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Dow, S&P rise in wild day, Nasdaq takes China hit – RSI picks VXZ September 29, 2011

Posted by Marlowe Cassetti in VXZ.
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Stocks mostly rose in a volatile session on Thursday as stronger-than-expected economic data and German approval of a beefed-up euro-zone crisis fund relieved two of the worst fears hanging over the market.

But the Nasdaq was knocked lower by a brutal sell-off in U.S.-listed Chinese stocks on news of a probe into accounting practices and profit taking in Apple shares after a huge gain during the quarter.

The Dow Jones industrial average .DJI gained 143.08 points, or 1.30 percent, to 11,153.98. The Standard & Poor’s 500 Index .SPX gained 9.34 points, or 0.81 percent, to 1,160.40. But the Nasdaq Composite Index .IXIC dropped 10.82 points, or 0.43 percent, to 2,480.76. (commentary & photo courtesy of Reuters)

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The RSI portfolio was dead flat today. However wasn’t asleep today since it had a buy pick:

  • Buy 71 shares iPath S&P 500 VIX Mid-Term Futures ETN (VXZ); Volatility = 8.0%

It turns out that the RSI portfolio already holds this fund and it has been an excellent gainer, 11% since it was purchased on August 30th. It still looks good although money flow (lower plot) is fading. But can volatility keep increasing? We shall see.

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