“Overall business activity in Texas turned positive
in November for the first time since December 2014, according to the Dallas
Federal Reserve.
In the first monthly survey since the US election, the
headline index that gauges general activity in the sector jumped to 10.2.”
Story at…
REGIONAL FED MANUFACTURING (dshort.com)
Charts with commentary at…
No recession in sight with manufacturing on the rise.
WHY THE POLLS GOT IT WRONG (Financial Sense)
My cmt: I won’t include any of the piece here. It covers
polling bias, accidental and intentional. You can read it at Financial Sense.
Actually, I think the Polls got it right. By that I mean they accurately gave
public opinion at the time of the survey. The problem was that there was a
large block of voters who told pollsters they were going to vote for Governor
Gary Johnson on the Libertarian ticket (13% in late July) Even on Election Day
it appeared that Johnson was going to receive well in excess of 5% of the popular
vote based on the polling – that was a critical number to insure Libertarians
would have Federal funding for the next election. Those voters bailed on
Johnson at the last minute. No
Libertarian leaning voter would vote with the Democrats, so Trump was the
recipient of an extreme last minute shift. It had to be a big factor and
perhaps THE factor that tripped up the Pollsters.
COMMENTARY FROM JEFFREY SAUT (Raymond James)
“Look for a short-term trading peak in this overbought
market that sets the stage for the fabled Santa Claus rally.” Commentary at…
COMMENTARY FROM JOHN HUSSMAN PhD (Hussman Funds)
“Our assertion is not that stocks will immediately
collapse from present extremes. Rather, our assertion is simply that we
presently identify a negative expected near-term market return/risk
profile based on our classification of observable data, in the context of
extreme valuations that also have unfavorable long-term implications…
Are we pounding the table about a collapse? No; we’d look for even greater
internal deterioration first. Near-term, we’re more inclined to expect an
air-pocket than a crash.” – John Hussman, PhD. Weekley Market Commentary at…
MARKET REPORT / ANALYSIS
-Monday the S&P 500 was down about 0.5% to 2201 at
the close.
-VIX was up about 7% to 13.15 at the close.
-The yield on the 10-year Treasury slipped to 2.32%.
Short-term I am getting more bearish. My Money trend
indicator and the SUM of 16-Indicators are pointing down. RSI dropped to 80,
but it was 92 last week so RSI is bearish. The Advance-Decline ratio remains
overbought and that’s bearish.
Long-term I’m fully invested at 50% in stocks (a conservative-retiree
allocation) – I remain “hold-my-nose” bullish.
For now I think the long-term trend remains up.
TRADING PORTFOLIO (Small-% of the total portfolio)*
2x S&P 500 ETF (SSO) Established 15 Nov. SOLD 22 Nov.
Gain: +2.3%
NET: +8.2%
*I am not really happy doing this much trading, but I
need to rebuild the trading balance after holding my shorts too long after the
February correction. (I really should
follow my own indicators. My system is smarter than I am!)
MONDAY MARKET INTERNALS (NYSE DATA)
-10-day moving average of the percentage of stocks
advancing (NYSE): 57.1 %. (59.1 % yesterday.) A number above 50% is usually
BULLISH for the markets short-term.
-150-day moving average of advancing stocks: dipped to
52.4%. (A value above 50% indicates a long-term, up-trend.)
-McClellan Oscillator: fell to +105 (percentage
calculation method adjusted to fit McClellan’s values).
-New-highs minus new-lows: +120 (It was +206 yesterday.)
-10-day moving average of the change in spread: +8. In
other words, over the last 10-days, on average, the spread has increased by 8
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
Monday the Sentiment, Volume and VIX indicators were
neutral. The Price indicator was positive. Overall the long-term indicator
remained Neutral.
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 2016 in my long-term accounts. Remainder is 50% G-Fund.
This is a conservative retiree allocation.
