JULY Performance in Brief
Nothing much to brag about in July. The market has taken its toll on semiconductors and AI, believing they are overinvested with little to show for it. Much the same for SpaceX. A lot of enthusiasm but little to show.
Where does the market go next? Indications are for healthcare, but that’s always been a good sector. Now there is cyclosporasis, an opportunity for a new vaccine! Defense stocks are another possibility, given the supposed shortage in arms. And then there is always a war somewhere.
In-Person Appearances
Perry is planning a 3-day seminar with Kevin Davey on September 24-26th in Chicago. They will discuss their best strategies. There will be
- Lots of new material
- Long-term and short-term strategies
- A chance to talk to both of us
- Programs and spreadsheets
- Recorded
Anyone interested in further information should go to the MasterClass Website at https://buy.stripe.com/cNi9ATc0FcIt2Xgg6tfbq2j
Perry will also be:
- A key speaker at the 40th anniversary of the Italian Society of Technical Analysis in Brescia on September 19th.
- A key speaker at the IFTA conference, October 9-10 in London
Kaufman’sMost Popular Books (available on Amazon)
Trading Systems and Methods, 6th Edition. The complete guide to trading systems, with more than 250 programs and spreadsheets. The most important book for a system developer.
Kaufman Constructs Trading Systems. A step-by-step manual on how to develop, test, and trade an algorithmic system.
Learn To Trade. Written for both serious beginners and practiced traders, this book includes chart formations, trends, indicators, trading rules, risk, and portfolio management. You can find it in color on Amazon.
You can also find these books on our website, www.kaufmansignals.com.
Blogs and Recent Publications
Find Mr. Kaufman’s other recent publications and seminars at the end of this report. We post new interviews, seminars, and reference new articles by Mr. Kaufman each month.
Major Equity ETFs
While NASDAQ reflected the change in sentiment, the rest of the index markets were relatively flat – after giving back most of their July gains. The DOW (DIA) was the least affected. We expect it to stabilize here, with traders looking for a new area to place their investments.
Our programs are profitable except for futures, which seems to have a difficult time finding a trend. The Weekly equity program has come back to earth, but it still higher by 37% this year. If you close your eyes to the volatility, it doesn’t look bad!
A Standing Note on Short Sales
Note that the “All Signals” reports show short sales in stocks and ETFs, even though short positions are not executed in the equity portfolios. Our work over the years shows that downturns in the stock market are most often short-lived and it is difficult to capture with a longer-term trend. The upwards bias also works against shorter-term systems unless using futures, which allows leverage. Our decision has been to take only long positions in equities and control the risk by exiting many of the portfolios when there is extreme volatility and/or an indication of a severe downturn.
PORTFOLIO METHODOLOGY IN BRIEF
Both equity and futures programs use the same basic portfolio technology. They all exploit the persistence of performance, that is, they seek those markets with good long-term and short-term returns on the specific system, rank them, then choose the best, subject to liquidity, an existing current signal, with limitations on how many can be chosen from each sector. If there are not enough stocks or futures markets that satisfy all the conditions, then the portfolio holds fewer assets. In general, these portfolios are high beta, showing higher returns and higher risk, but have had a history of consistently outperforming the broad market index in all traditional measures.
PERFORMANCE BY GROUP
NOTE that the charts show below represent performance “tracking,” that is, the oldest results since are simulated but the returns from 2013 are the systematic daily performance added day by day. Any changes to the strategies do not affect the past performance, unless noted. The system assumes 100% investment and stocks are executed on the open, futures on the close of the trading day following the signals. From time to time we make logic changes to the strategies and show how the new model performs.
Groups DE1 and WE1: Daily and Weekly Trend Program for Stocks, including Income Focus, DowHedge, Sector Rotation, and the New High-Risk Portfolio
The Trend program seeks long-term directional changes in markets and the portfolios choose stocks that have realized profitable performance over many years combined with good short-term returns. It will hold fewer stocks when they do not meet our condition and exit the entire portfolio when there is extreme risk or a significant downturn.
Equity Trend
A wild ride for the Weekly Trend program, but still holding a gain of 37% for the year. We knew it would happen eventually, but the volatility is extreme. There is a lot of position switching in the weekly program, trying to find the next best markets, or at least reducing the risk.Equity Trend
Income Focus and Sector Rotation
Small losses while the interest rate market still remains uncertain. The Fed left rates unchanged while the market wanted an increase. The affects of oil may be “temporary” but it’s taking a long time!
Weekly Sector Rotation
Despite everything that’s going on, the Sector Rotation program is holding its own. Higher by 1.6% for a 2026 gain of 11.7%. It seems be a good hedge for the main index markets.
DowHedge Programs
Losses in the daily program and gains in the weekly, put these programs at nearly the same year-to-date. The daily is up by 18% and the weekly by 21%. You can see on the earlier chart of the index markets that the DOW (DIA) has been the strongest in July.
High-Risk Portfolios
Even trading the AI and semis, the setback on the high-risk portfolio wasn’t as bad as the weekly program. Perhaps the daily changes helped. The 5-stock portfolio was off by 15% but is still higher by 75%. The larger 10-stock portfolio was off by 4% for a gain of 47%. That’s if you can stand the risk!
Group DE2: Divergence Program for Stocks
The Divergence program looks for patterns where price and momentum diverge, then takes a position in anticipation of the pattern resolving itself in a predictable direction, often the way prices had moved before the period of uncertainty.
Small losses in the 10-stock portfolio and unchanged in the 30-stock, this program still doing well this year, up by 22% and 18%.
