“Americans got out and spent more in the spring, nursing
the U.S. economy back to health after a feeble start to the year. The official
scorecard for economy, known as gross domestic product, grew at an annual rate
of 2.6% in the second quarter…” Story at…
MICHIGAN SENTIMENT (CNBC)
“Consumer confidence remained largely unchanged for the
month, a survey of consumers by The University of Michigan revealed on Friday.
But this means Americans appear the most optimistic about the current economic
situation in U.S. than they have in 12 years.” Story at…
MARKET REPORT / ANALYSIS
-Friday the S&P 500 was down about 0.1% to 2472.
-VIX was up about 2% to 10.29.
-The yield on the 10-year Treasury slipped to 2.292%.
RSI is still screaming sell right now. New-highs are moving down on a smoothed
basis; Money Trend is headed down, but is still above zero (That suggests there
is still buying, but the up-trend is slowing. New-high/new-low data is also
headed down.); the daily sum of 17-indicators is falling and below zero, so
most indicators are now slipping.
Late day action was reasonably bullish since the S&P
500 was up late. This probably means the
Pros haven’t bought into a correction any time soon. I said yesterday, “In the
short-term, it’s going to take another negative signal to get us worried about
a pullback.” Now, we’ve got more indicators headed down so I’m worried, but let’s
not panic yet.
The call is NEUTRAL on a short-term basis. Longer-term,
I’m cautiously bullish; I will worry more in late-summer and into early fall,
but I remain fully invested.
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%.
*For additional background on the ETF ranking system see
NTSM Page at…
Today, Biotech (IBB) ETF remains #1. I would avoid XLE;
its 120-day moving average is still falling.
SHORT-TERM TRADING PORTFOLIO - 2017 (Small-% of the
total portfolio)
I take a portion of my cash and apply it strategically to
improve returns in cash. My short-term trading has never been about
get-rich-quick.
I haven’t been doing much in the trading portfolio –
too busy to worry about it; but the call is now NEUTRAL as noted above.
-“In a bull market, you can only be long or neutral.”
– D. Gartman
-“The best policy is to avoid shorting unless a major
bear market is underway and downside momentum has been thoroughly established.
Even then, your timing must sometimes be perfect. In a bull market the trend is
truly your friend, and trading against the grain is usually a fool's
errand.” – Clif Droke.
-“Commandment #1: “Thou Shall Not Trade Against the Trend.” - James P. Arthur Huprich
FRIDAY MARKET INTERNALS (NYSE DATA)
Market Internals
remained neutral on the market; the 10-day advancing volume is now falling.
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
Friday, Price is positive; Sentiment, Volume, & VIX
indicators were neutral. (With VIX
recently below 10 for a couple of days (May and June, and now July), VIX may be
prone to incorrect signals. Usually, a rising VIX is a bad market sign; now it
may move up, but that might just signal normalization of VIX, i.e., VIX and the
Index may both rise. As an indicator, VIX is out of the picture for a while.)
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,
24 March 2017 in my long-term accounts, based on short-term indicators.
Remainder is 50% G-Fund (Government securities). This is a conservative retiree
allocation, but I consider it fully invested for my situation.
