Retail Sales ... 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.
 
“My immediate reaction when I saw this [Trump’s assassination attempt] on Saturday were horror at what was unfolding, relief that Donald Trump had lived and frankly grief for my beautiful country. Our job as American citizens is to reject violence and violent rhetoric in this time of crisis, however hard we want to fight for our ideas... [violence is]... the last refuge of the incompetent.” – Steven Colbert.
 
PHOTO SHOWING SMILING SECRET SERVICE AGENTS AFTER ASSASINATION ATTEMPT – FAKE (AP News)
“CLAIM: A photo from the attempted assassination of former President Donald Trump on Saturday shows Secret Service agents smiling as they surround him after the shooting.
AP’S ASSESSMENT: False. The photo was edited to make it seem as though the agents were smiling. In the original, taken by an Associated Press photographer, the same agents can be seen with neutral expressions.” Story at...
https://apnews.com/article/fact-check-trump-shooting-secret-service-smiling-photo-427049284678
 
AMERICA IS UNDER ATTACK – IT NEEDS A COMMANDER IN CHIEF (The Telegraph)
“Respect for Biden is rapidly falling among America’s allies, not only due to his endless gaffes, but because he projects weakness rather than strength, indecision instead of assertiveness, and has a willingness to throw US friends under the bus if it doesn’t suit his interests. This is a perilous moment, when the enemies of the free world are growing increasingly emboldened, and America’s closest friends can’t always rely on Washington... The dazed and confused look that President Biden displays at every international summit, including last week’s Nato meeting, is the sad image the United States now projects to the globe under his weak-kneed presidency. The stunning decline of Joe Biden is sadly mirrored by America’s descent on the world stage. It is an incredibly dangerous state of affairs, one that threatens not only America’s future but the peace and security of the entire free world.” Story at...
America is under attack – it needs a commander-in-chief (msn.com)
My cmt: The Telegraph is a British daily paper founded in 1855.
 
RETAIL SALES (AP News)
“Shoppers paused their spending in June from May, defying economic forecasts for a pullback and proving their resilience in the face of an uncertain economy. Retail sales were unchanged in June from May...” Story at...
https://apnews.com/article/retail-sales-july-inflation-economy-268b1edeb99a1320ad0b084d58bfeeef
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 0.6% to 5667.
-VIX rose about 0.5% to 13.19. (The Options Boys are worried.) 
-The yield on the 10-year Treasury declined to 4.172% (compared to this time, prior trading day).
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.
UWM – added 7/15.
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
The Bull/Bear Spread (Bull Indicators minus Bear Indicators) remained a very Bullish 9 Bear-signs and 19-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 up – a bullish sign, though this stat has flopped back and forth.
 

The Bull/Bear, 50-Indicator spread rose from +6 to +10 (6 more Bull indicators than Bear).
 
TODAY’S COMMENT:
The Overbought / oversold Index was oversold Tuesday. This indicator tends to signal short term moves so it suggests a down-day Wednesday.
 
Both RSI and Bollinger Bands are just a whisker away from being overbought. Is that close enough to trigger the WalI Street sell-side computers?  Maybe. If we assume close enough is bad enough, then, along with other Top Signs, they are sending a Top Warning suggesting some sort of pullback. We’ve been suggesting the possibility for a while, although we still don’t have the smoking gun. At least two critical Bear signs remain:
-The S&P 500 is 14.9% above the 200-dMA and that remains stretched. The bear sign is greater than 12%.
-Statistical analysis of daily moves is still indicating that the daily moves have gotten too predictably small, a sign of complacency. This suggests a top within the next 20-sessions, but since the first warning was 10-sessions ago, maybe we should expect a correction within the next 2-weeks. The last time we saw this indicator was at the 31 July top last year. That was followed by a 10% correction. One important caveat; no indicator is always right.
 
Tuesday was a statistically significant up-day. That just means that the price-volume move exceeded my statistical parameters. Statistics show that a statistically-significant, up-day is followed by a down-day about 60% of the time.  Tops almost always occur on Statistically-significant, up-days, but not all statistically-significant, up-days occur at tops. Today could be a short-term top, there were top indicators were very close to sending a strong top-signal, but I like to see a clear signal and we didn’t get one today.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained HOLD: VOLUME is bullish; PRICE, 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 “Summary of 50” indicator.
 
BOTTOM LINE
I am still Neutral on the market, a moderate pullback is coming. I wouldn’t be surprised to see a down-day Wednesday. From there we’ll see. If Wednesday is another up-day, all bets are off and next stop is the moon. If we were to see a correction, it would probably be in the 5-7% range so I will not try to time it.  I am more likely to be a buyer on the dip.
 
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 improved to 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 55% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks when markets are stretched; my current stock position is slightly above the norm. (75% is my max stock allocation when I am strongly bullish.)
 
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.