“The number of Americans who applied for unemployment
benefits last week sank by 25,000 to 234,000, marking the second-lowest level
of the current economic expansion and reflecting a tight labor market in which
firms say it’s hard to find good help.” Story at…
INTERESTING CHART
Chart from Index Indicators at…
The S&P 500 is very near its 50-dMA so it’s not surprising
to see the % of stocks above the 50-dMA has been falling. The S&P 500 is
the worry though. If it falls below its 50-dMA it could be trouble for the
markets.
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 was up about 0.2% to 2357.
-VIX dropped about 4% to 12.43 near the close.
-The yield on the 10-year Treasury was up slightly to 2.339%.
XLI improved a bit compared to the S&P 500, but it is
still mostly down. Cyclical stocks usually lead the Index so this remains
bearish. The Advance-Decline Ratio (a measure of breadth) is again “overbought”
at today’s close, a bearish signal. Overall though, signals improved: My Sum of
16-Indicators was +4 today, up from 0 yesterday.
Bottom line: The S&P 500 is reaching a break point on
the charts. “Up” breaks the down-trend, “down” brings it close to or below the
50-dMA. We’ll see.
CURRENT RANKING OF 15 ETFs (Ranked Daily)
The top ranked ETF receives 100%. The rest are then
ranked based on their momentum relative to the leading ETF. While momentum isn’t stock performance per
se, momentum is closely related to stock performance. For example, over the 4-months
from Oct thru mid-February 2016, the number 1 ranked Financials (XLF) outperformed
the S&P 500 by nearly 20%.
*For additional background on the ETF ranking system see
NTSM Page at…
Utilities (XLU) and Emerging Markets (SCHE) were the only
losers on the day. I would avoid Energy (XLE); currently its 120-dMA is
declining.
1. Technology Select Sector SPDR ETF (XLK) remains the
top ranked ETF.
(I took positions in XLF and XLK Wednesday, 29 March.) My
guess is that XLF will rebound after a correction as the interest rates rise.
THURSDAY MARKET INTERNALS (NYSE DATA)
Market Internals switched
to Positive 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 Price indicator is positive; Sentiment,
Volume & VIX indicators were 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, 24
March 2017 in my long-term accounts, based on short-term indicators.
Remainder is 50% G-Fund (Government securities). This is a conservative retiree
allocation based mostly on low volume at the test of the 50-dMA.
