Crude Inventories ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
THE FOOLISHNESS OF ENERGY WINDFALL PROFITS TAXES (MSN)
“The impact of windfall taxes on North Sea oil and gas exploration has turned out to be every bit as disastrous as critics predicted. More than 90 per cent of offshore firms are cutting investment, driven away by a raid on profits and the uncertain future caused by political meddling... The cuts mean the UK’s potential oil and gas resources have been downgraded, with 500 million barrels less likely to be produced – enough to support the nation for six months. This will just make Britain more dependent on imports. Indeed, as domestic production declines in the UK, overall reliance on oil and gas has actually increased.” Story at...
The foolishness of the energy windfall tax has now been proven (msn.com)
 
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 7.5 million barrels from the previous week. At 473.7 million barrels, U.S. crude oil inventories are about 6% above the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
 
SEASONALS REMAIN STRONG (Heritage Capital)
“...this week continues to be strong on a seasonal basis. Last week’s high in the various major stock market indices is the next point for the bulls and bears to embrace. Until then on the upside it is just noise, however I do believe the market will exceed those highs shortly. Beyond this week, we also have strong seasonal trends in April and the entire Q2. Remember, seasonals act as nice tailwinds or headwinds, but they are not triggers for a trade...The narratives haven’t been easy for the bulls. Historic yield curve inversion, bank failures, recession impending and saber rattling. Nonetheless, you already know that it’s not the news, but how markets react.” – Paul Schatz, President Heritage Capital. Commentary at...
https://investfortomorrow.com/blog/seasonals-remain-strong-banks-still-key/
 
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 1.4% to 4028.
-VIX slipped about 4% to 19.12.
-The yield on the 10-year Treasury rose to 3.569%.
 
PULLBACK DATA:
-Drop from Top: 16% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 310-days.
The S&P 500 is 2.4% ABOVE its 200-dMA and 0.3% ABOVE its 50-dMA.
*I won’t call the correction over until the S&P 500 makes a new-high; however, evidence suggests the bottom was in the 3600 area.
 
MY TRADING POSITIONS:
I am not trading as much as in the past. You may wish to use the momentum charts and/or the Monday 40-day gain charts for trading the Dow stocks and ETFs.
QLD – 2xNasdaq 100
SSO – 2x S&P 500
XLK – Technology ETF.
XLE – Energy Sector ETF. It hasn’t been doing much recently, but Russia is cutting production and that should help the sector.  We have a good dividend in the meantime.
BA – (Boeing) I am late on this one, but we’ll see. They have more work than they can handle and are hiring. They should do well going forward. Boeing reports earnings 4/26/2023.
XLY - Consumer Discretionary ETF.
KRE – Regional Banking ETF. This is a small position for me.  I have no cash left.
 
SHY – Short term bonds. 30-day yield is 4.6%. (Trailing 1-year yield is 1.3%.) I’ll hold this, but if the market retests the lows, I’ll sell it and buy stocks.)
 
 
TODAY’S COMMENT:
The S&P 500 finally broke above its 50-dMA an excellent sign for the Bulls.

My Money Trend indicator is based on an equation that relates advancing and declining volumes, advancing and declining stocks and changes in price (NYSE Composite) to produce the red indicator line (Advancing $ minus Declining $) in the above graph. There are a lot of percentages in the equations so the numbers on the right axis aren’t meaningful, except for the direction.  Now it’s headed up, and that’s bullish.
 
I expect that the market weakness is now over and we should see clear sailing for a month or more.  Sorry bears, after 3 months of weakness, I think the Bulls are back.
 
Today, the daily spread of 20 Indicators (Bulls minus Bears) improved from +6 to +8 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved from -14 to -3. (The trend direction is more important than the actual number for the 10-day value.) These numbers sometimes change after I post the blog based on data that comes in late. Most of these 20 indicators are short-term so they tend to bounce around a lot.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator was BUY: VOLUME is bullish; SENTIMENT, VIX & PRICE are neutral. The big improvement in the new-high/new-low data we noted on Monday, along with the Volume Indicator, pushed the indicator to BUY.    
 
(The important BUY in this indicator was on 21 October, 7-days after the bottom. For my NTSM overall signal, I suggested that a short-term buying opportunity occurred on 27 September (based on improved market internals on the retest), although without market follow-thru, I was unwilling to call a buy; however, I did close shorts and increased stock holdings. I issued a Buy-Signal on 4 October, 6-days before the final bottom, based on stronger market action that confirmed the market internals signal. The NTSM sell-signal was issued 20 December, 8 sessions before the high of this recent bear market, based on the bearish “Friday Rundown” of indicators.)
 
Bottom line: Back to Bullish! Go Bulls!
 
ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily)
ETF ranking follows:

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
 
DOW STOCKS - TODAY’S MOMENTUM RANKING OF THE DOW 30 STOCKS (Ranked Daily)
DOW 30 momentum ranking follows:

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)

My basket of Market Internals remained 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 most useful when they diverge from the Index.) 
 
 

...My current invested position is about 75% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks.
 
I trade about 15-20% of the total portfolio using the momentum-based analysis I provide here. If I can see a definitive bottom, I’ll add a lot more stocks to the portfolio using an S&P 500 ETF.