Chart and commentary at…
As seen above, Margin Debt peaks with the market. Is this
the top? Unfortunately, the chart doesn’t answer that question.
RISING COSTS AND SUFFERING PROFIT MARGINS (Real
Investment Advice)
“The bottom line: Investors are paying too much for
stocks given slowing economic and corporate-profit growth, coupled with the
pressure of rising costs of all kinds.” – Doug Kass. Commentary at…
MARKET REPORT / ANALYSIS
-Monday the S&P 500 was up about 0.7% to 2733.
-VIX dropped about 3% to 13.08.
-The yield on the 10-year Treasury was unchanged at 3.060%.
My daily sum of 17 Indicators remained +2, while the
10-day smoothed version slipped from +50 to +49.
I remain bullish in the near term. I think we’ll make new
highs, but of course there are no guarantees.
Longer term, who knows? The bull could go for another year or so or end
tomorrow. We need to be vigilant.
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…
MONDAY 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: Monday, the VIX Indicator was positive; Price Volume and
Sentiment indicators were neutral. Overall this is a NEUTRAL indication.
