“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“People always ask me what is going on in the markets. It
is simple. Greatest Speculative Bubble of All Time in All Things. By two orders
of magnitude.” – Michael “Big Short” Burry.
"If I was Darth Vader and I wanted to destroy the US
economy, I would do aggressive spending in the middle of an already hot
economy...This is the biggest bubble I've seen in my career." - Stanley
Druckenmiller, billionaire investor.
“Inflation is not going to be transitory; I’ve been
pretty certain in my mind about three prior calls. This is the fourth one.” -
Mohamed El-Erian, Chief economic adviser at Allianz SE
ADP EMPLOYMENT CHANGE (CNBC)
“Job creation at private companies tumbled in July as
fears mounted over the spreading Covid-19 delta variant, payroll processing
firm ADP reported Wednesday. Employers added 330,000 positions for the month, a
sharp deceleration from the downwardly revised 680,000 in June.” Story at...
ISM NON-MANUFACTURING INDEX (Reuters)
“A measure of U.S. services industry activity jumped to a
record high in July, boosted by the shift in spending to services from goods,
but businesses continued to pay higher prices for inputs because of supply
constraints.” Story at...
https://www.reuters.com/world/us/us-private-payrolls-growth-slows-july-adp-2021-08-04/
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 3.6 million barrels from the
previous week. At 439.2 million barrels, U.S. crude oil inventories are about
6% below the five year average for this time of year.” Story at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
LAWYERS SANCTIONED OVER “FANTASTICAL” SUIT ALLEGING US
ELECTION WAS STOLEN (msn.com)
“A U.S. judge on Wednesday sanctioned two lawyers who
brought a lawsuit alleging the 2020 presidential election was stolen from
Donald Trump and his supporters, calling their case "one enormous
conspiracy theory."... [The Judge] Neureiter ordered the two lawyers, Gary
D. Fielder and Ernest John Walker, to pay the legal fees incurred by people and
entities they sued, including Facebook Inc and voting machine company Dominion
Voting Systems Inc.” Story at...
Lawyers
sanctioned over 'fantastical' suit alleging 2020 U.S. election was stolen
(msn.com)
My cmt: Once again, independent review shows that Trump’s “stolen election” wasn’t stolen. The Trump lawsuits have been shown to be completely without merit, so much so, that (once again) the lawyers bringing the suits have been sanctioned.
“The judge also noted that Trump Attorney General William Barr said as early as Dec. 1 that the FBI had investigated and found no evidence of fraud on a scale that would have affected Biden’s victory.” From...
INFRASTRUCTURE BILL MANDATES DRUNK-DRIVER DETECTOR FOR
NEW CARS (ZeroHedge)
“The $1 trillion infrastructure bill - a bipartisan 2,702-page
bill that has been locked in negotiations for months between Democrats and
Republicans will mandate all new vehicles must have the technology to
detect drunk drivers and alert systems to check backseats before turning off
the vehicle. A final vote is likely before next Monday.” Story at...
https://www.zerohedge.com/political/infrastructure-bill-mandates-new-cars-detect-drunk-driver
My cmt: I wonder if this technology is proven and will be
error free? I am very skeptical; Politicians do stupid stuff all the time. Your
pupils are dilated from the eye-doctor’s drops? Tough luck – the car won’t let
you drive! I’m making this up, but the systems do measure eye movements. I am
sure that there will be failures that will be very frustrating for those
involved.
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 5:00 PM Wednesday. U.S. total case numbers are on the left axis; daily
numbers are on the right side of the graph in Red with the 10-dMA of daily numbers
in Green.
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 dipped about 0.5% to 4403.
-VIX dipped about 0.4% to 17.97.
-The yield on the 10-year Treasury rose to 1.184%.
The daily sum of 20 Indicators declined from -5 to -9 (a
positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations declined from -35 to -40. (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
remained HOLD. Volume, VIX, Price & Sentiment are neutral.
I am cautiously bullish. I’ll
get concerned if this down-move becomes a trend.
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
WEDNESDAY 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.
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 stock-allocation is about 50%
invested in stocks. I am not super bullish (or bearish) and I am watching the
markets closely.
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.
