Existing Home Sales ... Nikki Haley for VP ... 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.
 
BIDEN AMNESTY ILLEGAL (Newsweek via msn.com)
“Biden's amnesty [mass amnesty for an estimated half million illegal aliens now married to U.S. citizens and who have lived in the U.S. for a decade or more] is blatantly, flagrantly, and offensively unconstitutional. [According to the Constitution] Only Congress, not the president, can "establish a uniform rule of naturalization." Prosecutorial discretion, which Biden (like Obama before him) laughably invokes, is only legitimate when applied on an individualized, case-by-case basis. Prosecutorial discretion does not apply to a blanket refusal to enforce large swaths of immigration law—an act which itself violates the president's Article II, Sec. 3 prerogative to "take care that the laws be faithfully executed." The president has plenary statutory authority under 8 U.S.C. Sec. 1201 to deport any alien (legal or illegal) at any time for any reason, but he does not have any reciprocal power to naturalize aliens outside of Congress.” Story at...
Joe Biden's Executive Amnesty Is Illegal, Unjust, and Self-Defeating | Opinion (msn.com)
My cmt: While the Democrats explicitly campaign on “restoring and strengthening our Democracy” (while implying Trump will destroy Democracy), Biden is again blatantly violating the Constitution, the very basis for our representative Democracy.
 
NIKKI HALEY THE CLEAR CHOICE FOR TRUMP’S VP (USA Today via msn.com)
“I believe that Trump’s best choice is to pick somebody who can make voting for him more palatable. Moderates who dislike President Joe Biden but are turned off by the Trump persona could be a deciding force in the election. ...Haley, as the vice president pick, would give Trump the best path forward. A Trump-Haley ticket would represent an olive branch extended between the two factions of the GOP at war with each other. Trump’s populist base would certainly take issue with it, but his supporters won't let any VP choice stand in the way of their vote for him.” Opinion at... 
Nikki Haley is the clear choice for Trump's VP pick. So I'm sure he'll go full MAGA. (msn.com)
My cmt: I couldn’t agree more, but Trump is too arrogant to think strategically, and further, he wants a MAGA “Yes Man.”
 
EXISTING HOME SALES (NAR)
“-Existing-home sales slipped 0.7% in May to a seasonally adjusted annual rate of 4.11 million. Sales descended 2.8% from one year ago.
-The median existing-home sales price jumped 5.8% from May 2023 to $419,300 – the highest price ever recorded and the eleventh consecutive month of year-over-year price gains.
-The inventory of unsold existing homes grew 6.7% from the previous month to 1.28 million at the end of May, or the equivalent of 3.7 months' supply at the current monthly sales pace...
... Eventually, more inventory will help boost home sales and tame home price gains in the upcoming months," said NAR Chief Economist Lawrence Yun.” Press release at...
https://www.nar.realtor/newsroom/existing-home-sales-edged-lower-by-0-7-in-may-as-median-sales-price-reached-record-high-of-419300
 
MARKET REPORT / ANALYSIS
-Friday the S&P 500 declined about 0.2% to 5465.
-VIX rose about 1% to 13.20.
-The yield on the 10-year Treasury declined to 4.257%.
 
MY TRADING POSITIONS:
UWM – Added 5/2/2024
QLD – Added 4/29/2024
XLK – Holding since the October 2022 lows.
 
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 13 Bear-signs and 11-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) started falling Friday – that’s a concern.

TODAY’S COMMENT:
The S&P 500 is in the center of the channel when we draw channel lines back to October (black dashed lines in the above chart). However, the S&P 500 is at the top of the channel extending back to July (red dashed line above) so that could be a sign that a retreat is due. I don’t know which alternative carries more weight; I’ve never been much of a chart guy. Let’s just say caution is warranted.  
 
Friday was “Triple Witching” as stock options, futures, and Index options all expired.  Volumes were much higher than normal. Market action can sometimes be odd on Triple Witching days, but today, price-action was subdued.
 
Final numbers showed high, unchanged-volume on Thursday and again on Friday (even after adjusting for the high volume associated with options expiration). As I’ve often said, many believe that this indicator suggests investor confusion at market turning points. The trend has been up so I would interpret this signal as predicting a turn down. Still, “High-unchanged-volume” is not one of my indicators because it is often wrong.  
 
The Bull/Bear, 50-Indicator spread is -2 (2 more Bear indicator than Bull indicators). This is a Neutral to Bearish indication, but since the 10-dMA of the 50 indicators is falling, let’s call it bearish.
 
Some additional Bearish indicators are: S&P 500 is 13.2% above the 200-dMA (The bear sign is greater than 12%.); the S&P 500 is too far ahead of breadth; there was a bearish outside reversal yesterday; my Money Trend indicator is falling; both short-term and long-term NewHi/NewLow indicators are bearish; RSI is overbought; and there are other bear signs.
 
While indicators have declined, there are some indicators that are improving or at least holding their own. The 10-dMA of issues advancing on the NYSE is still below 50%, indicating that for the last 2-weeks, less than half of all issues on the NYSE have been up. The good news is that the 50 and 100-dMA of issues advancing on the NYSE are both above 50% and my Breadth MACD indicator made a bullish cross today. Another breadth indicator, the McClellan Oscillator, is still in bearish territory, but it has been improving too. These breadth indicators confuse the issue and suggest that a correction may not be imminent. Top indicators agree.
 
My Top-indicators have not yet warned of a top, but they are close.  A big move higher (say greater than 1%) would probably suggest a top. So far indicators have suggested that a decline now might be in the 10% or less range due to the narrow advance.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained HOLD: PRICE is bullish; VOLUME, VIX & SENTIMENT is 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
Markets are stretched and breadth is looking weak. A 10% retreat is possible, although we don’t have a sell signal at this point. I will take profits in leveraged positions (QLD and UWM) Monday, since markets are looking weak. Let’s see what happens Monday.
 
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
 
FRIDAY 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 65% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks, so this is a bullish, over-invested position. 75% is my max stock allocation so I have some cash now.
 
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.