“The rate of layoffs as measured by U.S. jobless claims
rose sharply in early March, just one week after dropping to the lowest level since
1969. Initial U.S. jobless claims rose by 21,000 to 231,000 in the seven days
ended March 3, the
government said Thursday. That’s the highest level in six weeks.”
Story at…
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 was Up about 0.5% to 2739.
-VIX was DOWN about 7% to 16.54.
-The yield on the 10-year Treasury was 2.857%.
Wash…rinse…repeat…Once again we saw a strong finish to
the day with strong, bullish, late-day action. Closing Tick (sum of last trades
of the day) was a very bullish +385. The pattern has repeated for the last
5-days with early weakness followed by late day strength. This suggests the
Pros are bullish.
This rally has been very unpopular with low volume. As I’ve
said before, volume is always low after a correction because investors are not
sure whether a correction is over, even as the Index rises. It seems like the
correction is over. Unfortunately, we never got a retest of the low (so far) on
a closing basis that would give us the data to make a more informed call. As it is, we do have the higher-low on 1
March that suggests that the correction is over, but I am still not sure. If it
is over, the correction lasted 10-days, top-to-bottom. That still seems impossibly small.
If we can break meaningfully above the 2750 region,
buying may accelerate. Before we get there, the Index must break above the
50-dMA. As of Thursday’s close, the Index is now essentially at its 50-dMA (2739).
It still needs to break above it before we feel more positive.
My sum of 17 Indicators improved from 0 to +3, a bullish
indication. The smoothed version has shifted and is now headed up too.
10-day Breadth climbed to 56% and that means over the
last 10-days, 56% of the stocks on the NYSE have moved up. That’s a nice sign
for the bulls.
New-high/new-low data looks bullish, too.
Repeating: I am still not sure where this market is going
in the short-run; but, I’ll be a seller of the S&P 500 drops much below 2725.
2725 is around the lower trend line of an up-trending
channel. I am guessing we’ve seen the low and the market is slowly
recovering. This tariff stuff is a
wild-card that could torpedo the recovery and send us back into correction.
TODAY’S 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%. 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)
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…
THURSDAY MARKET INTERNALS (NYSE DATA)
Market Internals
remained 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 VIX
indicator was negative; Volume, Sentiment and Price were neutral.
MY INVESTED STOCK POSITION:
TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATION
27 February, I
increased stock holdings from 40% to 50% with the remainder in a mix of stocks
and (mostly short-term) bonds. (A comparable TSP allocation would be 50% in the
S&P 500 Index fund (C-Fund) with the remainder 50% G-Fund (Government
securities). This is a conservative retiree position.
