Wednesday, June 20, 2018

Existing Home Sales … Crude Inventories … Stock Market Analysis… ETF Trading … Dow 30 Ranking

HOME SALES (Washington Post)
“U.S. existing home sales slipped 0.4 percent in May, as the prolonged shortage of properties on the market is deterring home-buying.” Story at…
 
CRUDE INVENTORIES (OilPrice.com)
“Crude oil prices remained relatively stable after the Energy Information Administration reported a draw of 5.9 million barrels in U.S. crude oil inventories for the week to June 15.” Story at…
 
MARKET REPORT / ANALYSIS         
-Wednesday the S&P 500 was up about 0.2% to 2767.
-VIX dropped about 4% to 12.79. 
-The yield on the 10-year Treasury rose to 2.933%.
 
115 stocks made new-highs on the NYSE while only 38 stocks made new-lows.  That’s a nice switch from yesterday’s numbers.  New-high/new-low data is the aircraft carrier of indicators – it usually takes a long time to turn around. The turn back to a positive spread today is a nice sign.
 
My daily sum of 17 Indicators improved slightly from -6 to -5, while the 10-day smoothed version dropped from +14 to +4. A number above zero shows most indicators are bullish. The improvement on the day was small, but I'll take an optimistic stance and say the sum of indicators is Neutral.
 
Breadth, measured as the % of stocks on the NYSE that advanced over the last 10-days, has dropped to 47.1%. (More stocks have been going down over the last 2-weeks than have been going up.) This is generally bearish and the market internals I track remain negative.
 
RSI is an elevated (but neutral) 71; the Bollinger Band indicator is neutral.
 
My longer-term indicator system improved to bullish; I remain a bull.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
WEDNESDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained Negative on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting).
 

18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Wednesday, the Price & VIX indicators were positive; the Sentiment & Volume indicators were neutral. Overall this is a BULLISH indication.

Tuesday, June 19, 2018

Housing Starts … Trade War … Stock Market Analysis … ETF Trading … Dow 30 Ranking

HOUSING (Reuters)
“U.S. homebuilding surged to near an 11-year high in May amid an acceleration in both single-family and multi-family home construction, but a second straight monthly drop in permits suggested housing market activity would remain moderate.” Story at…
 
TRADE WAR – WHERE ARE WE HEADED? (Real Investment Advice)
“With the market weakness yesterday [Monday], we are holding off adding to our equity “long positions” until we see where the market finds support. Currently, there is a cluster of support coalescing at the 100-dma. The 50-dma is set to cross back above the 100-dma this week, and the downtrend line from the March highs also resides at that juncture… we suspect the market will be sufficiently oversold enough for a reflexive bounce by the end of the month. Again...the most probable outcome currently remains a continued sideways and choppy market.” – Lance Roberts. Commentary at…
 
MARKET REPORT / ANALYSIS         
-Tuesday the S&P 500 was down about 0.4% to 2763.
-VIX was up about 8% to 13.35. 
-The yield on the 10-year Treasury slipped to 2.899%.
 
The S&P 500 dipped to its lower trend line (2740ish) this morning and bounced up from there. The day's “rally” continued for the rest of the day. Closing Tick (sum of last trades of the day) was a mildly bullish +39 and late-day, price-action was also mildly bullish. The markets may dip to the trendline again, or even test the 50-dMA (currently 2709), but so far there doesn’t seem to be any signs of panic over Trade Wars or other news, so I am cautiously bullish in the near term.
 
While S&P 500 closed at 3.9% above its 200-dMA, the NYSE Composite is only 0.2% above its 200-dMA. Perhaps the Comp is suggesting selling won’t last too much longer.  
 
My daily sum of 17 Indicators declined from -3 to -6, while the 10-day smoothed version dropped from +24 to +14. A number above zero shows most indicators are bullish, but the trend has been down and overall that's a bearish sign.
 
Breadth, measured as the % of stocks on the NYSE that advanced over the last 10-days, has dropped to 47.5%. (More stocks have been going down over the last 2-weeks than have been going up.) The market internals I track are now negative.
 
My longer-term indicator system dropped to neutral.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
TUESDAY MARKET INTERNALS (NYSE DATA)
Market Internals declined to Negative on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting).
 
