“New-home sales picked up in September, but hefty
downward revisions to sales in earlier months point to a market still
struggling for momentum. Sales ran at a seasonally adjusted annual rate of
593,000, the Commerce Department said Wednesday. That was 3.1% higher than
August’s figures…” Story at…
CRUDE INVENTORIES (DailyFx)
“Crude oil prices fell nearly 1 percent after the
American Petroleum Institute reported that inventories increased by 4.8 million
barrels in the previous week. This announcement marks the largest increase in
stockpiles since December of 2015…” Stpry at….
BULL OR BEAR (Real Investment Advice)
“I do think there is enough of a bullish case remaining
to warrant some equity risk on a very short-term basis. However, the
longer-term dynamics are clearly bearish. When those negative price
dynamics are combined with the fundamental and economic backdrop,
the “risk” of having excessive exposure to the markets greatly
outweighs the potential “reward. “ – Lance Roberts. Commentary at…
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 dropped about 0.2% to 2139.
-VIX rose about 6% to 14.24 at the close.
-The yield on the 10-year Treasury rose to 1.79%.
The “Calm-Before-the-Storm” indicator (based on
statistical analysis of market action) is still suggesting a big drop is coming,
but when I examine other indicators, it seems slightly more likely that the
“calm-before-the-storm” indicator is giving a false signal. As noted in
previous blog posts, I have not taken a position in VXX. I noted previously
that “…Another VXX trade may be possible…”
It still “may be” that a better VXX setup is coming; it
just doesn’t look like it is here yet, at least by my methodology. Had I taken
a VXX position the first time the indicator flashed sell I would be down about
4% as of Wednesday.
The S&P 500 is about 2.3% off its all-time high so
the markets really haven’t moved much since mid-August.
Short-term indicators remain mixed so I have not taken a
Trading Position.
Long-term, I’m fully invested at 50% in stocks (a conservative-retiree
allocation) – I’m hold-my-nose bullish.
TRADING PORTFOLIO
WEDNESDAY MARKET INTERNALS (NYSE DATA)
-10-day moving average of the percentage of stocks
advancing (NYSE): 49.9%. (51.5% yesterday.) A number below 50% is usually BEARISH
for the markets short-term.
-150-day moving average of advancing stocks: 53.3%. (A
value above 50% indicates a long-term, up-trend.)
-McClellan Oscillator: declined from -7 to -21 (percentage
calculation method).
-New-highs minus new-lows: 0 (It was 40 Tuesday.)
-10-day moving average of the change in spread: 0. In
other words, over the last 10-days, on average, the spread has remained
unchanged each day.
Market Internals declined
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).
LONG TERM INDICATOR
Wednesday the Price, VIX, Volume, & Sentiment
indicators were neutral. Overall the long-term indicator remained HOLD.
MY INVESTED STOCK POSITION:
TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATION
I increased stock allocation to 50% stocks in
the S&P 500 Index fund (C-Fund) Friday, 23 Sep in my long-term accounts
based on a number of indicators. Remainder is 50% G-Fund. This is a
conservative retiree allocation.
