Monday, April 30, 2018

Personal Spending … PCE Prices… Chicago PMI … Stock Market Earnings … Budget Blame … Stock Market Analysis… ETF Trading … Dow 30 Ranking

PERSONAL SPENDING (Reuters)
“U.S. personal income rose just 0.3 percent in March, compared with expectations of 0.4 percent. On the consumption side, personal spending in February was revised lower to a rise of 0.3 percent, instead of the previously reported 0.4 percent increase.” Story at…
 
PCE PRICES (Reuters)
“U.S. consumer prices accelerated in the year to March, with a measure of underlying inflation surging to near the Federal Reserve’s 2 percent target as weak readings from last year dropped out of the calculation.” Story at…
 
CHICAGO PMI (MarketWatch)
“Chicago PMI inched up in April to a reading of 57.6. The increase only slightly retraced the big drop in March, when the index fell to 57.4 from 61.9…” Story at…
 
EARNINGS INSIGHT EXCERPT (FactSet)
“To date, 53% of the companies in the S&P 500 have reported actual results for Q1 2018. In terms of earnings, more companies are reporting actual EPS above estimates (79%) compared to the five-year average. If 79% is the final percentage for the quarter, it will mark the highest percentage of S&P 500 companies reporting actual EPS above estimates since FactSet began tracking this metric in Q3 2008…more companies (74%) are reporting actual sales above estimates compared to the five-year average. In aggregate, companies are reporting sales that are 1.7% above estimates, which is also above the five-year average. If 1.7% is the final percentage for the quarter, it will mark the largest revenue surprise percentage since FactSet began tracking this metric in Q3 2008.” For full report see FACTSET at…
If this isn’t enough to get investors back in the mood to buy stocks, we’d better be ready to bail out of this market if selling picks up.  In my opinion, nothing is more bearish than to see the market falling on good earnings news.
 
BUDGET BLAME (Washington Times)
“While tax cuts take the budget blame, spending does the debt damage. Proponents of big government spending are happy to stoke the latest story in the narrative that America is under-taxed. However, quick comparison of federal revenues and outlays versus their historic averages shows clearly the fault lies with Washington’s spending, not America’s paying.” Story at…
 
MARKET REPORT / ANALYSIS         
-Monday the S&P 500 dropped about 0.8% to 2648.
-VIX rose about 3% to 15.93. 
-The yield on the 10-year Treasury slipped a bit to 2.955%.
 
Regarding Friday’s Blog and the chart of the S&P 500 showing a “symmetrical wedge” pattern, that pattern remains in play. Today the Index dropped to its lower trend line in that wedge. A break lower will be seen as bearish; a break above the upper trend line (the 50-dMA at 2687) would be very bullish. In both cases the break must be confirmed by 2-closes above or below the line in consideration.
 
The dramatic drop in VIX over the last 3-months suggests to me that the correction has ended and markets should rise. News can trump technical data and today we had news from Israel stating that Iran had cheated on its nuclear program and that seems to have caused a drop in the markets after 2PM.   
 
My daily sum of 17 Indicators dropped from +2 to -6; the 10-day smoothed version dropped from -4 to -14. 
 
My plan ahead remains: If the S&P 500 drops to its prior low of 2581 and there is an unsuccessful retest, I will probably cut stock holdings again. If we see a successful test I’ll be adding to stocks. I am expecting a break to the upside, but I have been wrong in the past.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
MONDAY MARKET INTERNALS (NYSE DATA)
Market Internals switched from Positive 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). 
 
Thursday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio. This is not the time to take extra risk, so you may want to have less in stocks than normal.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Monday, VIX, Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication.

Friday, April 27, 2018

GDP … Michigan Sentiment … INTEL Soars … Stock Market Analysis… Correction Update… ETF Trading … Dow 30 Ranking

GDP (Business Insider)
“The US economy grew faster than expected in the first quarter, according to the Commerce Department's initial estimate of gross domestic product released Friday.
GDP, the value of all goods and services produced within the US, increased at an annualized rate of 2.3%, down from 2.9% in the fourth quarter.” Story at…
 
MICHIGAN SENTIMENT (MarketWatch)
“The final reading of the University of Michigan consumer sentiment index was 98.8, up from the initial reading of 97.8 but still below March’s level of 101.4.
Current economic conditions fell sharply, though expectations were basically unchanged.” Story at…
 
INTEL SOARS (Reuters)
“Intel Corp (INTC.O) beat earnings expectations for the first quarter and raised its full-year revenue and profit forecasts on Thursday, driven by the biggest-ever quarterly jump in its data centre business and small-but-steady growth in its personal computer business. Shares of the Santa Clara, California-based chipmaker rose 5.4 percent to $55.95 in after-market trading…” Story at 
Regular readers know we have been Intel fans for some time. It’s up 10.9% over the last 2-months and that is during a correction. Facebook is down 2% over the same period.
 
