“U.S. commercial crude inventories fell by 2.5 million barrels in the week through Aug. 12 to a total of 521.1 million barrels, the U.S. Energy Information Administration reported.” Story at…
http://www.cnbc.com/2016/08/16/oil-prices-fall-on-doubts-that-producers-can-agree-output-restraint.html
FOMC MINUTES (US News)
“America's second interest rate hike in a decade could be right around the corner, as officials at the Federal Reserve appear to be in disagreement over the correct time for a boost. Minutes from the Federal Open Market Committee's July meeting in Washington…indicated that "some" of those at the meeting "judged that another increase in the federal funds rate was or would soon be warranted, with a couple of them advocating an increase at this meeting." Story at…
http://www.usnews.com/news/articles/2016-08-17/fed-minutes-show-rate-hike-momentum-as-september-meeting-looms
My cmt: Again? Same old story…
PULLBACK COMING (Real Investment Advice)
“…with the extension of the market now 7.5% above the 200-day moving average, a reversion at some point in the not-so-distant future becomes much more likely. This is particularly the case given the current overbought conditions combined with weakness in price momentum from high...” – Lance Roberts. Commentary at…
https://realinvestmentadvice.com/technically-speaking-a-bull-market-in-complacency/
My cmt: I agree, but I’ve predicted 10 of the last 5 pullbacks. Is that 200% accuracy?
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 was up about 0.2% to 2182.
-VIX dropped about 4% to 12.19.
-The yield on the 10-year Treasury dipped to 1.56%.
Bearish indicators: Bollinger Bands are tight; the Index is statistically calm; late day action is trending down; new-high/new-low data is showing signs of a bearish shift.
Bullish Indicators:
Money Trend is trending slowly upward (a bullish to neutral indication); new-highs are advancing; the size of up moves has outpaced down moves recently; the 10-day sum of 16-indicators improved from 31 to 41; however on a daily basis, the sum of 16-indicators dropped from 7 bullish to 4 bullish.
I was predicting that last week would be down; it was up 3pts., about 0.2%. Once again I’m predicting a down week. We’ll see.
VXX TRADE:
Today, the calm-before-the-storm indicator still remains down and that suggests that VXX remained a buy as of Wednesday’s close. Today, it looks like a one-day drop of around 1.5% would trigger a sell signal on the VXX trade.
SHORT TRADE
I am still holding short positions, but I will begin to pare the positions and transition into additional VXX positions.
MONEY TREND INDICATOR
My short-term Money Trend indicator can be volatile; Wednesday it is up slightly, nearly flat; a slightly bullish to neutral indication.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) dipped to 54.3% Wednesday. It was 55.8% Tuesday. A number above 50% is usually GOOD news for the markets.
On a longer term, the 150-day moving average of advancing stocks rose to 54.8%. A value above 50% generally indicates an up-trend. The McClellan Oscillator was essentially unchanged.
New-highs outpaced New-lows. The spread (new-highs minus new-lows) dropped to +73 Wednesday. (It was +103 Tuesday.) The 10-day moving average of the change in spread dropped to -1. In other words, over the last 10-days, on average, the spread has decreased by 1 each day. Market Internals remained neutral on the market.
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).
LONG TERM INDICATOR
Wednesday the VIX indicator was positive; Price, Sentiment & Volume indicators were neutral. The long-term indicator is HOLD.
MY INVESTED STOCK POSITION:
TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATIONOn 12 July I increased my invested position in my retirement account to 25% invested in stocks thru an S&P 500 Index fund (“C”-fund in the TSP). I added to that position Thursday 21 July bringing my invested total up to 40% in stocks. I expect to add more stocks should we get the anticipated pullback.
The NTSM system indicated Buy at the 11 Feb bottom; and again 2-days after the bottom on high up-volume; and from 22 Feb thru 25 April. I ignored the early signals convinced that it was a bear market bounce; I ignored more recent signals due to overbought conditions. I’m following my system now, especially since the Index has climbed above my initial sell-point of 2100 on the S&P 500 back in November 2015.
