Jobless Claims ... Leading Economic Indicators ... Philadelphia FED Index ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
CHRISTMAS QUIZ:  During which part of the day do the ships arrive? Answer at bottom of blog.
 
WAR IS COMING (GB NEWS)
“The Chinese President, who recently returned from a visit to San Francisco, is expected to have the capacity to annex the island nation [Taiwan] by 2027. However, foreign policy hawk Gordon Chang suggested an attempt to subjugate Taipei would result in an “all out” global conflict... “It appears that Chinese doctrine on the first day of a war with Taiwan will target Japan and the United States for various reasons.”...China’s military buildup, response to sanctions, stockpiling efforts, surveying of American nuclear weapons, purging of dissident officers and mobilising the civilian population showed Beijing is “preparing” for conflict.” Story at...
'War is coming!' Xi Jinping's Taiwan invasion plan includes chilling warning about US 'attack' (msn.com)
My cmt: It’s possible.  I’ve wondered whether investors are buying Intel due to the threat of war.  If China takes Taiwan where will chips be made?
"The Taiwan question is a matter of national sovereignty, territorial integrity and national unity. So this is something like a life-or-death question for China … there's no room for concession." - Former Chinese Ambassador to the U.S., Cui Tiankai.
 
“Unsurprisingly, the all-Democrat appointed Colorado Supreme Court has ruled against President Trump. Supporting a Soros-funded, left-wing group’s scheme to interfere in an election on behalf of Crooked Joe Biden by removing President Trump’s name from the ballot and eliminating the rights of Colorado voters to vote for the candidate of their choice.” – Trump Campaign spokesman Steven Cheung.
My cmt. Typical Trumper – rude, crude, and wrong.  The only hope for a Joe Biden second term is for Donald Trump to be the republican candidate. Polls show that he would get demolished by former Governor of South Carolina, Nikki Haley, so if this was a partisan decision, they would have ruled in Trump’s favor.
 
THE COLORADO RULING CHANGED MY MIND – TRUMP SHOULD BE KEPT OFF THE BALLOT (The Atlantic)
“When I review divided appellate-court decisions, I almost always read the dissenting opinions first. The habit formed back when I was a young law student and lawyer—and Federalist Society member—in the late 1980s, when I would pore (and, I confess, usually coo) over Justice Antonin Scalia’s latest dissents.
I came to adopt the practice not just for newsworthy rulings that I disagreed with, but for decisions I agreed with...dissents are also intellectually useful: If there’s a weakness in the majority’s argument, an able judge will expose it, sometimes brutally...
[The article concludes] ... The strongest argument for throwing Trump off the ballot is the weakness of the counterarguments.” - George T. Conway III, attorney and a contributor to “The Atlantic.” Story at...
https://www.theatlantic.com/ideas/archive/2023/12/dont-read-the-colorado-ruling-read-the-dissents/676920/
My cmt: This was a good article taking the side that Trump should not be on the ballot. To those who say that Trump was not found guilty of insurrection, the Constitution does not require a guilty verdict. Further, Mr. Conway points out that the trial lasted 5 days and allowed a fair adjudication of the case. I don’t have a strong opinion.  It seems that a case can be made either way.  The Supreme Court will decide and “Who knows?” is the best guess.
 
JOBLESS CLAIMS (AP News)
“The number of Americans applying for unemployment benefits rose slightly last week but still remained at historically low levels despite high interest rates intended to slow hiring and cool the economy. The Labor Department reported Thursday that jobless claims were up by 2,000 to 205,000 the week that ended Dec. 16.” Story at...
https://apnews.com/article/unemployment-benefits-economy-jobs-50517b44ab237e81376d9c5b3872309d
 
GDP (Washigton Examiner)
“Third-quarter GDP growth revised down to 4.9% annual rate.” Story at...
https://www.washingtonexaminer.com/policy/economy/third-quarter-gdp-growth-revised-down-to-4-9-annual-rate
 
