“The rate of layoffs in the U.S.
rose in early May to a seven-week high, but the increase is probably tied to
seasonal swings in education-related employment.
Initial jobless claims rose by
11,000 to 234,000 in the week ended May 19…” Story at…
EXSTNG HOME SALES (Reuters)
“U.S. home sales dropped more than expected in April as a
shortage of properties for sale continued to weigh on the market. The National
Association of Realtors said on Thursday that existing home sales fell 2.5
percent…” Story at…
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 was down about 0.2% to 2728.
-VIX dipped about 0.4% to 12.53.
-The yield on the 10-year Treasury was little changed at
2.985%.
The S&P 500 dropped to its 100-dMA intra-day and
bounced up and made a recovery from there – it just couldn’t get back into positive
territory. The Index has been treading water for 2-weeks – now it’s time to
make a move. I think the move will be up. Let’s hope so because a drop below
the 100-dMA and the lower trend line around 2700 will probably bring on more
selling.
My daily sum of 17 Indicators remained -1, while the
10-day smoothed version slipped from +42 to +36. This is a mildly bearish
indication. My longer-term indicators are bullish.
I’m guarded in the near term. We need to see the market
hold the 2700 area; then I’ll feel more confident.
MOMENTUM ANALYSIS:
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. (On 5 Apr 2018 I
corrected a coding/graphing error that has consistently shown Nike
incorrectly.)
*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
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).
18 Apr 2018 I
increased stock investments from 35% to 50% based on the Intermediate/Long-Term
Indicator that turned positive on the 17th. (It has since turned Neutral.) For
me, fully invested is a balanced 50% stock portfolio. 50% is my minimum unless
I am in full defense mode.
On 10 May 2018 I
added stock positions to increase Stock investments to 58% based on more
evidence that the correction is over. I’ll sell these new positions quickly if
the market turns down.
INTERMEDIATE / LONG-TERM INDICATOR
Intermediate/Long-Term
Indicator: Thursday, the Price and VIX Indicators were positive; Volume and
Sentiment indicators were neutral. Overall this is a BULLISH indication, but I
don’t completely trust VIX at this point.
