PPI ... Business Optimism ... 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.
 
THE KIDS HAVE NO IDEA (Newsweek)
“...moral judgment runs so strongly against that of the student divestment [of Israeli investment] demands that 14 states (including Illinois) increased their investments in Israel as a sign of solidarity with the country after the Oct. 7 massacre...
...Ben and Jerry's seemed to think that it could buy itself peace by caving into demands of a small Vermont BDS organization. [Boycott, Divestment, Sanctions (BDS) movement, whose aim is to destroy Israel as a Jewish state.] But it only bought itself trouble. The evidence is everywhere that the weight of moral judgment runs in Israel's favor, and that universities divesting from Israel will face substantial pushback. The universities are making the same mistake the ice cream maker did: vastly overweighting the view of the protesters they happen to see every day, and insufficiently considering the views of all their stakeholders.” Story at...
The Kids Have No Idea What They're Talking About on Israel | Opinion (msn.com)
 
SORRY MR. PREZ – INFLATION ISN’T DUE TO CORPORATE GREED (Tampa Free Press)
“The Federal Reserve Bank of San Francisco's research shows that while there has been an increase in markups (the difference between a product's selling price and its production cost) in select industries like motor vehicles, the overall markup rate has remained largely in line with previous economic recoveries. Contrary to Biden's claims, the data suggests that fluctuations in corporate markups have not been a driving force behind the ups and downs of inflation during the post-pandemic recovery... The report attributes the current inflationary pressures to other factors, such as the massive government stimulus spending [and the FED]...” Story at...
Debunking Biden’s “Greedflation” Claim: The Fed Reveals The True Drivers Of Inflation (msn.com)
My cmt: Yup, the Government caused the inflation, but it’s good politics to blame it on someone else.
“You will never find a more wretched hive of scum and villainy.” – Obi-Wan visits Washington DC.
 
ANOTHER FUN INTERNET LIST – ACTIVITIES TO AVOID AFTER AGE 75
[#6 & #7 were interesting.]
“6. Do Not Run for President... the rigors of campaigning, coupled with the immense pressures and demands of the presidency, require an extraordinary level of stamina, resilience, and mental acuity. These challenges can be particularly daunting for individuals in their eighties, potentially impacting their health and capacity to fulfill the role effectively...
 
7. Do Not Run a Country... Similarly, running a country, whether as a head of state or government, places immense responsibility on an individual's shoulders. These are shoulders that aren't as strong as they once were. It involves making critical decisions that affect millions, often in high-pressure situations requiring quick thinking and decisiveness. For someone in their eighties, the physical and mental demands of such a position and the 24/7 nature of the role could prove overwhelming, potentially impacting the effectiveness of governance and personal well-being...” Commentary at...
30 Activities to Avoid After 75: The Golden Years (msn.com)
 
PPI (CNBC)
“Wholesale prices jumped more than expected in April, putting up another potential roadblock to interest rate cuts anytime soon. The producer price index, a gauge of prices received at the wholesale level, increased 0.5% for the month... On a year-over-year basis, wholesale inflation rose 2.2%, also the highest in a year.” Story at...
https://www.cnbc.com/2024/05/14/ppi-report-wholesale-prices-rose-0point5percent-in-april-more-than-expected.html
Last month’s reading were revised down so this wasn’t a big a shock as it might have been.
 
NFIB BUSINESS OPTIMISM (Roanoke Times)
“NFIB’s Small Business Optimism Index rose by 1.2 points in April to 89.7, marking the first increase of this year but the 28th consecutive month below the 50-year average of 98. Twenty-two percent of owners reported that inflation was their single most important problem in their business, down three points from March but still the number one problem for small business owners.” Story at...
https://www.theroanokestar.com/2024/05/14/nfib-inflation-continues-to-hinder-small-business-operations/
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 0.5% to 5247.
-VIX declined about 1% to 13.42.
-The yield on the 10-year Treasury declined to 4.445%.
 
MY TRADING POSITIONS:
UWM – Added 5/2/2024
QLD – Added 4/29/2024
SSO – Added 4/29/2024.
XLE – Added 4/24/2024
 
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.
CRM – Added 1/22/2024.
 
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) remained bullish & improved to 6 Bear-signs and 18-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) continues to improve, a bullish sign.

TODAY’S COMMENT:

If today’s PPI report was a serious concern, the Russell would not have reacted as it did today.  The Russell opened higher (gapped up) and drifted down before bottoming around 1:30. Afterward, it closed about where it opened – up 1.1%. It would appear that investors are resigned to higher-for-longer interest rates.  I suspect they are happy because interest rates aren’t likely to go up.         
 
The Volume on the NYSE was about 20% higher than the monthly average.  I’d call that a bullish sign. The S&P 500 is only about 0.1% below its end of March all-time high.
 

LONG-TERM INDICATOR: The Long Term NTSM indicator improved to 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 bullish. The S&P 500 is headed back to all-time, new highs.
 
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)
I forgot to update this chart yesterday, but below is Friday’s chart. 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

TUESDAY 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 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 22 and 23.