“Today the Richmond Fed Manufacturing Composite Index
jumped to 16 for the month of April, up from last month's -3. Investing.com had
forecast 9.” – Jill Mislinsky. Story at…
Today’s value is considered “robust growth”.
RIDING THE BULL (Real Investment Advice)
“Wall Street is notorious for missing the major turning
of the markets and leaving investors scrambling for the exits. This time will
likely be no different. We remain “cautiously optimistic” and are
happy just “riding the bull” for now. As every good Texan knows,
all “bull riders” get thrown if they stay in the saddle too long. The
trick is to “hold on tight” with one hand and “dismount and run
for safety” when the buzzer sounds. The consequences of getting
thrown have not been kind.” – Lance Roberts. Commentary at…
TIME TO START HEDGING – CASH IS NO LONGER TRASH (Financial
Sense)
“Financial Sense Newshour’s Jim Puplava explains why it’s
time to start hedging your portfolio based on, as Don Coxe said earlier this
week on FS Insider, a “convergence of storm fronts,” including Fed rate hikes
and quantitative tightening, emerging market troubles, and a number of other
factors.” Click on the MP3 symbol at the following site to listen to the
commentary…
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 was down about 0.3% to 2724.
-VIX rose about 1% to 13.22.
-The yield on the 10-year Treasury slipped to 3.053%.
My daily sum of 17 Indicators rose from +2 to +3, while
the 10-day smoothed version remained +49.
Some indicators are turning more bearish: Up volume is
falling; Sentiment (%-bulls) is very high, but not yet issuing a sell signal; Money
Trend is flattening, but still up; Smart Money (late day action) is rolling
over and now is bearish; Breadth (10-dMA of advancing stocks) peaked and looks
like it may drop from here; RSI elevated though not yet a sell.
On the bull side: New-high/new-low data remains bullish;
charts look OK as long as the S&P 500 remains above around 2700 (That’s
below the 100-dMA, but 2700 is the line to watch); price action has looked good
and up-moves have exceeded down-moves over the last month; VIX continues to
fall and that’s bullish;
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…
TUESDAY 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: Tuesday, 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.
