Jobless Claims ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...
80-years ago brave men landed in France continuing
efforts to rescue Europe and the world from Hitler’s ambitions.
My father was unqualified for military service due to
medical concerns when he graduated from Virginia Military Institute in 1933. At
the start of WWII, he volunteered, but was again rejected for service. As it
turned out, he played a part in winning the war by working on the Manhattan
Project.
When the war started, President Roosevelt asked DuPont to
be the prime contractor to develop the atomic bomb. DuPont agreed on one
condition: their contract would be cost-plus a profit of $1. (Yes, one dollar.)
My father worked for DuPont and was assigned as a manager
at 2 facilities manufacturing heavy water (D2O). Heavy water slows the neutrons
in a reactor and facilitates nuclear fission. In today’s dollars the heavy
water effort alone cost over 300-million dollars.
In an odd coincidence, while my father was making heavy water,
my wife’s mother was working for DuPont in Wilmington Delaware. As a book-keeper
she reported to her supervisor that the cost of a tank-car of material being
shipped to Washington state was far too high. Her boss said, I can’t tell you
what it is, but it is going to end the war. At the time, her husband was a
prisoner of war in Japan. My wife’s mother and father were reunited when the
war ended.
Our parents were part of the Greatest generation.
************
“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.
JOBLESS CLAIMS (Yahoo Finance)
“The number of Americans applying for jobless claims rose
last week, but layoffs remain at healthy levels despite lingering inflation and
high interest rates. Unemployment benefit applications for the week ending June
1 rose by 8,000 to 229,000, up from 221,000 the week before, the Labor
Department reported Thursday.” Story at...
https://finance.yahoo.com/news/slightly-more-americans-apply-jobless-124018950.html
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 slipped about 1pt to 5353.
-VIX declined about 0.4% to 12.58.
-The yield on the 10-year Treasury rose to 4.287%.
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) improved sharply to the bullish side (red line in the chart below).
Today, there were 6 Bear-signs and 17-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) turned higher.
TODAY’S COMMENT:
I had suspected that we might see a big bullish swing in
indicators, but I thought that it would occur on a strong up-day. Today the S&P 500 was flat, but indicators
are suggesting an all-clear signal. When
we see the spread between bull and bear indicators improve by 13, it is usually
after a bottom. If the McClellan Oscillator turns bullish, two more bear-signs would switch to bull. It looks like we’ll see new highs again; a move to
5600 is not out of the question.
Breadth improved, but the 10-dMA of issues advancing on
the NYSE is 49.3% indicating less than half of the issues have been up over the
last two weeks. A move above 50% would give us more confidence that the
weakness is over.
LONG-TERM INDICATOR: The Long Term NTSM indicator
remained HOLD: PRICE is bullish; VOLUME, 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.
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
THURSDAY 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 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.
