PMI ... Construction Spending ... 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.
 
“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’
 
"The frontline defense of the UK starts in Ukraine." - John Healey, Britain's Defense Secretary
 
Speaking of Putin, Trump said:
 "I think he'll keep his word. I've spoken to him, I've known him for a long time now, you know, we had we had to go through the Russian hoax together –– that was not a good thing. It's not fair, that was a rigged deal and had nothing to do with Russia. It was a rigged deal inside the country and they had to put up with that too. They put up with a lot." – Donald Trump.
My cmt: You had to go through the Russian hoax together??? What the Hell does that mean? As for keeping his word...
“In 1994, Ukraine agreed to transfer [nuclear] weapons to Russia for dismantlement and became a party to the Treaty on the Non-Proliferation of Nuclear Weapons, in exchange for economic compensation and assurances from Russia, the United States and United Kingdom to respect the Ukrainian independence and sovereignty in the existing borders. Years later, Russia, one of the parties to the agreement, invaded Ukraine.” - From Wikipedia at...
https://en.wikipedia.org/wiki/Ukraine_and_weapons_of_mass_destruction#:~:text=In%201994%2C%20Ukraine%20agreed%20to,independence%20and%20sovereignty%20in%20the
 
“President Donald Trump has taken a decisive step in his administration's ongoing efforts to curb federal spending by ordering a 30-day freeze on 4.6 million government-issued credit cards. This initiative is a key component of a larger strategy aimed at ensuring that government spending is both transparent and accountable to the American public.” Story at...
President Trump freezes 4.6 million credit cards for 30 days
My cmt: He is decisively wasting money. Credit cards save money by reducing paperwork. It is easy to catch employee misuse of the cards.
 
TARIFFS ARE A TAX ON GOODS (CNN)
“Tariffs are actually — we’ve had a lot of experience with them — they’re an act of war, to some degree,” Buffett said in an interview with CBS that aired on Sunday. The Berkshire Hathaway CEO and billionaire investor said tariffs over time serve as a tax on goods and could raise prices for consumers. “The Tooth Fairy doesn’t pay ‘em!” Buffett said with a laugh.” –  Story at...
https://www.cnn.com/2025/03/03/business/warren-buffett-tariffs-trump/index.html
 
TREASURY SAYS TARIFFS WON’T CAUSE INFLATION (CNBC)
“Treasury Secretary Scott Bessent said Sunday that President Donald Trump’s proposed tariffs are unlikely to raise inflation...” – Story at...
https://www.cnbc.com/2025/03/02/scott-bessent-says-trump-tariffs-wont-cause-inflation-to-increase.html
My cmt: Who you gonna’ call? A Trump crony or the Oracle of Omaha.
 
ISM MANUFACTURING (ISM)
“U.S. manufacturing activity expanded marginally for the second month in a row in February after 26 consecutive months of contraction. Demand weakened, while output stabilized and inputs, for the first time in several months, contributed to PMI® growth.” Report st...
https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/february/
 
CONSTRUCTION SPENDING (Reuters)
“U.S. construction spending unexpectedly fell in January, pulled down by a decline in outlays on multi-family homebuilding. The Commerce Department's Census Bureau said on Monday that construction spending dropped 0.2% after an unrevised 0.5% increase in December.”Story at...
https://www.reuters.com/markets/us/us-construction-spending-unexpectedly-declines-january-2025-03-03/
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Monday the S&P 500 fell about 1.8% to 5850.
-VIX rose about 16% to 22.78.
-The yield on the 10-year Treasury declined (compared to about this time, prior trading day) to 4.159%.
 
MY TRADING POSITIONS:
None
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 17 gave Bear-signs and 8 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 declined to a Bearish -9 (9 more Bear indicators than Bull indicators). The 10-dMA of the spread continued falling, a bearish sign.
 
The Short Term, Fosback Hi/Lo Logic Index turned bearish today.  That’s an indicator that signals rarely. It gave a bearish signal near the top of the 2022, 25% correction. It also signaled more recently, after the bottom of a small, 4% decline in September of 2024, so we’re left wondering what this time will bring.  It has been reliable in the past since it called the top of the Coronavirus bear market to the day. 
 
My VIX indicator has been "sell" for a week. That indicator is one of the more reliable signals.
 
So far, the Drop from the all-time high is only 4.4%.
 
Bollinger Bands are “oversold.” That’s the only bottom indicator I have now, but it doesn’t mean much. Oversold conditions can last a long time.
 
Monday was a 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 short-term bottom, but there was only one Bottom Indicator, not enough to send a strong, bottom-signal.
 
The S&P 500 is now 2.2% above its 200-dMA.  That will be an important test for markets.
 
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.” Will tomorrow be a “turning Tuesday? I doubt it.
 
Volumes increased again Monday as additional fear came into the markets – I don’t see a 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

MONDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals declined to 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.