GDP ... Jobless Claims ... 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.
 
HARRIS WANT TO TAX UNREALIZED GAINS (msn.com)
“Kamala Harris is backing a tax plan that’s got a lot of rich people freaking out. The Biden administration wants to start taxing unrealized gains. What’s that? Basically, it’s a tax on money you haven’t even pocketed yet... You know how it goes—big news hits, and everyone starts buying or selling like crazy. We could see a lot of that if people start panicking about new taxes.” Story at...
Kamala Harris plans to tax unrealized gains – What it means (msn.com)
My cmt: Currently investors don’t pay taxes until a stock is sold. Details remain murky, but perhaps holdings would be valued at year end and gains would be taxed (?). I’m guessing, but this plan could cause a significant correction in markets even though it is proposed for the ultra-rich. Looks like a dumb idea to me. Cracking down on grocery stores for causing inflation is smart compared to this.
 
"Fat, drunk and stupid is no way to go through life, son." – Dean Vernon Wormer.
 
GDP 2ND EST (Reuters)
“...data showed the world's largest economy grew a little faster than expected in the second quarter, modestly reducing expectations for a larger 50 basis-point (bp) rate cut next month by the Federal Reserve. The report also added to growing expectations that the United States could avoid recession altogether, or go through just a mild one, analysts said.” Story at...
https://www.reuters.com/markets/currencies/dollar-holds-gains-ahead-us-inflation-test-2024-08-29/
 
JOBLESS CLAIMS (Benzinga)
“Initial jobless claims totaled 231,000 for the week ending Aug. 24, down from the upwardly revised 233,000 the previous week and slightly below the expected 232,000.” Story at...
https://www.benzinga.com/government/24/08/40624663/us-economy-expands-by-3-in-q2-surpasses-earlier-estimates-jobless-claims-little-moved-last-week
 
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 was unchanged at 5592.
-VIX fell about 9% to 15.65. 
-The yield on the 10-year Treasury rose to 3.863% (compared to about this time, prior trading day).
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.
XLK – added more 7/26. This reestablishes the position I had before this recent weakness.
UWM – added 7/15.
QLD – added 7/24.
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
The Bull/Bear Spread remained well to the bull side at 5 Bear-signs and 15-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 Bull/Bear, 50-Indicator spread (Bull Indicators minus Bear Indicators) improved to +10 (10 more Bull indicators than Bear indicators). The 10-dMA reversed down. We’ll keep an eye on this; no worry yet.
 
TODAY’S COMMENT:
Advancing-issues outpaced decliners by 2 to 1 on the NYSE; advancing-volume doubled declining-volume; there were 323 new, 52-week highs while there were only 17 new, 52-week lows; and the S&P 500 was flat? It happens, but not often.  I expect the S&P 500 to catch up Friday with an up-day.
 
The PCE Prices report is due out tomorrow. That’s the Fed’s favorite inflation gauge.  Perhaps markets are waiting for the news before buying large caps?
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained HOLD: VIX, VOLUME, SENTIMENT & PRICE are neutral. (This indicator is more valuable for Sell-signals and during major Bear Markets.)
 
{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 2022 (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 the 2022 bear market, based on the bearish “Summary of 50” indicator.}
 
BOTTOM LINE
I remain 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 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 when markets are stretched; my current stock position is 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.