Consumer Confidence ... Jobs Data ... 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.
ALASKA LIBERATION (WSJ)
“Last week the Senate approved a resolution, 52-45, to
reverse the Biden Administration’s giant Alaska land grab. No state suffered
more from the Biden team’s lawless war on fossil fuels than Alaska. A case in
point was the Interior Department’s move to restrict oil and gas leasing on 11
million acres in Alaska’s National Petroleum Reserve. Congress expressly set aside
this region in 1923 for oil and gas development, but the Biden climateers
didn’t care.” Opinion at...
https://www.wsj.com/opinion/alaska-national-petroleum-reserve-senate-resolution-cra-biden-administration-9e33f617?gaa_at=eafs&gaa_n=AWEtsqdFrLouwbZeHZIDre5-RagYMJbzJzLKwBFHtb3FtX2h7nNWn1iN547wm2RoaJU%3D&gaa_ts=690e3c28&gaa_sig=GzWdnfeF_64PLghiyqD9oKI1o165Uwr86krB-sWMpoKHa-tHt3lj7qU2ltd9ifI-2Zw5RIuwSfiK8S0pEX3ZqQ%3D%3D
“Natural
Resources Defense Council director Bobby McEnaney declared drilling in
the Arctic Refuge to be “reckless…public lands must serve people, wildlife, and
a livable climate — not host a fire sale for fossil fuel companies.” From...
https://www.thegazelle.org/issue/277/alaska-oil-drilling-allowed
My cmt: The environmentalists ignore that “...Congress
expressly set aside this region in 1923 for oil and gas development.”
CONSUMER CONFIDENCE (Univ of Michigan)
“Consumer sentiment fell back about 6% this November, led
by a 17% drop in current personal finances and a 11% decline in year-ahead
expected business conditions. With the federal government shutdown dragging on
for over a month, consumers are now expressing worries about potential negative
consequences for the economy. This month’s decline in sentiment was widespread
throughout the population, seen across age, income, and political affiliation...
Year-ahead inflation expectations inched up from 4.6% last month to 4.7% this
month and remained well below readings in May in the wake of the initial
announcements of major tariff changes.” Report at...
https://www.sca.isr.umich.edu/
ALTERNATE SOURCES FOR JOBS DATA (YahooFinance)
“Job postings are down, according to job search platform Indeed,
and data on the pace of new jobs being added is mixed. The economy either added a meager amount
of positions in October, according to private payroll processor ADP,
or shed them by a small amount, workforce intelligence firm Revelio
Labs found. On the other hand, layoffs seem
to be mounting — last month was the worst October for job cut
announcements since 2003, according to a report released Thursday from the
global outplacement firm Challenger, Gray & Christmas. But the unemployment
rate this year has so far been relatively stable amid a shrinking pool of
available workers, and an estimate from the Chicago Fed...” Story at...
https://finance.yahoo.com/news/theres-no-jobs-report-today-heres-what-it-mightve-shown-133019495.html
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose about 0.1% to 6729.
-VIX declined about 2% to 19.08.
-The yield on the 10-year Treasury rose slightly to 4.093%
(compared to about this time prior market day).
MY TRADING POSITIONS:
SPY – SOLD 11/7
XLK – SOLD 11/7
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
At the close today, of the
50-Indicators I track, 19 gave Bear-signs and 3 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 S&P 500 improved after noon so it looks like I
sold near the low. Ouch! We’ll find out Monday if the buying continues. Jim
Lebanthal, CNBC contributor, was convinced that this market weakness is due to
the Government shutdown. That might
explain the bounce in the afternoon since news came out that there was a proposal
from Democrats to end the shutdown. Democrats wanted to extend government subsidies
to health insurance companies for a year.
That would push the Medicare subsidies until the mid-term elections when
the Dems suspect they will regain the majority in Congress. Then they could try
to make the subsidies permanent. Republicans declined the offer.
The daily, bull-bear spread of 50-indicators remained -16
(16 more Bear indicators than Bull indicators), a BEARISH indication. I
consider +5 to -5 the neutral zone. The 10-dMA curve of the spread (purple on
the chart above) smooths daily fluctuations; it continued down, a BEARSH sign.
Some indicators improved after my noon check of the
indicators. Some got worse. First, the indicators that improved to Bullish: (1)
The 50-dMA of issues advancing on the NYSE moved above 50% sending a bullish
sign; (2) up-volume rose at a faster pace. (3) The 100-dMA of breadth remained
bullish. Those are now the three bullish indicators.
Both the Hindenburg Omen and the Fosback Hi/Low Logic
Index became more bearish. There are now 7 Hindenburg Omens in the last 8 days.
Even though indicators improved, they are still very weak.
I had to go back to 25 February of this year to find a
day when there were only 3 Bullish indicators. That was 4 days after the top of
the 19% correction that bottomed in April 2025. There were also 3 bull
indicators 5 days before the bottom of that correction. Indicators are still suggesting
a correction.
On the other hand, I probably would not have sold my
positions had I known that the markets would recover in the afternoon. The
afternoon is when the Smart Money makes decisions, so today, I was the Dumb
Money. Given the indicators, it may not be too dumb... we’ll see. The S&P
500 did close below its 50-dMA. Another close below the 50-day Monday would
confirm the change in trend.
I still suspect the market is in correction mode. I’ve
been saying that a correction now would likely be less than 10%. I think the
odds of a less than 10% decline are lower now based on the rapidly falling
indicators. Still, the Index is 9.8% above its 200-dMA and that’s a strong
level of support so a 10% correction makes perfect sense.
The odds are probably still pretty good that the decline
won’t be as high as 20%. It doesn’t seem like the bull market is over. Bull
markets end with euphoria – not with a whimper.
BOTTOM LINE
I’m bearish; I’ll took profits in my XLK and SPY positions.
Am I right? We’ll have to wait and see.
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
FRIDAY MARKET INTERNALS (NYSE DATA)
My basket of Market Internals improved to HOLD. (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.
