“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“The big money is not in the buying and selling. But in
the waiting.” - Charlie Munger, Vice Chairman, Berkshire Hathaway
“This country was founded by the bayonet;
it survives by the ballot. Those who
falsely disparage the honesty of our elections are striking a blow at the foundations
of our nation and should be charged with sedition.” – Meade Stith
“In my decades of investing experience, I have not seen
such mindless and uninformed speculation as I have witnessed recently. Indeed, in nominal
dollar terms...it is far in excess of the dot.com boom.” – Doug Cass.
NEW HOME SALES (The Hill)
“Sales of new homes plunged in February as harsh winter
weather and supply issues interrupted a scorching hot housing market,
according to data released
Tuesday by the Commerce Department.
The seasonally adjusted number of new homes sold fell
18.2 percent in February...” Story at...
https://thehill.com/policy/finance/544493-new-home-sales-fall-more-than-18-percent-in-february
RICHMOND FED INDEX (Morningstar.com)
“Manufacturing activity across the central Atlantic
region of the U.S. expanded in March at slightly quicker pace than that of the
previous month, data from a survey from the Federal Reserve Bank of Richmond
showed Tuesday. The Fifth District Survey of Manufacturing Activity's composite
index was 17 in March, up from 14 in February.” Story at...
US ECONOMY ON THE BRINK OF COMPLETE RECOVERY (CNBC)
“The U.S. economy is recovering from the Covid-19
recession, but some economic “scarring” may take a long time to heal, said
Richmond Federal Reserve Bank President Thomas Barkin.” Story at...
https://www.cnbc.com/2021/03/22/richmond-feds-barkin-on-us-economic-recovery-potential-scarring.html
...sure do need that $1.9-trillion relief bull er bill. (A lot of this bill is not Covid related.)
THE FED HAS FORCED INVESTORS TO TAKE ON EXCESS RISK (Real
Investment Advice)
“The “debt problem” is also why the Federal Reserve has
found itself in a “liquidity trap.”
Interest rates MUST remain low, and debt MUST grow faster
than the economy, just to keep the economy from stalling out. Before
you argue that point, ask yourself this one question: If the economy was strong,
employment was full, and financial prosperity was high, then why did it require
almost $39 trillion since 2009 to keep a $20 trillion economy afloat?”
Commentary at...
https://realinvestmentadvice.com/the-fed-has-forced-investors-to-take-on-excess-risk/
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 6:30pm Tuesday. US total case numbers are on the left axis; daily numbers
are on the right side of the graph with the 10-dMA of daily numbers in Green.
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 fell
about 0.8% to 3941.
-VIX rose about 8% to 20.30.
-The yield on the 10-year
Treasury slipped to 1.611%.
Looks like we are beginning
another pullback. Today, only 12% of the volume on the NYSE was up-volume and only
23% of issues advanced. New-lows out paced new-highs today. The last time that occurred was the day the
S&P 500 tested its 50dMA, about 3 weeks ago – at the bottom of the small
pullback.
We continue to have “Distribution
Days.” Now, there have been 9 in the last 3-weeks; 5 is the sell sign. There
have been no follow-thru days in my system that would cancel this sign.
XLI is now underperforming the
Index and that is a concern.
.
It looks like the S&P 500
will test the 50-dMA.
The daily sum of 20 Indicators
dipped from -5 to -6 (a positive number is bullish; negatives are bearish); the
10-day smoothed sum that smooths the daily fluctuations dropped from +46 to +34
(These numbers sometimes change after I post the blog based on data that comes
in late.) Most of these indicators are short-term and many are trend following.
The Long Term NTSM indicator
ensemble remained HOLD. Volume is bullish; Price, VIX & Sentiment
are neutral.
I remain bullish, but cautiously so.
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.
*For additional background on
the ETF ranking system see NTSM Page at…
http://navigatethestockmarket.blogspot.com/p/exchange-traded-funds-etf-ranking.html
TODAY’S RANKING OF THE DOW 30
STOCKS (Ranked Daily)
Here’s the revised DOW 30 and
its momentum analysis. The top ranked stock receives 100%. The rest are then
ranked based on their momentum relative to the leading stock.
For more details, see NTSM
Page at…
https://navigatethestockmarket.blogspot.com/p/a-system-for-trading-dow-30-stocks-my_8.html
TUESDAY MARKET INTERNALS (NYSE
DATA)
Market Internals remained NEUTRAL on the market, but not by much. Internals
were nearly giving a bear sign.
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.
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.
As of 9 March, my stock-allocation
is about 60% invested in stocks. You may wish to have a higher or lower %
invested in stocks depending on your risk tolerance. 50% is a conservative
position that I consider fully invested for most retirees.
As a retiree, 50% in the stock
market is about fully invested for me – it is a cautious and conservative number.
If I feel very confident, I might go to 60%; if a correction is deep enough, and
I can call a bottom, 80% would not be out of the question.
The markets have not
retested the lows on recent corrections and that left me under-invested on the
bounces. I will need to put less reliance on retests in the future.
