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

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
PRESIDENTIAL PORTRAIT

Inmate No. P01135809, Fulton County Sheriff’s Office.
 
“For those who revile Trump for his autocratic instincts, demagoguery, vulgarity and self-obsession, the mug shot may offer feelings of vindication. For the millions of Trump supporters who believe he is a victim of persecution, it will enshrine his status as a living political martyr on which his bid to regain the White House is rooted. While Trump’s team said he wanted to look defiant, the ex-president’s booking photo is likely to polarize Americans as much as his politics.” -  Stephen Collinson, CNN
 
My cmt: As a former Trump voter, I don’t revile Trump for his “autocratic instincts, demagoguery, vulgarity and self-obsession.” I despise him for leading a seditious conspiracy to overturn an election that he clearly lost. (It will be interesting to see if prosecutors can prove that in court.)
 
SHOCKING CANDOR ON FUEL STANDARDS (WSJ)
“For decades, bureaucrats in Washington have argued that fuel-economy mandates pay for themselves... But unlike in previous rulemakings, the costs are now so comically high that regulators can no longer pretend that mandating greater fuel economy for passenger cars is good for society... But the proposed rule says this White House’s not-so-secret password: climate change. What about it? Without a hint of sarcasm, page 5-39 of the department’s accompanying environmental assessment estimates that in 2060 the proposal would reduce average global temperatures by 0.000%... Chinese Communist Party officials must be reading our wonderful environmental assessments for comic relief as they ramp up coal production.” - Michael Buschbacher, partner at the law firm Boyden Gray PLLC and served in the Justice Department’s Environment Division (2020-21), and James Conde, counsel at Boyden Gray PLLC. Commentary at...
https://www.wsj.com/articles/transportation-department-fuel-standards-car-ev-electric-vehicle-auto-industry-climate-change-388d6dd0
If you would like to read and comment on this proposed rule, go to...
https://www.regulations.gov/document/NHTSA-2023-0022-0004
The comments I read were all form letters from Environmental Whackos who stated that “We urge NHTSA to finalize the strongest rule possible...” Your comments are very important to counter such mindless, partisan opinion.
 
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.6% to 4431.
-VIX slipped about 4% to 15.08.
-The yield on the 10-year Treasury slipped to 4.205%.
 
PULLBACK DATA:
-Drop from Top: 7.6%. 25.4% max (on a closing basis).
-Trading Days since Top: 414-days.
The S&P 500 is 6.9% ABOVE its 200-dMA and 0.6% BELOW 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 and we called a buy on 4 October 2022.
 
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October lows).
SPY – I bought a large position in the S&P 500 Friday, 8/14, in my 401k (it has limited choices).
XLY - Consumer Discretionary ETF. (Holding since the October lows - I bought more XLY Monday, 8/21.)
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.  (Added 8/24. So far, so good.)
 
TODAY’S COMMENT:
Breadth continues to improve and today, new-52-week-highs outpaced new-lows for the first time in 2 weeks. These are good signs suggesting the recent weakness is in the process of ending. We got a Bottom Signal 17 August when Bollinger Bands, RSI and the 50-dEMA of Fosback’s High Low Logic indicator all were suggesting a bottom. So far, that looks like a very good call since it was at the recent bottom. Today, the Short-term New-high/new-low data gave a buy signal. While indicators are improving, making short-term calls can be problematic so there is no gurantee guarantee that we have seen an end to this  pullback. Still, I am betting that the pullback has seen its bottom.  I’ll feel somewhat better when the S&P 500 breaks back above its 50-dMA (now resistance).
 
The daily spread of 20 Indicators (Bulls minus Bears) improved from -7 to -2 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved from -58 to -54. (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 remained HOLD: PRICE, VIX, VOLUME & SENTIMENT are neutral.
 
(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 21 December, 9 sessions before the high of this recent bear market, based on the bearish “Friday Rundown” of indicators.)
 
Bottom line: I am becoming more Bullish as indicators improve
 
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

MONDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals improved to HOLD. (My basket of Market Internals is 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 70% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks. I'll re-evaluate when the S&P 500 makes a new all-time high.
 
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 as I did back in October.