Group DE3: Timing Program for Stocks
The Timing program is a relative-value arbitrage, taking advantage of undervalued stocks relative to its index. It first finds the index that correlates best with a stock, then waits for an oversold indicator within an upwards trend. It exits when the stock price normalizes relative to the index, or the trend turns down. These portfolios are long-only because the upwards bias in stocks and that they are most often used in retirement accounts.
While it’s keeping its low drawdown profile, it’s not gain anything this year. Of slightly in July, it is still modestly down for the year. Buying a pullback doesn’t work when stocks don’t rally!
Futures Programs
Groups DF1: Daily Trend Programs for Futures
Futures allow both high leverage and true diversification. The larger portfolios, such as $1million, are diversified into both commodities and world index and interest rate markets, in addition to foreign exchange. Its performance is not expected to track the U.S. stock market and is a hedge in every sense because it is uncorrelated. As the portfolio becomes more diversified its returns are more stable.
The leverage available in futures markets allows us to manage the risk in the portfolio, something not possible to the same degree with stocks. This portfolio targets 14% volatility. Investors interested in lower leverage can simply scale down all positions equally in proportion to their volatility preference. Note that these portfolios do not trade Asian futures, which we believe are more difficult for U.S. investors to execute. The “US 250K” portfolio trades only U.S. futures.
Modest losses in July keeps the chart looking much the same. The smaller portfolio has been more volatile in both monthly and annual returns, while the larger portfolios have been quiet for the past few months.
Group DF2: Divergence Portfolio for Futures
I’m not sure why we keep maintaining this program, but it use to work! This month was mixed with the 500K account up 4% while the others were down over 5%. Modest losses for the year.
Blogs and Recent Publications
Perry’s books are all available on Amazon or through our website, www.kaufmansignals.com.
In person appearances:
- Perry will be giving a special 3-day learning seminar with Kevin Davey on-line September 25-26.
- He will also be a key speaker at the IFTA conference in London on October 9-10.
- And a key speaker at the SIAT conference in Italy in September 19.
A full schedule!
June-July 2026
Given the rallies in Silver and Crude, Perry published “Exiting the Trade: How To Avoid Being The Greater Fool.” Sometimes exiting sooner is the best choice. Read the article in the July issue of Technical Analysis of Stocks & Commodities
May 2026
Perry’s article “What We Can Learn From Drawdowns” was published in Spain,
April 2026
A new article, “The Crack Spread” in Technical Analysis of Stocks & Commodities, for those interested in trading crude and its products.
February 2026 / March 2026
An interview with Tim Slater, one of the movers in technical analysis, written by Barbara Diamond. We don’t give enough credit to those that formed the industry.
December 2025 / January 2026
The January issue of Technical Analysis of Stocks & Commodities has Perry’s latest article, “Smoothing the Data.” He looks at a wide variety of smoothing techniques and finds that the moving average is not the best!
October 2025
An article in Technical Analysis of Stocks & Commodities (the November issue) on “Low-Priced Stocks: A Golden Opportunity or an Unreasonable Risk.” You can take a guess or read the article!
As mentioned in the Close-Up, this was a follow-up on the article published in Seeking Alpha on October 25th, “How To Hedge the U.S. Dollar: Gold, Bitcoin, or Whatever?” This version included some portfolio allocations, which should help.
September 2025
No articles in September, although Perry has committed to being the Keynote Speaker at the Society of Technical Analysts (STA) when it hosts the IFTA conference in October 2026 (not this year!)
August 2025
The September issue of Technical Analysis of Stocks & Commodities has Perry’s article “Using the Elusive Volume Confirmation.” While volume has been an important component of price movement, Perry takes a look at how useful it has been.
July 2025
This month (the August issue) there is an article on “Explaining FX Carry (In Detail).” The Carry program has had years of profits followed by years of losses, yet it is a very important part of institutional trading. This article shows how it is actually done.
Perry has been asked to be the Keynote speaker at the IFTA Conference in London in 2026 (not this year!). Of course he will accept. Plan to be there!
Perry also addressed a Spanish class where they are building algorithmic strategies. Called ROBOTRADER, it in ETSIT-UPM (Escuela Técnica Superior Ingenieros Telecomunicación- Universidad Politécnica Madrid). The presentation is about Diversfication (in English) and available on youtube.
Older Items of Interest
Perry did a studio interview with Jeff Baccaccio (“Rfactory”) in London in March 2025. It is a fine production and a good interview. He has put it on youtube. I hope you enjoy it.
YouTube: https://youtu.be/jmR359jHYBQ?si=IHQ5bVLijGFM19qF
Perry was interviewed on June 27, 2024 by Simon Mansell and Richard Brennan at QuantiveAlpha (Queensland, Australia), a website heavy into technical trading. It appears on their website.
On April 18th, 2023, Perry gave a webinar to the Society of Technical Analysts (London) on how to develop and test a successful trading system. Check their website for more details, https://www.technicalanalysts.com..
Perry’s webinar on risk, given to the U.K. Society of Technical Analysts, can be seen using the following link: https://vimeo.com/708691362/04c8fb70ea
For older articles please scan the websites for Technical Analysis of Stocks & Commodities, Modern Trader, Seeking Alpha, ProActive Advisor Magazine, and Forbes. You will also find recorded presentations given by Mr. Kaufman at BetterSystemTrader.com, TalkingTrading.com, FXCM.com, systemtrade.pl, the website for Alex Gerchik, Michael Covel’s website, TrendFollowing.com, and Talking Trading.com.
You can address any questions to perry@kaufmansignalsdaily.com.
© July 2026, Etna Publishing, LLC. All Rights Reserved.