... 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.
 
"This is maybe the most dangerous market of my career, and that includes 1987's crash, that includes the savings and loan debacle market of the early '90s, that includes the 1999 to 2009 lost decade in the S&P 500 in the dot-com bubble. This is the most difficult market of my 45 years." -  Bill Smead, Smead Value Fund (SMVLX), May 2025.
 
ROBERT REICH SOUNDS ALARM (Huffington Post)
“Former Labor Secretary Robert Reich on Monday warned the United States could be heading toward ‘either martial law or civil war.’
In his latest Substack newsletter, the former Bill Clinton Cabinet member noted President Donald Trump’s talk of invoking the Insurrection Act could see him deploying troops domestically “despite any court orders stopping him.” Story at...
Robert Reich Sounds The Alarm On Trump Fear That’s ‘Unfolding Very Rapidly’
My cmt: These sorts of fears seem overblown. Will Trump fail to follow court orders? Even if he did, the military is trained not to follow illegal orders, at least they were when I was an Army officer. If there is a court order in place, the military won’t go against it. That calls into question the current Hegseth policy of attacking civilian boats in international waters because intelligence says they are drug-boats.  This is probably illegal, but it is a gray area for the time being – courts have yet to rule.  I wonder how the pilots feel?
 
MOODY’S SAYS THERE WAS NO JOB GROWTH LAST MONTH (Fortune)
“Everyone from Wall Street to the Federal Reserve knows America’s labor market is weakening—adding just 22,000 jobs according to the BLS’s latest release for August—but are unsure by how much.
Moody’s chief economist Mark Zandi wrote in a note over the weekend that data from Revelio Labs, which scrapes info from professional networking sites like LinkedIn to estimate jobs growth, shows that employment increased by some 60,000 roles in September...“Averaging the Revelio and ADP employment estimates for September suggests that there was essentially no job growth during the month...The bottom line is that not having the BLS jobs data is a serious problem for assessing the health of the economy and making good policy decisions. But the private sources of jobs data are admirably filling the information gap, at least for now. And this data shows that the job market is weak and getting weaker.” Story at...
America saw ‘essentially no job growth’ last month, warns Moody’s, and any roles added were in three wealthy states
 
1999 ALL OVER AGAIN (Seeking Alpha)
“Current market conditions feel like it’s 1999, according to Paul Tudor Jones, Tudor Investment Corporation founder and CIO and Robin Hood Foundation founder and board member. During a CNBC interview, Tudor Jones said that while this comparison to the dot-com bubble period wasn’t made lightly, “all the ingredients are in place” for a similar market environment.” Story at...
Paul Tudor Jones: ‘It feels like 1999’ as ingredients are in place for a dot-com bubble environment
My cmt: Jones noted that during the 1999 dot.com bubble the S&P 500 topped in March.
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 was down about 0.4% to 6715.
-VIX rose about 5% to 17.24.
-The yield on the 10-year Treasury declined to 4.127% (compared to about this time prior market day).
 
MY TRADING POSITIONS:
SPY – Added 8/26/2025
XLK – Added 8/26/2025
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 12 gave Bear-signs and 12 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 slipped from +4 to Zero (equal Bull indicators and Bear indicators), and remained a Neutral indication. I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread smooths daily fluctuations; turned down again – a Bearish sign.
 
Sentiment has become so bearish that it is now sending a bullish signal.  That seems counter intuitive, but this is a contrarian indicator. When too many investors are bearish, it may be near a bottom. This time though, we need to be wary regarding this indicator. Traders have been watching the same thing I have seen – markets have been up 7 days in a row.  That is a rarity and traders have been betting that a down-day is overdue for the last 3 or 4-days. Sometimes the bears are right as they were today.
 
Tuesday was Bearish Outside Reversal Day.
“An outside reversal is a price pattern that indicates a potential change in trend on a price chart. The two-day pattern is observed when a security’s high and low prices for the day exceed the high and low of the previous day’s trading session... Technical analysts and experienced traders prefer to build trading signals using this identification in conjunction with other information such as trend, support and resistance or technical studies.” – Investopedia.
 
One of my breadth measures, (10-dMA of issues advancing on the NYSE) turned negative again today. Internals and indicators have not shown a lot of strength while the major indices (S&P 500, Nasdaq, etc.) have been steadily climbing for the last 3-weeks.  
 
All-in-all, it appears that the S&P 500 will drift back towards its lower trendline.  That is partly a guess since the indicator spread remains neutral and either up or down would be in line with my indicators.
 
BOTTOM LINE
I am cautiously bullish to neutral. I’ll be paying attention to indicators, as always.
 
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 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 50% stocks, including stock mutual funds and ETFs.
50% invested in stocks is a normal, conservative position for a retiree. (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.