... 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.
“President
Trump has ordered a pause on U.S. aid going to Ukraine in its war
against Russia, a consequential move as he clashes with Ukrainian
President Volodymyr
Zelensky about the path to ending the conflict.” Story at...
https://thehill.com/homenews/administration/5174156-trump-pauses-aid-to-ukraine-amid-clash-with-zelensky/
My cmt: I can only think of one word – “Disgraceful.”
“Rep. Don Bacon (R-NE) scolded
President Donald Trump over his Oval Office tirade against Ukrainian President Volodymyr
Zelensky on Friday, calling it ‘a bad day for America’s foreign policy’...
‘Ukraine wants independence, free markets and rule of law. It wants to be part
of the West. Russia hates us and our Western values. We should be clear that we
stand for freedom...’” Story at...
GOP
Congressman Scolds Trump Over Disastrous Zelensky Meeting: ‘A Bad Day’
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Tuesday the S&P 500 fell about 1.2% to 5778.
-VIX rose about 3% to 23.37.
-The yield on the 10-year Treasury rose (compared to
about this time, prior trading day) to 4.242%.
MY TRADING POSITIONS:
None
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 16 gave Bear-signs
and 7 were Bullish. The rest are neutral. (It is normal to have a lot of
neutral indicators since many of the indicators are top or bottom indicators
that will signal only at extremes.)
TODAY’S COMMENT
The daily, bull-bear spread of 50-indicators remained a
Bearish -9 (9 more Bear indicators than Bull indicators). The
10-dMA of the spread continued falling, a bearish sign.
The S&P 500 closed about 1% above its 200-dMA. So
far, the drop from the all-time high is 5.6%. My numbers suggested a drop of
10% or greater during this correction due to poor breadth that we noted at the
all-time high 2-weeks ago.
Bollinger Bands and RSI are both “oversold” so I’d expect
that Wednesday will finally give us a bounce. There have only been 3 up-days in
the last 2-weeks on the S&P 500 – we’re overdue. Based on indicators I still suspect that
markets have farther to fall. I’m still expecting a drop of at least 10%, but of
course, there are no guarantees.
Tuesday was another statistically significant down-day.
That just means that the price-volume move exceeded my statistical parameters.
Statistics show that a statistically-significant, down-day is followed by an up-day
about 60% of the time. Bottoms almost always occur on/or near
Statistically-significant, down-days, but not all statistically-significant, down-days
occur at bottoms. Today could be a bottom, there were 2 Bottom Indicators, RSI
and Bollinger Bands. My guess is that it will be a bounce but in the 3-day
bounce zone.
Repeating yesterday’s comment: As noted by Jeffrey Saut
during another correction, “...we could be in one of these “selling stampedes”
that tend to last 17 – 25 sessions, with only 1.5- to three-day
pauses/throwback rallies, before they exhaust themselves on the downside... it [is]
too soon to tell yet if this is such a stampede, but “Never on a Friday.” The
reference was that once the markets get into one of these weekly downside
skeins, they rarely bottom on a Friday. Nope, they typically give participants
over the weekend to brood about their losses and then they show up the next
Monday in “sell mode” leading to Turning Tuesday.”
Volumes on down-days increased again Tuesday as
additional fear is creeping into the markets – I don’t see a durable bottom
yet, although, one suspects that if Trump reversed his Tariff stance, we might
see a significant bounce.
BOTTOM LINE
I am bearish with a very conservative allocation of only
about 30% invested in stock holdings.
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 remained SELL. (My basket of Market
Internals is a decent trend-following analysis that is most useful when it
diverges from the Index.)
...My current invested
position is about 30% stocks, including stock mutual funds and ETFs – somewhat
bearish. (I’ll need to recalculate the %.) 50% invested in stocks is a normal
position. (75% is my max stock allocation when I am confident that markets will
continue higher; 30% in stocks is my Bear market position.)
I trade about 15-20% of the total portfolio using the
momentum-based analysis I provide here. When I see bullish signs, 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.
