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

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
“Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves.” - Peter Lynch, former manager of Fidelity’s Magellan® fund.
 
“Today’s Republicans don’t have issues—not like the ones they used to have. Balanced budget? They care about that as much as they care about who won the new season of “RuPaul’s Drag Race.” “Owning the libs” is the only issue.”  – Bill Maher.
My cmt: Unfortunately, true.  What’s worse? Tax-and-Spend Democrats or Cut-Tax-and-Spend Republicans.
 
BIDEN’S TITLE IX WEAPON (WSJ)
“The Biden administration’s Title IX rule, which the Education Department published on April 29, is a looming disaster for women and girls. Before this rule, the trend of men using women’s locker rooms, showers and bathrooms—and taking women’s titles, trophies and scholarships in athletic competitions—was only a partial reality, relegated to certain left-leaning states and school districts. No longer. With its sweeping decision to reinterpret “sex” discrimination to include “gender identity” in Title IX, the administration has opened the floodgates for males to enter female spaces nationwide...
... For the sake of America’s youth, particularly girls, courts should quickly block the administration’s unlawful mandate and protect the educational opportunities that Title IX promises girls and women.” – Kristen Waggoner, President and General Counsel of Alliance Defending Freedom. Story at...
https://www.wsj.com/articles/biden-turns-title-ix-into-a-weapon-against-women-and-girls-07a516f4
 
DEBT AND DEFICITS ARE CAUSING WORRY (CNBC)
“Government debt that has swelled nearly 50% since the early days of the Covid pandemic is generating elevated levels of worry both on Wall Street and in Washington. The federal IOU is now at $34.5 trillion, or about $11 trillion higher than where it stood in March 2020. As a portion of the total U.S. economy, it is now more than 120% [about what it was at the end of WWII]...
... in recent days the chatter has spilled over into government and finance heavyweights, and even has one prominent Wall Street firm wondering if costs associated with the debt pose a significant risk to the stock market rally... More immediately, there are concerns that rising bond yields could spill over into the equity markets.” Story at...
https://www.cnbc.com/2024/05/19/soaring-debt-and-deficits-causing-worry-about-threats-to-the-economy-and-markets.html
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 0.3% to 5321.
-VIX dipped about 2% to 11.86.
-The yield on the 10-year Treasury declined to 4.412%.
 
MY TRADING POSITIONS:
UWM – Added 5/2/2024
QLD – Added 4/29/2024
SSO – Added 4/29/2024.
XLE – Added 4/24/2024
 
CRM – Added 1/22/2024.
XLK – Technology ETF (holding since the October 2022 lows). I don’t want to pay taxes on this gain, so I am holding this position.
 
DWCPF - Dow Jones U.S. Completion Total Stock Market Index. – Added 12/7/2023 when I sold the S&P 500.
“The Dow Jones U.S. Completion Total Stock Market Index, also known as the DWCPF, is a widely used financial index that provides a comprehensive measure of the US equity market. The DWCPF includes all US stocks that are not included in the Dow Jones US Total Stock Market Index, which comprises large-cap and mid-cap companies. As a result, the DWCPF provides a complete picture of the US stock market, including small-cap and micro-cap companies, which are often overlooked by other indexes.” From...
https://fi.money/blog/posts/what-is-dow-jones-u-s-completion-total-stock-market-index-dwcpf
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
The Bull/Bear Spread (Bull Indicators minus Bear Indicators) continued to slowly slide to the bear-side, but remained bullish at 10 Bear-signs and 14-Bull. (The rest are neutral. It is normal to have a lot of neutral indicators since many of those are top or bottom indicators that will signal only at extremes.) The 10-dMA of spread (purple line in the chart below) was down today.
 
While it is easy to be bullish when the 10-dMA of Indicator spread is moving higher, it becomes more problematic when it stalls or retreats. The 10-dMA of indicator spread fell today. It’s a confirmation of what we already know – markets don’t go straight up and we really can’t expect the indicators always to be higher either.
 
RSI is overbought and the S&P 500 is once again more than 12% above its 200-dMA.  Both are bearish topping-signs, but by themselves they are not enough to suggest a top. We could be at a top, Mr. Market doesn’t pay attention to my blog, but at this point we don’t have the evidence of a top.

TODAY’S COMMENT:
Breadth indicators are all bullish. The market still looks OK to me.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained BUY: PRICE & VOLUME are bullish; VIX & SENTIMENT are neutral.
(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 am cautiously 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)
 

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
 
TUESDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals remained 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 75% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks, so this is a bullish, over-invested position. This is my max % for stock allocation.
 
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, usually by using an S&P 500 ETF as I did back in October 2022 and 2023.