The Morgan Stanley
Cyclical index was down 3.6% today (4x the drop in the S&P 500) so it looks
like investors got concerned about recession today. The MS Cyclical Index had been improving for
the last 2-weeks or so. Today it gave up
all of those gains. I watch this because
the cyclical stocks are more sensitive to recession concerns since those stocks
would be hurt more in a recession.
MARKET
Tuesday started well, but
gains didn’t hold. The S&P 500 was down 0.8% to 1341. The VIX rose 4% to 17.72. That’s a 9% rise in two days. Again, the rise in VIX is not a good sign.
The NTSM model has turned
around quickly on occasion from buy, to sell, to buy, so I am a little
concerned the NTSM system may signal a sell soon. While I don’t like frequent moves, because I
don’t want to trade the 401k, there is little choice if “the market” changes
its mind quickly. Also, no system is
perfect. So far it’s only a concern. As
I noted yesterday, the trend is still up.
Volume has been declining over the past few days as the market has
been going down so that is a relatively good sign too.
NTSM
The NTSM analysis is BUY again
today, Tuesday.
MY INVESTED POSITION
Based on the BUY signal
Friday, 6 July, I moved back into the market on 9 July and I now have a 50%
stock allocation. I am only 50% invested now because this looks like a high risk market. 
