short-term basis. As such, we are not making changes at this time.

The second chart is the Sp500 Index weekly for the past 10 years. For only the 4th time in the period we had a weekly close below the 50 EMA and MACD momentum turning negative. You can see every time this has happened the market moved lower after this milestone. There is now a higher probability of the SP500 moving lower in the coming weeks perhaps to the 3800 to 3500 area. Time will tell.

We are running a number of tests this weekend to see if adding to our short position is warranted. I will keep you posted.

Notes

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Plan

Our plan going forward? Market trends may change and they may change rapidly. We will stay nimble and be vigilant to changes in either direction. We will follow the math.

Distance=Victory

Chris

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