VIG Newsletter July 27 Update

Seasonal Bounce to September?

Recap

The stock market had a mixed showing this week. The S&P 500 (-0.8%) and Nasdaq Composite (-2.1%) logged declines since last Friday while the Russell continued its recent action, jumping 3.5% this week. The Dow Jones Industrial Average was also higher, up 0.8%.

The underperformance of the S&P 500 and Nasdaq Composite was due to ongoing profit-taking activity in the mega-cap and semiconductor spaces.

The Vig Co. portfolio was down this week.

Performance (Weekly/YTD)

VIG Co. -2.7% / +2.66%

SPY -.83% / +15.27%

VIG Co. Portfolio Holdings (Allocation).

VIG V4 (100%)

Notes/Charts

Here are a few things we are watching.

Seasonal info from Carson Research. You can see we followed this path lower in July. Will we see a rebound until mid-August? A weak September and October. Then, a strong finish to the year?

More info from Carson Research. You can see that historically we average nearly six 2 percent drops a year. You can see this year we are well below average. I would expect more volatility going forward - especially in September.

We will watch key earnings this week on Tuesday, Wednesday, and Thursday. This will set the near-term trend.

Semiconductors 2-hour chart. Do we have a near-term bottom? You can see the quick dip and strong reversal on extreme volume this past Thursday. This would suggest a “buy the dip” event and a near-term bottom.

QQQ weekly. QQQ dropped nearly 10% over the past 3 weeks - a common correction. We exactly tagged the 20-week moving average and rebounded - perhaps indicating a near-term bottom.

Plan

We will follow the math.

Chris

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