… 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.
 
“Never, never, never, believe any war will be smooth and easy, or that anyone who embarks on that strange voyage can measure the tides and hurricanes he will encounter. The Statesman who yields to war fever . . . is no longer the master of policy but the slave of unforeseeable and uncontrollable events.” - Winston Churchill.
 
“The Supreme Court on Friday shut down Virginia Democrats’ latest attempt to save a statewide referendum implementing a redrawn congressional map siloing Republicans into one of 11 districts. The unsigned order left in place the Virginia Supreme Court’s previous ruling which invalidated the voting referendum Democrats narrowly won.” Story at… 
Supreme Court bluntly swats down Virginia Dems' power grab
 
BOND CRISIS THREATENS STOCK MARKET (The Telegraph)
“The Iran war is doing more immediate damage to the economies of America, Europe and Japan via the bond markets than it is through the direct effects of the energy shock.
Borrowing costs have reached critical levels across the G7. They are resetting the price of credit for vast swaths of the global financial system. The effects are cascading through the mortgage industry and pushing a universe of over-indebted companies towards a refinancing crisis.
Stock markets cannot defy this force for long. Ultimately, equity prices are a highly geared function of future cash flows discounted by cost of interest. Sooner or later – and in my view sooner – the bond sell-off will short-circuit Wall Street’s tech-boom and set off a major equity correction.” - Ambrose Evans Pritchard, international business editor of the Daily Telegraph.
 
QUICK MARKET SUMMARY
-Tuesday the S&P 500 declined about 0.7% to 7354.
-VIX rose about 1% to 18.06.
-The yield on the 10-year Treasury rose to 4.667% (compared to about this time prior market day).
 
MY TRADING POSITIONS
NVDA – Added 12/1/2025 & 2/6/2026
“Despite all the bearish noise, Goldman Sachs isn’t backing down on Nvidia (NVDA) stock yet. After another stellar GTC showing, the bank reiterated its $250 price target and maintained a buy rating, underscoring confidence in the AI giant’s tremendous upside from current levels.” – 11 May. Story at…  
Goldman Sachs sends blunt message on Nvidia stock after GTC
“According to the 54 analysts' twelve-month price targets for NVIDIA, the average price target is $278.73. The highest price target for NVDA is $360.00, while the lowest price target for NVDA is $205.00.”- MarketBeat at… 
https://www.marketbeat.com/stocks/NASDAQ/NVDA/forecast/
 
SSO – Sold 5/14/2026.
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
At the close 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 declined from +1 to zero (Equal Bull indicators than Bear indicators), a NEUTRAL indication. I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread (purple on the chart above) that smooths daily fluctuations reversed down, a BEARISH sign that is more important than the daily numbers.
 
One of the more reliable indicators, the Fosback Short-Term Hi/Low Index, flashed sell today, Tuesday. Here’s some more on the subject from Hull Tactical:
“The Fosback High-Low Logic Index (HLLI), developed by Norman Fosback, is a market breadth indicator that identifies periods of extreme divergence by measuring the number of stocks hitting 52-week highs and lows simultaneously. A high reading indicates a severely "split" market, often signaling potential market tops or instability.” From…
https://hulltactical.com/2024/12/12/the-fosback-high-low-indicator/
 
This indicator warned 5-days after the top of the recent 9% correction when the S&P 500 was down less than 1%. It confirms the top-indicators from last week.
 
The 50-dMA is now 6% above the 50-day. The S&P 500 has fallen 1.9% from its all-time high.
 
Breadth remains weak; only 45% of issues on the NYSE have been up over the last 2 weeks. For now, longer term breadth values are still ok.
 
Breadth, as measured by issues advancing on the NYSE, was ok at the top so that suggests that if we do see a correction that it would be less than 10%. On the low side, pullbacks of 3% to 5% are normal and happen all the time. Indicators are still neutral so the guess now is that we are likely to see a small correction. 
 
BOTTOM LINE
I am bearish in the short-term expecting a relatively small pullback.
 
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 invested position is about 50% stocks, including stock mutual funds and ETFs. 50% invested in stocks is a normal, conservative position for a retiree. (80% 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 although I don’t trade as much as I used to. 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.