PILOSI TO ANNOUNCE IMPEACHMENT INQUIRY (Washington Post)
September 24, 2019, 1:01 p.m. EDT
“House Speaker Nancy Pelosi plans to announce a formal
impeachment inquiry into President Trump, a dramatic turnaround by the
Democratic leader that sets up a constitutional and political clash pitting the
Congress against the nation’s chief executive.” Story at…
My cmt: During the
Clinton years, impeachment was not particularly good for the stock market.
CONSUMER CONFIDENCE (Reuters)
“U.S. consumer confidence fell by the most in nine months
in September, far more than expected, as Americans’ economic outlooks darkened
in the face of the U.S.-China trade war, according to a private sector report
released on Tuesday. The Conference Board, an industry group, said its index of
consumer attitudes fell to 125.1…” Story at…
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 was down about 0.9% to 2966.
-VIX rose about 14% to 17.05.
-The yield on the 10-year Treasury dipped to 1.651.
Changes from yesterday? On the bad side…
-Today was a Distribution Day, number 6 in the last 25
days. That’s considered very bearish.
-VIX rose fast enough to give a bear signal. VIX is one
of my best indicators.
On the good side…
-RSI switched to Neutral.
-Today was a statistically-significant down-day. That
just means that the price-volume move exceeded my statistical parameters.
Statistics show that a statistically significant down-day is followed by an
up-day about 60% of the time. Big down-days can signal panic selling; but more
often than not, they signal an end to short-term selling. Now, we can’t be
sure. I think the good news is that it
doesn’t look like we’re going to see a big correction.
If a correction does begin, the 50-dMa is 2950. That’s an important point if we are to avoid
a correction. The 100-dMA is about 2922; that was around the S&P 500 high
in 2018. That’s about where we might
expect a pullback to end if we do get a downturn.
As of today, the
S&P 500 is 1.4% below its recent high of 3011 on 24 Sept.
My daily sum of 20 Indicators improved from -4 to
-3 (a positive number is bullish; negatives are bearish) while the 10-day
smoothed version that negates the daily fluctuations slipped from +57 to
+42. (These numbers sometimes change after I post the blog based on data that
comes in late.)
I probably won’t make any drastic investment changes unless
I get a sell-signal from the long-term indicator. I may take profits in a
couple of trading positions.
A reminder: Most of the indicators I report on daily are
short-term.
I remain bullish, at least in the sense that this doesn’t
look like a major correction. The problem may be the “impeachment”, if it goes
forward.
TOP / BOTTOM INDICATOR SCALE OF 1 TO 10 (Zero is a
neutral reading.)
Today’s Reading: 0
Most Recent Day with a value other than Zero: -1 on 23
September.
(1) +10 Max Bullish / -10 Max Bearish)
(2) -4 or below is a Sell sign. +4 or better is a Buy
Sign.
MOMENTUM ANALYSIS:
TODAY’S RANKING OF
15 ETFs (Ranked Daily)
*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.
*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
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).
Using the Short-term indicator in 2018 in SPY would have
made a 5% gain instead of a 6% loss for buy-and-hold. The methodology was Buy
on a POSITIVE indication and Sell on a NEGATIVE indication and stay out until
the next POSITIVE indication. The back-test included 13-buys and 13-sells, or a
trade every 2-weeks on average.
My current stock allocation is about 55% invested in
stocks as of 20 August 2019. This is a conservative balanced position
appropriate for a retiree.
INTERMEDIATE / LONG-TERM INDICATOR
Tuesday, the PRICE indicator
was positive; VOLUME and SENTIMENT and Indicators were neutral. VIX was negative.
Overall, the Long-Term Indicator remained HOLD, but is now tilting Bearish.
