Economy at Stall Speed…Revenues Weak

ECONOMY AT STALL SPEED (dShort.com)
“The overall picture of the US economy had been one of slow recovery from the Great Recession with a clearly documented contraction during the winter, as reflected in Q1 GDP. Data for Q2 and Q3 supported the consensus view that severe winter weather was responsible for the Q1 contraction -- that it was not the beginnings of a business cycle decline. However, the average of these indicators in recent months suggests that, despite the Q2 rebound in GDP, the economy remains near stall speed. We'll need some near-term improvement to avoid rolling over.” Extensive analysis and charts at…
http://www.advisorperspectives.com/dshort/updates/Big-Four-Economic-Indicators.php
Doug Short is known for reasoned and reasonable analysis. He is neither a perma-bear nor a fear monger.  This is worrisome.
 
REVENUE SOFTNESS WORRIES (WSJ)
“As investors pore over third-quarter earnings reports, they are finding signs of corporate malaise that are raising concerns about the outlook for U.S. stocks. While profit gains have generally been solid, many blue-chip companies are posting weak sales growth or outright year-over-year revenue declines, causing worries about their long-term growth prospects…many traders and analysts say they fear future growth at U.S. companies won’t be robust enough to meet the high expectations currently implied by the above-average valuations on blue-chip shares.” Story at…
http://online.wsj.com/articles/revenue-softness-worries-stock-investors-abreast-of-the-market-1415568827
 
MARKET REPORT
Tuesday, the S&P 500 was up 0.1% to 2040 (rounded). 
VIX was up about 2% to 12.92. 
Bond markets were closed today.
 
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) fell to 56% at the close Tuesday.  (A number above 50% is usually good news for the markets.) New-highs outpaced New-lows Tuesday.  The spread (new-highs minus new-lows) was +153. (It was +174 Monday). The 10-day moving average of change in the spread was 0. In other words, over the last 10-days, on average, the spread has shown no-change. Internals remained neutral on the market, because the smoothed 10-day slope of advancing volume is falling and New-high/new-lo data has deteriorated.

Market Internals are a decent trend-following analysis of current market action, but should not be used alone for short term trading. They are usually right, but they are often late.  They are most useful when they diverge from the Index.  In 2013, using these internals alone would have made a 16% return vs. 30% for the S&P 500 (in on Positive out on Negative – no shorting).  Of course, few trend-following systems will do well in an extreme low-volatility, straight-up year like 2013.
 
NTSM                                                            
The long-term NTSM system analysis remains BUY Tuesday.  Price and Volume indicators are positive. Others indicators are neutral.  This buy signal is not important now since a BUY signal was issued near the recent low in mid-October.

MY INVESTED STOCK POSITION                                         
I moved some funds back into the market on 17 October 2014 as a trade and increased my position in stocks from 30% to about 40% overall.  I added more 20 Oct, to bring my stock investments up to 50%. I am semi-retired, 50% is Fully-invested for me. I remain 50% invested in stocks.
                            --INDIVIDUAL STOCKS FROM A VALUE HOUND--
ENSCO (ESV): BUY
The chart looks good and oil prices are close to a bottom so I think Ensco is again a Buy. See related video on this page…
http://finance.yahoo.com/q?s=esv&ql=1
Ensco price is going to reflect oil prices.  If you think they are near a bottom, this is a great buy with high dividends. If not; it’s a dog. ESV fell again today with oil sliding...again.