“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
Have a good Veteran’s Day Thursday. NYSE is open; the
Bond Market is closed.
JOBLESS CLAIMS (YahooFinance)
“New weekly jobless claims touched a fresh pandemic-era
low yet again this week, as labor shortages and companies' efforts to bring on
and retain workers, helping to put a cap on the pace of firings and other
separations... Initial unemployment claims,
week ended November 5: 267,000 vs. 260,000 expected...” Story at...
https://finance.yahoo.com/news/weekly-jobless-claims-week-ended-november-5-2021-190316751.html
CPI (CNBC)
“-The consumer price index surged 6.2% from a year ago in
October, the most since December 1990.
-Core inflation, stripping out food and energy, increased
4.6%, the fastest gain since August 1991.”
Story at...
https://www.cnbc.com/2021/11/10/consumer-price-index-october.html
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in
the Strategic Petroleum Reserve) increased by 1.0 million barrels from the
previous week. At 435.1 million barrels, U.S. crude oil inventories are about
7% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
JOHN DURHAM IS GETTING CLOSE TO THE JUGULAR (RealClear
Politics)
“Last week,
John Durham’s grand jury issued its third criminal indictment in the
Trump-Russia collusion hoax. The person who was arrested may be obscure; the
news may have been buried after Virginia’s bombshell election results; but
Durham’s move is a big deal. It shows that the special counsel’s probe is
methodically unraveling a huge conspiracy, seemingly engineered by Hillary
Clinton’s 2016 campaign and implicating James Comey’s FBI, either as a willing
participant or as utterly incompetent boobs... What Durham and a few intrepid
reporters are uncovering may well be the most ambitious dirty trick pulled in
an American election and its aftermath.” – Charles Lipson, professor
emeritus of political science at the University of Chicago. Story at...
This article is a
good accounting of the Trump-Russia collusion hoax from start to...not finished
yet.
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as of
8:00 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. I added the smoothed 10-dMA of new cases (in purple) to the chart.
Trend numbers remain essentially flat. At this point, we
worry that the new cases may start rising, but it is too soon to make a call
either way.
Cases are down in the south. My daughter is an ER nurse
in Richmond, VA. Monday and Tuesday were
the first times in 2 years that she has not seen a single new Covid positive
patient in the ER.
“Things are trending in the opposite direction outside of
the U.S. South. Cases are up 25% in the Midwest, 18% in the Northeast and
4% in the West over the past two weeks.” - https://www.cnbc.com/2021/11/10/after-weeks-of-declines-us-covid-cases-have-leveled-off-at-a-high-level-the-ers-are-packed.html
Here are the recent nationwide stats so we can see the
curve is flat. I am following the purple smoothed 10-day average of new cases.
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 dipped about 0.8% to 4647.
-VIX rose about 5% to 18.73.
-The yield on the 10-year Treasury rose to 1.554%.
Volume picked up at the recent top on Monday. That’s often happens at tops as late-comer investors
jump in. What are not seeing are high-volumes on the days after the top. After
an important top, sellers are rushing to get out. No rush yet, so this doesn’t
look like an important top, so far. It is most likely just a reset after the
long run higher we’ve seen recently. Breadth is OK, too.
7.9% of all issues traded on the NYSE made new, 52-week
highs when the S&P 500 made a new all-time-high today, Monday, 8 November. This
is above average for all-time highs and it suggests that if we do have a
pullback, it is likely to be less than 10%.
So far, I haven’t seen many signs of a pullback. We have
been due for a breather and I think that’s what we’re seeing now. Futures are
up as I write this, but it may take a few more down-days to clear the extreme
up-day stats over the last 10 and 20-days.
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. Hopefuly, this will
signal a return to the bull sentiment that we have been watching for awhile.
The daily sum of 20 Indicators improved from +1 to +5 (a
positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations improved from +8 to +16 (These numbers
sometimes change after I post the blog based on data that comes in late.) Most
of these indicators are short-term so they tend to bounce around a lot.
The Long Term NTSM indicator ensemble
remained HOLD based on the bearish number of up-days over a 10 and 20-day time
frame. Price and Volume are bullish; Sentiment and VIX indicators are neutral.
I am cautiously bullish.
I will be cutting back to my normal fully invested
position (50% in stocks) from my current position of 65% in stocks if topping
indicators or other important indicators warn, but I don’t think we’ll see to many
topping signals for awhile.
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
** XLE has outgained XLY over
the last 2.
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 improved to BUY.
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.
My stock-allocation in the
portfolio is now about 65% invested in stocks; this is above my “normal” fully
invested stock-allocation of 50% stocks. Indicators are very bullish, so I am
holding a short-term position in additional Index Funds to boost returns.
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 general rule, some
suggest that the % of portfolio invested in the stock market should be one’s
age subtracted from 100. So, a
30-year-old person would have 70% of the portfolio in stocks, stock mutual
funds and/or stock ETFs. That’s ok, but
for older investors, I usually don’t recommend keeping less than 50% invested
in stocks (as a fully invested position) since most people need some growth in
the portfolio to keep up with inflation.
