Wall Street at 5-month high - Bought SPDR Select Sector Fund - Industrials (XLI)

Stocks climbed to a five-month high on Tuesday, led by materials stocks after an upbeat forecast by aluminum company Alcoa and strong gains in bank shares.
The U.S. equity market continued its recent divergence from the woes of the euro zone. Recent economic reports and optimism about the U.S. earnings season have pushed stocks higher in the start of the new year, with the benchmark S&P 500 rising in five of six sessions.

The Dow Jones industrial average .DJI gained 69.78 points, or 0.56 percent, to 12,462.47. The Standard & Poor's 500 Index .SPX rose 11.38 points, or 0.89 percent, to 1,292.08. The Nasdaq Composite Index .IXIC climbed 25.94 points, or 0.97 percent, to 2,702.50.

The Dow and S&P 500 hit their highest intraday levels in five months. The S&P 500 close above 1,285.09 is the highest since the end of July and marked a breach of technical resistance, which could spur further gains.

Volume was solid, with about 7.02 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, above the daily average of 6.7 billion. Advancing stocks outnumbered declining ones on the NYSE by 2,305 to 687, while on the Nasdaq, advancers beat decliners 1,833 to 699. (commentary & picture courtesy of Reuters)

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The RSI portfolio turned in a good gain of +0.57% today. Somewhat under the 0.89% gain of the S&P500. I’ll take that, considering the large number of risk-off, income generating positions in the portfolio.

Recently RSI picked SPDR Select Sector Fund - Industrials (XLI) which I have been monitoring. Today I purchased it for the RSI portfolio. I have been trying to ease into more risk-on positions. RSI has been picking more of these funds, so I’m following suit.

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After the close RSI picked an energy fund:

• Buy 1032 shares ELEMENTS Rogers Intl Commodity Energy ETN (RJN); Volatility = 5.57%

My concerns is that it trades, on average, a bit under 100,000 shares per day. Not quite thin, but not in high demand. Also, as an ETN it represents the value of a basket of 6 energy commodity futures contracts, so it doesn’t hold the physical commodity. This is somewhat risky. However, if the economy turns around, international energy futures should do well.

This is a pick that might be worth your consideration, but use caution.