PHILADELPHIA FED INDEX (Market Screener)
“Industrial activity in the northeastern USA contracted at a sharper-than-expected pace in December, according to a survey published Thursday by the Philadelphia Fed. The Philly Fed index came in at -10.5 this month...” Story at...
https://www.marketscreener.com/quote/index/DOW-JONES-INDUSTRIAL-4945/news/USA-further-deterioration-in-the-Philly-Fed-index-45617991/
 
LEADING ECONOMIC INDICATORS (Conference Board)
"’The US LEI continued declining in November, with stock prices making virtually the only positive contribution to the index in the month,’ said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. ‘Housing and labor market indicators weakened in November, reflecting warning areas for the economy. The Leading Credit Index™ and manufacturing new orders were essentially unchanged, pointing to a lack of economic growth momentum in the near term. Despite the economy's ongoing resilience—as revealed by the US CEI—and December's improvement in consumer confidence, the US LEI suggests a downshift of economic activity ahead. As a result, The Conference Board forecasts a short and shallow recession in the first half of 2024.’" Press release at...
https://www.prnewswire.com/news-releases/the-conference-board-leading-economic-index-lei-for-the-us-fell-again-in-november-302021055.html
 
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 rose about 1% to 4747.
-VIX dipped about 0.1% to 13.65.
-The yield on the 10-year Treasury rose to 3.892%.
 
PULLBACK DATA:
-Drop from Top: 1%. 25.4% max (on a closing basis).
-Trading Days since All-Time Top: 495-days. (The top was 3 January 2022.)
The S&P 500 is 9.6% ABOVE its 200-dMA and 6.4% ABOVE its 50-dMA.
*I won’t call the correction over until the S&P 500 makes a new-high; however, evidence suggests the major bear-market bottom of the 25% decline was in the 3600 area and we called a buy on 4 October 2022.
 
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October 2022 lows).
XLY - Consumer Discretionary ETF. (Holding since the October 2022 lows - I bought more XLY 8/21/23.)
 
INTC – Added 12/6/2023.
BA – Added 12/6/2023.
 
DWCPF - Dow Jones U.S. Completion Total Stock Market Index. – Added 12/7/2023. This is a large position in my retirement account betting on Small Caps.
 
TODAY’S COMMENT:
Yesterday there was a 90% down-volume day. Today, 90% of the volume was up-volume and the S&P 500 closed near the top of its daily range - panic selling followed by panic buying. If that pattern continues, I’ll be worried that a top is near or has already ocurred.
 
Both RSI and Bollinger Bands have cleared their overbought indications, but the S&P 500 remains too far ahead of breadth (number of issues advancing) on the NYSE.
 
While there were some bearish signs today, the Summary of Indicators (Friday Rundown indicators) was 23-bulls and 2-bears market action doesn’t appear (at this point) to be particularly concerning.
 
I predicted months ago that the S&P 500 would make a new high this year.  The Index is close, 1% to go. Come-on markets, don’t fail me now.
 
The daily spread of 20 Indicators (Bulls minus Bears) remained +10 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved from +89 to +96. (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 BUY: PRICE, VOLUME & VIX are bullish; SENTIMENT is neutral. (One warning: The Long-Term Indicator is not a good top-indicator. It can signal BUY at a top.)
 
(The important major BUY in this indicator was on 21 October 2022, 7-days after the bear-market 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 remain bullish.
 
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
 
THURSDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals remained BUY. (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 65% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks. I’m “over invested” now expecting new, all-time highs this year. That burns all the cash.  I have about 25% of the portfolio in bonds.
 
I trade about 15-20% of the total portfolio using the momentum-based analysis I provide here. When I see a definitive bottom, I add a lot more stocks to the portfolio using an S&P 500 ETF as I did back in October.
 
CHRISTMAS QUIZ: Ans. “I saw three ships come sailing in, on Christmas day on Christmas day. I saw three ships come sailing in, on Christmas Day in the morning.”