“The S&P 500 (SPX/2786.57) has traveled back to its
February 27, 2018 intraday high of 2789.15, which was where our short-term
model “said” would be a near-term top a few weeks ago. At the time the stock
market’s internal energy was totally used-up and needed to be rebuilt. That is
not the case currently. The market’s energy now has a full charge and both the
short and intermediate-term models suggest the SPX should blow through the
February 27 intraday high. If that happens there is a good chance we will break
out to new all-time highs.” – Jeffrey Saut. Commentary at…
MARKET REPORT / ANALYSIS
-Monday the S&P 500 was Down about 0.1% to 2783.
-VIX was UP about 8% to 15.78. (The Options Boys may be
worried that the markets will cave from here.)
-The yield on the 10-year Treasury slipped to 2.867%.
My sum of 17 Indicators dropped from +4 to +0 and the
smoothed version reversed and fell too.
10-day Breadth slipped to 54%; that means over the last
10-days, 54% of the stocks on the NYSE have moved up and that’s still a
positive sign.
Some negative signs remain from Friday:
-Bollinger Bands are nearly giving an “overbought” sign,
but RSI is not. I usually like to
consider these two indicators in tandem.
The don’t agree so I am not worried.
-New-Highs are still falling when measured on a long-term
basis. Usually, this indicator bottoms when the S&P 500 makes a bottom so
it’s a worry that it is falling.
The big news today may be the action behind the
price: 59% of the volume was up; 55% of stocks on the NYSE advanced; 148 stocks
made new-highs while only 25 made new-lows on a 52-week basis. Those are bullish numbers that usually
carryover until the next day.
Overall, we have a mixed report. Indicators turned down,
but were neutral while the daily numbers looked pretty good. We’ll have to wait
for more info. The concern now is that
this correction may not be over and it could retreat back to retest the bottom.
My guess is, that won’t happen.
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…
MONDAY MARKET INTERNALS (NYSE DATA)
Market Internals switched
to 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 VIX indicator
was negative; Price was positive; Sentiment and Volume 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.