 
18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Tuesday, the Price indicator was positive; the Sentiment, VIX & Volume indicators were neutral. Overall this is a NEUTRAL indication.

Monday, June 18, 2018

NAHB Housing Index … Stock Market Analysis… ETF Trading … Dow 30 Ranking

NAHB HOUSING INDEX (forexlive)
“The NAHB housing market index for June came in at 68 versus 70 expected. That was also lower than the 70 in May.” Story at…
 
MARKET REPORT / ANALYSIS         
-Monday the S&P 500 slipped about 0.2% to 2774.
-VIX was up about 3% to 12.31. 
-The yield on the 10-year Treasury slipped to 2.897%.
 
My daily sum of 17 Indicators declined slightly from -2 to -3, while the 10-day smoothed version dropped from +33 to +24. A number above zero shows most indicators are bullish. Overall not much change from last week, but as noted last week, a number of the indicators have stalled and appear to be rolling over to the downside.
 
Breadth, measured as the % of stocks on the NYSE that advanced over the last 10-days, has dropped below 50% and now sits at 49.1%. (More stocks have been going down over the last 2-weeks than have been going up.) The market internals I track would be negative except that advancing volume is still headed up.
 
RSI is surprisingly elevated at 71 (I was surprised that RSI was up today on a down day for the S&P 500). 80 is overbought. Smart Money is headed down. When we compared the Internals vs the S&P 500 price, price is too far ahead of Internals and is close to signaling a top. New-high/new-low data is generally bearish, but the graph of new-highs continues higher and that’s a bullish sign for the time being.
 
My longer-term indicator system remains bullish and I remain a bull. Short-term, the deterioration in indicators is worrisome. Indictors are still declining, but it's not yet time to panic.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
MONDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained Neutral on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting). 
 
18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Monday, the Price & VIX indicators were positive; the Sentiment & Volume indicators were neutral. Overall this is a BULLISH indication.

Friday, June 15, 2018

Empire Manufacturing … Industrial Production … Consumer Sentiment … Stock Market Analysis… ETF Trading … Dow 30 Ranking

EMPIRE MANUFACTURING (MarketWatch)
“The Empire State manufacturing survey rose 4.9 points in June to a reading of 25, the highest since October, the New York Fed said Friday.” Story at…
 
INDUSTRIAL PRODUCTION (MarketWatch)
"Industrial production fell in May for the first time in four months, but the drop-off was largely the result of a major fire at an auto-parts supplier for Ford F, -0.08%trucks instead any weakness in the U.S. economy.” Story at…
 
CONSUMER SENTIMENT (CNBC)
“The index rose to its highest level since hitting 101.4 in March.” Story at…
 
MARKET REPORT / ANALYSIS         
-Friday the S&P 500 slipped about 0.1% to 2780.
-VIX was dropped about 1% to 11.98. 
-The yield on the 10-year Treasury slipped to 2.920%.
 
My daily sum of 17 Indicators declined slightly from -1 to -2, while the 10-day smoothed version dropped from +39 to +33. A number above zero shows most indicators are bullish. Overall not much change from yesterday, but a number of the indicators have stalled and appear to be rolling over to the downside.
 
My longer-term indicator system remains bullish and I remain a bull. Short-term, the deterioration in indicators is worrisome and we’ll take a closer look at indicators next week.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
THURSDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained Neutral on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting). 
 
18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Friday, the Price & VIX indicators were positive; the Sentiment & Volume indicators were neutral. Overall this is a BULLISH indication.

Thursday, June 14, 2018

Jobless Claims … Retail Sales … Stock Market Analysis… ETF Trading … Dow 30 Ranking

JOBLESS CLAIMS (MarketWatch)
“Initial jobless claims dropped by 4,000 to 218,000 in the seven days ended June 9… The U.S. jobs market hasn’t been this good in decades.” Story at…
 
RETAIL SALES (LATimes)
“U.S. retail sales rose in May by the most in six months, exceeding forecasts and bolstering expectations for an acceleration in economic growth this quarter.” Story at…
 
MARKET REPORT / ANALYSIS         
-Thursday the S&P 500 rose about 0.3% to 2782.
-VIX was dropped about 6% to 12.12. 
-The yield on the 10-year Treasury slipped to 2.926%.
 