MARKET REPORT / ANALYSIS         
-Friday the S&P 500 rose about 0.1% to 2670.
-VIX was Down about 5% to 15.41. 
-The yield on the 10-year Treasury slipped to 2.959%.
 
The chart of the S&P 500 showing a “symmetrical wedge” pattern indicated by the blue lines in the following chart. This is a neutral pattern that usually (9-times out of 10) breaks out on higher volume in the direction of the “existing trend” according to Investopedia.
 
The trouble is that it’s hard to say whether the existing trend is up or down. The longer-term trend is down, but it has been up since 2 April. We need to see whether the Index will break above the upper trend line or fall below the lower trend-line.  If the Index can break above the upper trend line and stay there for 2 closes, it will “confirm” that the longer-term trend has turned to the upside.  A failure to break higher here will cause more selling.     
 
My daily sum of 17 Indicators improved from -5 to +2; the 10-day smoothed version improved from -6 to -4.  I don’t see any indicators giving very strong Buy or Sell signals right now.
 
As noted above, we’re still watching the upper trend line {50-day-moving-average (50-dMA)}. If it can break higher and stay there for 2-days I’ll feel better about my “correction over” call.
 
My plan ahead is: if the S&P 500 drops to its prior low of 2581 and there is an unsuccessful retest, I will probably cut stock holdings again. If we see a successful test I’ll be adding to stocks. I am expecting a break to the upside, but I have been wrong in the past.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
FRIDAY MARKET INTERNALS (NYSE DATA)
Market Internals improved to Positive 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). 
Thursday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio. This is not the time to take extra risk.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Friday, the VIX indicator was positive; Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication.

Thursday, April 26, 2018

Durable Goods Orders … Jobless Claims … Stock Market Analysis … Correction Update… ETF Trading … Dow 30 Ranking

DURABLE GOODS ORDERS (MarketWatch)
“Orders for long-lasting or “durable” goods jumped 2.6% in March, riding a big increase in contracts for Boeing planes. Yet orders were flat minus transportation and business investment fell for the third time in four months.” Story at…
 
JOBLESS CLAIMS (Bloomberg)
“U.S. filings for unemployment benefits plunged to the lowest level since 1969, mainly reflecting the return of educational service workers in New York state, figures showed Thursday.” Story at…
 
MARKET REPORT / ANALYSIS         
-Thursday the S&P 500 rose about 1% to 2667.
-VIX was Down about 9% to 16.24. 
-The yield on the 10-year Treasury slipped to 2.981%.
 
Late day action was down today and closing Tick (sum of last day trades) was -82. It’s impossible to know whether the late-day selling was simply profit taking by traders or a real turning point, i.e. a return to selling. The day was a statistically-significant up-day. That just means that the price-volume move up exceeded statistical parameters that I track. The stats show that about 60% of the time a statistically significant move up will be followed by a down-day the next day, but not always. The big move today could be the sign that investors are beginning to feel like the earnings are good enough to forget the correction. Statistically-significant days seem to clump at Tops (when confusion leads to a series of up and down days) and at Bottoms as buyers jump in.  We’ll need to see some upward follow-through to conclude investors are ready to buy with conviction. It’s not that I am particularly bearish now, I think we’ve seen the bottom, but apparently other investors have not agreed with me so far.
 
My daily sum of 17 Indicators improved from -6 to -5; the 10-day smoothed version dipped from +3 to -6, so it’s a mixed bag.  I don’t see any indicators giving very strong Buy or Sell signals right now.
 
We’re still watching 2700 as a point that would suggest a change in trend on the charts if the Index can break above that level. Actually, this is very close to the 50-day-moving-average (50-dMA) so we might just say we need to break above the 50-day and stay there for 2-days to feel better about my “correction over” call.
 
My plan ahead is: if there is an unsuccessful retest of prior lows, I will probably cut stock holdings again. If we see a successful test I’ll be adding to stocks. I am expecting a break to the upside, but I have been wrong in the past.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
THURSDAY MARKET INTERNALS (NYSE DATA)
Market Internals improved 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). 
 
