“U.S. homebuilding increased to more than a one-year high
in January, boosted by a rebound in the construction of single-family housing
units, and further gains are likely as building permits soared to their highest
level since 2007.” Story at…
CONSUMER SENTIMENT (MarketWatch)
“The University of Michigan said its consumer-sentiment index
rose to a reading of 99.9 in February, up from 95.7 in January and
the second-highest level in 14 years.”
Story at…
MARKET REPORT / ANALYSIS
-Friday the S&P 500 was up about a point to 2732.
-VIX was down about 2% to 19.46.
-The yield on the 10-year Treasury slipped to 2.875%.
The S&P 500 is Sitting slightly (0.3%) above 50-dMA.
That’s not enough to say that the Index has broken thru its 50-dMA on the road
to recovery.
The S&P 500 remains down 4.9% from its recent high;
this is day 16 in the correction. If the bottom was 8 Feb (the recent low),
then this “correction” lasted 10-days top to bottom. A 2-week correction is awfully short and
difficult to believe.
My sum of 17 Indicators improved from 0 to +3 today – a bullish
indication. The smoothed version has turned up and is bullish too.
I’d be surprised if Indicators weren’t turning more
positive after the 5% bull move we’ve had this week. We still can’t guess
whether there will be a retest of the low...or not.
We’re still waiting, so to repeat: The S&P 500
remains in a zone that is critical. If the Index can move higher (or break
above Fibonacci resistance level for believers), a “V” correction is likely
with the Index making a quick recovery near the prior highs is more likely. If
not, the bounce may be over and the correction may look more like the typical
correction that includes a lot of choppiness after the bounce and a retest of
the recent low. We’ll see.
TODAY’S RANKING OF
15 ETFs (Ranked Daily)
In corrections
this chart may be less valuable – all stocks are falling.
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%. In 2017 Technology (XLK) was ranked in the top 3
Momentum Plays for 52% of all trading days in 2017 (if I counted correctly.)
XLK was up 35% on the year while the S&P 500 was up 18%.
*For additional background on the ETF ranking system see
NTSM Page at…
TODAY’S RANKING OF THE DOW 30 STOCKS (Ranked Daily)
In corrections
this chart may be less valuable – all stocks are falling.
The top ranked stock receives 100%. The rest are then
ranked based on their momentum relative to the leading stock.
*I rank the Dow 30 similarly to the ETF ranking system.
For more details, see NTSM Page at…
FRIDAY MARKET INTERNALS (NYSE DATA)
Market Internals were
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
Friday,
Sentiment, Price and VIX Indicators were negative; Volume was neutral.
MY INVESTED STOCK POSITION:
TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATION
I remain 40%
invested in stocks and 60% in cash as of 31 Jan or 50% in the S&P 500 Index
fund (C-Fund) with the remainder 50% G-Fund (Government securities). For none
Government employees holding short-term bonds would be OK rather than 60% cash.