My daily sum of 17 Indicators improved slightly from -3 to -1, while the 10-day smoothed version dropped from +40 to +39. A number above zero shows most indicators are bullish. Overall not much change from yesterday, but a number of the indicators have stalled and one wonders whether they will rollover to the downside. I don’t know at this point.
 
It’s been a long day so I’ll leave it there.  
 
My longer-term indicator system remains bullish and I remain a bull.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
THURSDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained Neutral on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting). 
 
18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Thursday, the Price indicator was positive; the Sentiment, Volume, and VIX indicators were neutral. Overall this is a BULLISH indication.

Wednesday, June 13, 2018

FOMC Rate Decision … Producer Price Index … Crude Inventories … Stock Market Analysis… ETF Trading … Dow 30 Ranking

FOMC RATE DECISION (MarketWatch)
“U.S. stock benchmarks ended near session lows Wednesday as the Federal Reserve completed its second increase to benchmark interest rates in 2018, as expected, but signaled a slightly more aggressive plan to tighten monetary policy this year than had previously been projected.” Story at…
 
PRODUCER PRICE INDEX (Reuters)
“U.S. producer prices increased more than expected in May, leading to the biggest annual gain in nearly 6-1/2 years, the latest sign of a gradual building up of inflation pressures… The producer price index for final demand rose 0.5 percent last month, boosted by a surge in gasoline prices and continued gains in the cost of services…” Story at…
 
CRUDE INVENTORIES (OilPrice.com)
“The Energy Information Administration reported a large crude oil draw of 4.1 million barrels for the week to June 8, after a 2.1-million-barrel increase a week earlier.” Story at…
 
MARKET REPORT / ANALYSIS         
-Wednesday the S&P 500 dipped about 0.4% to 2776.
-VIX was up about 5% to 12.94. 
-The yield on the 10-year Treasury rose to 2.975%.
 
Sentiment: I measure Sentiment as %-Bulls (Bulls/{bulls+bears}) based on the amounts invested in Rydex/Guggenheim long/short mutual funds. I then compare those values on a standard deviation basis to extremes seen in the dot.com era. We hit values as high as that on 1 Feb of this year near the beginning of the correction.
But just because sentiment is high, it does not guarantee a crash, as we observed recently. Importantly, Sentiment has fallen throughout this correction process and reached 76%-bulls Tuesday.  That’s a high number, but a far cry from the recent high of 91%-bulls in February. The important point here is that the recent drop in the %-bulls is a good indication that this rally can keep going...but there were troubling signs today.
 
My daily sum of 17 Indicators crashed from +8 to -3, while the 10-day smoothed version dropped from +48 to +40. A number above zero shows most indicators are bullish. This was a big drop in the indicators in one day so we’ll have to pay attention to see if Wednesday’s weakness continues.  The loss today was all late-day action, the so called Smart Money. I don’t like to bet against the Smart Money so we’ll watch and see where this goes.
 
It’s been a long day so I’ll leave it there.  
 
My longer-term indicator system remains bullish and I remain a bull.
 
MOMENTUM ANALYSIS:  
TODAY’S RANKING OF  15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.  While momentum isn’t stock performance per se, momentum is closely related to stock performance. For example, over the 4-months from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed the S&P 500 by nearly 20%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
The top ranked stock receives 100%. The rest are then ranked based on their momentum relative to the leading stock. (On 5 Apr 2018 I corrected a coding/graphing error that had consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
WEDNESDAY MARKET INTERNALS (NYSE DATA)
Market Internals declines to Neutral on the market.
Market Internals are a decent trend-following analysis of current market action but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2014, using these internals alone would have made a 9% return vs. 13% for the S&P 500 (in on Positive, out on Negative – no shorting). 
18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. (It has since turned Neutral.) For me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless I am in full defense mode.
 
On 10 May 2018 I added stock positions to increase Stock investments to 58% based on more evidence that the correction is over. This is high for me given that we are late in this cycle (and as a retiree), but it indicates my bullishness after the correction. I’ll sell these new positions quickly if the market turns down.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Wednesday, only the Price indicator was positive; the Sentiment, Volume, and VIX indicators were neutral. Overall this is a BULLISH indication, but much less so than just a day ago.