I couldn’t agree more.
MARKET REPORT / ANALYSIS
-Monday the S&P 500 was up about 0.1% to 2583.
-VIX was up about 2% to 11.50.
-The yield on the 10-year Treasury rose to 2.407%.
Today was a weird day. Price was up for the S&P 500,
but only 45% of stocks advanced on the day; only 41% of volume was up; and new-lows
slightly outpaced new-highs.
Market Internals officially turned negative today. The
sum of 17-indicators continues to fall sharply.
I’m bearish short-term. At this point, it looks like we’ll
see some downside ahead.
I remain bullish longer-term. One wonders when this party
will end so I will worry if the numbers deteriorate, but for now 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…
Technology (XLK) was #1. It is interesting to see that
Energy stocks (XLE) have moved up strongly recently and are now #3.
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.
Intel (INTC) remained #1 today. I have owned Intel for
some time – I bought more Halloween, 10/31/2017. Avoid GE, IBM, Merck, United
Technologies, Verizon and Disney. Their 120-day moving averages are falling. *I
rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM
Page at…
SHORT-TERM TRADING PORTFOLIO - 2017 (Small-% of the
total portfolio)
LONG
I did take a short-term VXX position on 27 Oct very near
the close. This violates the rules below, but I am eternally hopeful. I am still holding this position.
My shorting rule is as follows:
-“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
MONDAY MARKET INTERNALS (NYSE DATA)
Market Internals switched
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).
LONG TERM INDICATOR
Monday, Sentiment,
Price, VIX & Volume indicators were neutral. With VIX recently below 10
for a couple of days in May, June, July, August, September, October and now
November, 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) 24 March
2017 in my long-term accounts, based on short-term indicators. The remainder
is 50% G-Fund (Government securities). This is a conservative retiree
allocation, but I consider it fully invested for my situation.
The previous signal was a BUY on 2 June and the last
actionable signal was a BUY (from a prior sell) on 15 November 2016.