Thursday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio. This is not the time to take extra risk.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Thursday, VIX, Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication.

Wednesday, April 25, 2018

Crude Inventories … Stock Market Analysis… Correction Update… ETF Trading … Dow 30 Ranking

CRUDE INVENTORIES (MarketWatch)
“Oil prices finished higher Wednesday in volatile trading, with concerns surrounding Iran and the risks to global crude supplies helping to erase earlier losses fed by an unexpected weekly rise in U.S. inventories.” Story at…
 
MARKET REPORT / ANALYSIS         
-Wednesday the S&P 500 rose about 0.2% to 2639.
-VIX was Down about 1% to 17.84. 
-The yield on the 10-year Treasury rose to 3.029%.
 
It was nice to see an up-day for a change, but declining stocks outpaced advancing stocks today with only 43% of stocks advancing on the day. Over the last 10-days only 49% of stocks have advanced and that’s not a sign of a good market. A related disconcerting sign is that Breadth is falling faster than the Index and that’s bearish.
 
-My daily sum of 17 Indicators declined from -5 to -6; the 10-day smoothed version dipped from +12 to +3. More bearish signs here.
 
As noted yesterday, the Chart remains mired in a downtrend and would need to break above about 2700 to make a run at changing the trend. The 150-dMA of advancing stocks remains above 50% (51.4%) so the current downtrend is short-term and not set in stone.
 
Late day action was mixed today.  The Index dropped after 3PM, but recovered some before the close and finished with a closing Tick of 218 (sum of last day trades). The 10-dMA of closing Tick was 196. In spite of the bearish way the market has been acting recently, there has been a fair amount of bullish late action in the market especially buying at the close.
 
Money Trend is has turned down.
 
Repeating: We need to consider the possibility that a retest of prior lows is likely and it may fail – if it does, I will probably cut stock holdings again. If we see a successful test I’ll be adding to stocks. I am expecting a break to the upside, but I have been wrong in the past
 
CORRECTION UPDATE
I think it is over - we'll see. The S&P 500 is currently 8.1% below its prior high and 2% above the low.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
WEDNESDAY MARKET INTERNALS (NYSE DATA)
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). 
 
Thursday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio. This is not the time to take extra risk.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Wednesday, VIX, Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication.

Tuesday, April 24, 2018

New Home sales … Consumer Confidence … Stock Market Earnings … Indicators to Watch … Stock Market Analysis… Correction Update… ETF Trading … Dow 30 Ranking

NEW HOME SALES (MarketWatch)
“Sales of newly constructed homes surged, and earlier estimates were revised up, painting a rosier picture of the housing market than many economists had expected.” Story at…
 
CONSUMER CONFIDENCE (Bloomberg)
“U.S. consumer confidence unexpectedly rose in April to the second-highest level since 2000 as Americans grew more upbeat about both current conditions and the economic outlook, according to figures Tuesday from the New York-based Conference Board.” Story at.
 
“Overall, confidence levels remain strong and suggest that the economy will continue expanding at a solid pace in the months ahead." – Lynn Franco, Director of Economic Indicators at The Conference Board. Press release at…
 
EARNINGS INSIGHT EXCERPT (Factset)
“-Earnings Scorecard: For Q1 2018 (with 17% of the companies in the S&P 500 reporting actual results for the quarter), 80% of S&P 500 companies have reported a positive EPS surprise and 72% have reported a positive sales surprise.
-Earnings Growth: For Q1 2018, the blended earnings growth rate for the S&P 500 is 18.3%. If 18.3% is the actual growth rate for the quarter, it will mark the highest earnings growth since Q1 2011 (19.5%).” Earnings Insight at…
 
5 INDICATORS TO WATCH – EXCERPT (Real Investment Advice)
“…we currently maintain short-term equity exposure to the markets as the bullish trend that begin in 2009 remains intact. However, we currently holding a higher level of cash than normal as a hedge against volatility and the lack of a positive risk/reward backdrop with which to deploy “risk” capital.” – Lance Roberts. Commentary at…
 
MARKET REPORT / ANALYSIS         
-Tuesday the S&P 500 dropped about 1.3% to 2635.
-VIX was Down about 10% to 18.02. 
-The yield on the 10-year Treasury rose to 2.994%.
 
