“U.S. housing starts plunged …Groundbreaking tumbled 17 percent to a seasonally adjusted annual pace of 897,000 units, the lowest level since January 2014, the Commerce Department said on Tuesday… We find it reasonable to excuse the bad news in the February data because of the unusually cold weather…” Story at…
http://www.reuters.com/article/2015/03/17/us-economy-housingstarts-idUSKBN0MD1FF20150317
BUILDING PERMITS UP (WSJ)
“…even though overall construction starts were down 3.3% in February from a year earlier, residential building permits were up 2% in the same span. Permits are a solid gauge of building activity in the near future, and they aren’t whipsawed as much each month by weather as are construction starts.” Story at…
http://blogs.wsj.com/developments/2015/03/17/let-building-permits-tell-tale-of-february-home-construction/
MARKET REPORT
- Tuesday, the S&P 500 was DOWN about 0.3% to 2074.
-VIX was up about 0.3% to 15.66.
-The yield on the 10-year Treasury Note dropped to 2.05%. (The Bond Ghouls don’t seem happy.)
PULLBACK OVER?
Probably, but the market seems to be waiting for the Fed. I am pretty sure the markets will rejoice if the word “patient” remains in the statement, i.e. the Fed will remain patient before raising rates. I am less sure what will happen if the Fed signals it is still on track to raise rates this summer. You’d think it would be a “so-what” moment.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) remained 46% at the close Tuesday. (A number below 50% is usually BAD news for the markets.) New-highs outpaced New-lows, Tuesday. The spread (new-highs minus new-lows) was +32. (It was +59 Friday.). The 10-day moving average of change in the spread was minus-6 In other words, over the last 10-days, on average; the spread has DECLINED by 6-each day.
Internals remained neutral on the market and up-volume (often an early mover in my basket of internals) is still the only positive internal (on a 10-day basis) that I track.
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 2014, using these internals alone would have made a 9% return vs.
13% 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, nearly straight-up year like 2014.
NTSM
Tuesday the NTSM analysis is BUY, but the important BUY signal was the day after the low in October. The VIX and PRICE indicators are positive. SENTIMENT and VOLUME indicators are neutral, although sentiment remains extremely high.
MY INVESTED STOCK POSITION
I remain fully invested at 50% invested in smaller cap-stocks
in the long-term portfolio with some international stocks. 50% is conservative,
but appropriate for a retired guy. The Dow Jones US Completion Index (all stocks except the S&P 500) continues to outperform the S&P 500. Since February it is 3.6% ahead of the S&P 500.
