I will be taking a break from writing the blog for
a bit. Today will be my last regular blog for the next month or so. I may post occasionally – we’ll see. I expect
to have the NTSM Blog up and running again in late November.
CRUDE OIL INVENTORIES (OilPrice.com)
“The American Petroleum Institute (API) has estimated a
crude oil inventory build of 4.45 million barrels for the week ending October
17—compared to analyst expectations of a 2.232-million-barrel build.”
Story at…
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 0.3% to 3005.
-VIX dipped about 3% to 14.01.
-The yield on the 10-year Treasury was little changed at
1.769.
My daily sum of 20 Indicators improved from +7 to
+9 (a positive number is bullish; negatives are bearish) while the 10-day
smoothed sum that negates the daily fluctuations rose from +26 to +41
(These numbers sometimes change after I post the blog based on data that comes
in late.) A reminder: Most of these indicators are short-term.
We’ve been watching late-day-action. Today, the market
was nearly straight up after 2:40 PM. That’s
bullish for the day, but the 10-day value is still neutral. Perhaps today’s big
jump will carry thru and we’ll see the Pros start buying more consistently.
As noted yesterday, Seasonality is bullish for the next
month. and I see no reason why the markets can’t keep moving up.
I remain bullish.
As noted, I’ll be taking a break from blogging so this
will be my last regularly scheduled blog for a while. All the best and I’ll be
back regularly posting in late November.
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: +2 on 3
October.
(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)
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.
*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 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).
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 60% invested in
stocks as of 7 Oct 2019 (up from 50%). This is a conservative balanced position
appropriate for a retiree. You may wish to have a higher or lower % invested in
stocks depending on your risk tolerance.
INTERMEDIATE / LONG-TERM INDICATOR
Wednesday, the VIX, PRICE and VOLUME
indicators were positive; the SENTIMENT Indicator was neutral. Overall, the
Long-Term Indicator remained BUY. The important BUY was the one we
issued 29 August; we reinforced that bullish view again on 3 October. Today’s
BUY signal just means that conditions are good. Sometimes the NTSM will issue a
buy-signal at a top. I don’t think that is the case this time – I remain
bullish.
