Fewer Americans than forecast filed applications for unemployment benefits last week, indicating the U.S. job market remains healthy. Jobless claims fell by 4,000 to 262,000 in the week ended Aug. 13…” Story at…
http://www.bloomberg.com/news/articles/2016-08-18/jobless-claims-in-u-s-decreased-more-than-forecast-last-week
PHILADELPHIA FED (Yahoo Finance)
“Manufacturing activity in and near Philadelphia rebounded a bit in August, according to a survey conducted by the regional Federal Reserve. Its monthly index of current activity rose to 2.0 from -2.9 in July, in line with economists' consensus forecast.” Story at…
http://finance.yahoo.com/news/comes-philly-fed-120621533.html
LEI (Nasdaq)
"The U.S. LEI picked up again in July, suggesting moderate economic growth should continue through the end of 2016," said Ataman Ozyildirim, Director of Business Cycles and Growth Research at The Conference Board. "There may even be some moderate upside growth potential if recent improvements in manufacturing and construction are sustained, and average consumer expectations don't deteriorate further." - Conference Board Press Release at…http://www.nasdaq.com/article/press-release-the-conference-board-leading-economic-indexr-lei-for-the-us-increased-20160818-00514
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 was up about 0.2% to 2187.
-VIX dropped about 6% to 11.43.
-The yield on the 10-year Treasury dipped to 1.54%.
There doesn’t seem to be much help in the indicators; they are mixed and the markets continue to drift higher.
TICK (the sum of up vs down trades at the close) was a very high 785 today. The 10-dMA of closing Tick is above 300 and Tom McClellan has indicated that this is a sell signal. Up-volume has been trending down. If that trend continues a pullback will be sooner rather than later. In conclusion, someday in my lifetime there will be a short-term pullback. In the meantime, there is no down.
I was predicting that last week would be down; it was up 3pts., about 0.2%. Once again I predicted a down week – it’s looking doubtful now.
VXX TRADE:
Today, the calm-before-the-storm indicator (low standard of deviation in recent market moves) still remains down and that suggests that VXX remained a buy as of Thursday’s close.
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; Thursday it is still up slightly to nearly flat; a slightly bullish to neutral indication.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) rose to 55.6% Thursday and that gives another “overbought” indication on the Advance/Decline ratio. It was 54.3% Wednesday. A number above 50% is usually GOOD news for the markets.
On a longer term, the 150-day moving average of advancing stocks remained 54.8%. A value above 50% generally indicates an up-trend. The McClellan Oscillator improved from -24 to -5.
New-highs outpaced New-lows. The spread (new-highs minus new-lows) rose to +169 Thursday. (It was +73 Wednesday.) The 10-day moving average of the change in spread was zero. In other words, over the last 10-days, on average, the spread has remained unchanged 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
Thursday 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.
