6-days to go.
Thank-God.
THE FED (USA Today)
The FED said, Blah blah blah blah blah blah blah blah blah
blah data dependent blah blah blah blah blah blah…” Here’s what they really
said:
“The Fed, in its statement, said that the "case for
an increase in the federal funds rate has continued to strengthen but decided,
for the time being, to wait for some further evidence of continued progress
toward its objectives" of stronger economic growth and inflation rising
towards its 2% mandate.” Could you tell the difference? Story at…
ADP EMPLOYMENT (USA Today)
“ADP said businesses added 147,000 jobs last month,
below the 165,000 additions economists expected. They forecast the Labor
Department on Friday will record 175,000 new jobs in the public and private
sectors in the final employment report before the election.” Story at…
CRUDE INVENTORIES (OilPrice.com)
“This week’s American Petroleum Institute (API) reported a massive 9.3 million barrel build in
United States’ crude oil supplies – the largest increase since March of this
year.” Story at…
My cmt: CNBC reported that this was the largest inventory
build ever.
MARKETS TO DROP 5 TO 10% MORE - GUNDLACH (Reuters)
"We got the bearish signal," Gundlach said about the
S&P 500 dropping below 2,130 on Monday and the previous trading day.
"It is more noteworthy and reinforces the bear signal that the market is
down a lot today [Tuesday]. The dam is breaking, you can feel it."
Gundlach projects another 5 percent and 10 percent decline in the S&P 500,
which closed at 2,111.72 on Tuesday.” Story at…
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 was down 0.7% to 2098 on the
day.
-VIX rose about 4% to 19.32 near the close.
-The yield on the 10-year Treasury slipped to 1.80%.
The “Calm-Before-the-Storm” indicator (based on
statistical analysis of market action) remained bearish again today. Again, this indicator suggests there’s more
downside ahead. Unlike yesterday, Wednesday there was more late-day selling.
That has been going on for some time now. The Money Trend indicator and Sum of
16-Indicators were trending down today, too.
Bullish signs: Bollinger Bands and the Advance-Decline
ratio both signaled “oversold” and RSI was close to “oversold” as well. Tuesday
was another statistically significant down-day and, in about 60% of the time, the
next session is an up-day. Wednesday is the 9th-day out of the last
10 that have been down and there have been 13 down-days in the last month. Both are unusually high and they happen near
bottoms. Breadth is also hitting levels where correction bottoms occur. Still,
we have not seen a good buy signal so the pullback does not appear to be over.
Overall, it appears that we have further to fall.
Long-term, I’m fully invested at 50% in stocks (a
conservative-retiree allocation) – I remain “hold-my-nose” bullish.
TRADING PORTFOLIO
WEDNESDAY MARKET INTERNALS (NYSE DATA)
-10-day moving average of the percentage of stocks
advancing (NYSE): 39.5%. (44.2% yesterday.) A number below 50% is usually
BEARISH for the markets short-term.
-150-day moving average of advancing stocks: 52.4%. (A
value above 50% indicates a long-term, up-trend.)
-McClellan Oscillator: declined from -58 to -75
(percentage calculation method).
-New-highs minus new-lows: -81 (It was -53 yesterday.)
-10-day moving average of the change in spread: -16. In
other words, over the last 10-days, on average, the spread has decreased by 16
each day.
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).
LONG TERM INDICATOR
Wednesday the VIX indicator is negative. Price, 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 2016 in my long-term
accounts.
Remainder is 50% G-Fund. This is a conservative retiree allocation.