This has been a tough correction to call since market internals at the retest of the low were not as robust as we would have liked, i.e. I didn’t quite get a Buy signal. As a result, we are forced to read other less trust worthy tea leaves to try and make sense of the market. Today, we note that an interesting trend: since the low on 23 March there have been 3 significant lows with drops of 2.3%, 2.2% and today’s 1.3%. Each has occurred with improved market internals compared to the low.  This suggests better conditions within the markets and tends to reinforce my call that the correction has seen its low. Of course, I didn’t see today’s drop coming, but the current high level of volatility brings big swings in price, so it’s too soon to panic.  
 
-My daily sum of 17 Indicators declined from -1 to -5; the 10-day smoothed version dipped from +21 to +12. We need to hope this bearish trend ends soon. Some of this is because of today’s big drop. It will worry me more if there is a negative follow thru on the day tomorrow, Wednesday.
 
The Chart remains mired in a downtrend and would need to break above about 2700 to make a run at changing the trend. The 150-dMA of advancing stocks remains above 50% (51.5%) so the current trend is short-term and not set in stone.
 
As noted several times, for the last 4 days Smart Money has been buying late in the day even on the down days. This indicator is positive and is moving solidly up – a bullish indication. Closing Tick has been positive too. It was +314 Today and the 10-dMA of closing Tick was 243. In spite of the bearish way the market has been acting recently, there has been a fair amount of bullish late action.
 
Money Trend is still positive, but its pace of rise is slipping.
 
I got back in at a fully invested position because of falling VIX.  VIX has been rising since then and is now giving a neutral signal. I think we need to consider the possibility that a retest of prior lows is likely and it may fail – if it does, I will probably cut stock holdings again. If we see a successful test I’ll be adding to stocks.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
TUESDAY MARKET INTERNALS (NYSE DATA)
Market Internals declined 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). 
 
Wednesday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio. This is not the time to take extra risk.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Tuesday, the VIX, Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication. VIX was giving a Buy signa just 3-days ago.

Monday, April 23, 2018

Home Sales … Stock Market Analysis… Correction Update… ETF Trading … Dow 30 Ranking

HOME SALES (Reuters)
“U.S. home sales increased for a second straight month in March amid a rebound in activity in the Northeast and Midwest regions, but a dearth of houses on the market and higher prices remain headwinds as the spring selling season kicks off… The National Association of Realtors said on Monday that existing home sales rose 1.1 percent…” Story at…
 
MARKET REPORT / ANALYSIS         
-Monday the S&P 500 was essentially unchanged at 2670.
-VIX was Down about 3% to 16.34. 
-The yield on the 10-year Treasury rose to 2.975%.
 
-My daily sum of 17 Indicators dipped from +1 to -1; the 10-day smoothed version dipped from +25 to +21. Not much change. Indicators are generally neutral as these numbers imply.
 
The S&P 500 remained below its lower trend line and the 50-dMA for a second day. We don’t like to see that. The Index is 3% above the correction low so if there is a retest, it won’t have far to fall.  Of course, we have to hope the retest, if it were to occur, would be a successful one.
 
Smart Money continues buying late in the day even on the down days, so this indicator has turned positive and is moving sharply up – a bullish indication. Closing Tick has been positive too. It was +201 today.
 
Money Trend remains sharply positive.
 
While some indicators are very bullish, overall, Indicators are only tipped slightly to the Bull side. I got back in at a fully invested position because of falling VIX.  Naturally, VIX has been rising since then.
 
There is still a chance the S&P 500 will retest the 8 Feb low, but I am following my long-term indicator. If the 10-year rates continue up, (now 2.975%) this could turn out to be a mistake. We’ll see.
 
MOMENTUM ANALYSIS IS STILL QUESTIONABLE BUT GETTING BETTER. As one can see below in both momentum charts, there are still a lot of issues in negative territory, i.e., they have weak upward momentum. That’s just an indication that the market is in correction mode and most stocks have been headed down.
 
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%. In 2017 Technology (XLK) was ranked in the top 3 Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.) XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see NTSM Page at…
 
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. (On 5 Apr 2018 I corrected a coding/graphing error that has consistently shown Nike incorrectly.)
*I rank the Dow 30 similarly to the ETF ranking system. For more details, see NTSM Page at…
 
MONDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained 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). 
 
Wednesday, 18 Apr 2018 I increased stock investments from 35% to 50% based on the Intermediate/Long-Term Indicator that turned positive on the 17th. For me, fully invested is a balanced 50% stock portfolio.
 
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term Indicator: Monday, the VIX, Volume, Price and Sentiment indicators were neutral. Overall this is a NEUTRAL indication.