“Federal Reserve Bank of Cleveland President Loretta
Mester said the economy is ripe for an interest-rate increase and repeated that
the Fed’s November meeting should be viewed as “live” for a policy decision,
despite its proximity to the U.S. presidential election. “I would expect that
the case would remain compelling…” Story at…
My cmt: She’s a non-voting member. No chance of a hike in my opinion.
PATIENCE (RAYMOND JAMES)
“It has been said if you don’t like the weather . . .
wait a minute. Recently, the same can be said about the stock market. I mean
really, here are the daily point gains and losses for the D-J Industrials over
the past two weeks: +200, -196, +111, +133, -167, -131, +99, +164, +10, -363.
Evidently Mr. Market has had a case of schizophrenia since mid-September. And
that, ladies and gentlemen, is why we have elected to have patience until our
models render a clear-cut direction for the equity markets in the short run.” -
Jeffrey Saut, Raymond James.
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 was down about 0.5% to 2150 at
the close.
-VIX rose about 0.4% to 13.63. (The options boys don’t
seem very worried.)
-The yield on the 10-year Treasury rose to 1.68%.
My daily sum of 16-indicators moved up and the 10-day
value jumped up too; that’s usually bullish. Otherwise, the short-term
indicators are mixed so my short-term outlook depends on tomorrow’s action. If
the Index drops from here I’ll be short-term bearish.
Long-term, I’m fully invested at 50% in stocks (a
conservative-retiree allocation) – that’s hold my nose bullish.
TRADING PORTFOLIO
2x S&P 500 ETF (SSO): Established Thursday, 22 Sep.
The short-term indicators are mixed, so tomorrow (Wednesday)
the S&P 500 must close higher or at the current level. Otherwise, I’ll take a small loss on this
position.
TUESDAY MARKET INTERNALS (NYSE DATA)
-10-day moving average of the percentage of stocks
advancing (NYSE): 52.4% (54.1% yesterday.) A number above 50% is usually BULLISH
for the markets short-term.
-150-day moving average of advancing stocks: 54.2%.
(A value above
50% indicates an up-trend.)
- McClellan Oscillator: improved from -7 to -31
(percentage calculation method).
- New-highs minus new-lows: +45 (It was +56 yesterday.)
-10-day moving average of the change in spread: +4.
In other words,
over the last 10-days, on average, the spread has increased by 4 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
Tuesday the Price indicator was bullish. Volume, VIX & Sentiment indicators were
neutral. Overall the long-term indicator remained HOLD.
MY INVESTED STOCK POSITION:
TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATION
I increased
stock allocation to 50% stocks in the S&P 500 Index fund (C-Fund) Friday, 23
Sep in my long-term accounts based on a number of indicators other than Long Term.
Remainder is 50% G-Fund. This is a conservative retiree allocation.
