The BLUE LINE INVESTING® April 2019 Primary Trend Update

Commentary: The US stock market, as measured by the S&P 500 Index (S&P) finished the month of April 6.70% above the BLUE LINE, compared to +4.00% above the BLUE LINE at the end of March. We continue to categorize the primary trend as Neutral.


The chart below is a weekly version of the S&P of the past five years. Each vertical line on the chart represents one week of price behavior.

From a technical analysis perspective, the S&P may be at resistance. If you refer to “Sideways Trend 1” that occurred from 2014 through 2016, you will notice price bounced like a ping-pong ball between the upper and lower dashed gray lines as price consolidated past gains. If price fails to make material progress from current price levels it is possible the market may do something similar over the coming months and/or quarters. Based on our observations, we believe it is possible that prices could “bounce” down 11% from current prices if Sideways Trend 2 plays out. Please note – we are not predicting this will happen. We are simply pointing out what could happen if the current primary trend is a sideways trend, compared to a rising trend.

For clients of BLUE LINE INVESTING® please do not hesitate to call us with questions at (833) 258-2583.

Jeff Link



BLUE LINE INVESTING® (BLI) is an investment process that seeks to align investment decisions with the prevailing primary trend of the financial markets. BLI seeks to remain fully invested when the financial markets are experiencing either a long-term rising primary trend or a short-to-intermediate sideways trend. When the primary trend begins declining however, the process follows a 3-phase sell process to attempt to limit downside loss. We believe Warren Buffett said it best with his two rules: “Rule No. 1 – Never lose money. Rule No. 2 – Never forget Rule No. 1.”

The S&P 500 Index is one of the most commonly followed equity indices, and many consider it one of the best representations of the U.S. stock market, and a bellwether for the U.S. economy. It is comprised of 500 large companies having common stock listed on the NYSE or NASDAQ. The volatility (beta) of the account may be greater or less than the index. It is not possible to invest directly in this index.

Technical analysis is a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volumes. Technical analysis attempts to predict a future stock price or direction based on market trends. The assumption is that the market follows discernible patterns and if these patterns can be identified then a prediction can be made. The risk is that markets may not always follow patterns. There are certain limitations to technical analysis research, such as the calculation results being impacted by changes in security price during periods of market volatility. Technical analysis is one of many indicators that may be used to analyze market data for investing purposes and should not be considered a guaranteed prediction of market activity. The opinions expressed are those of BLI. The opinions referenced are as of the date of publication and are subject to change without notice. BLI reserves the right to modify its current investment strategies based on changing market dynamics or client needs.

Past performance is not indicative of future results. This material is not financial advice or an offer to sell any product. The information contained herein should not be considered a recommendation to purchase or sell any particular security. Forward looking statements cannot be guaranteed.

Advisory services offered through Aptus Capital Advisors, LLC, a Registered Investment Adviser registered with the Securities and Exchange Commission. Registration does not imply a certain level or skill or training. More information about the advisor, its investment strategies and objectives, is included in the firm’s Form ADV Part 2, which can be obtained, at no charge, by calling (251) 517-7198. Aptus Capital Advisors, LLC is headquartered in Fairhope, Alabama.