NFIB SMALL BUSINESS OPTIMISM (Business Report)
“Optimism among America’s small business owners took a
modest downturn in June, according to the NFIB Small Business Optimism Index, slipping 1.7 points to
103.3.” Story at…
JOLTS JOB 0PENINGS (Reuters)
“After hitting an all-time high of 7.6 million in late
2018, job openings have been flat this year, suggesting some cooling in the
labor market… “The JOLTS report looks consistent with the idea that the labor
market is cooling somewhat but that it remains in solid shape,” said Daniel
Silver, an economist at JP Morgan in New York.”
Story at…
S&P 500 3000 REMAINS OUT OF REACH (Evil Speculator)
“Week #27 certainly lived up to its statistical promise
and painted a positive week. But unfortunately it failed in delivering us the
long coveted 3000 mark on the S&P 500. Which now may remain out of reach
for the foreseeable future as the summer vacation season between July and
August isn’t exactly famous for racking up record highs in equities.”
Commentary at….
BIG MOVE COMING – DON’T GO TO THE HAMPTONS (Heritage Capital)
“Semis have pulled back very nicely and orderly. They are
supposed to rally from here. Failure to do so would be a change of character
and warning that something is amiss…Transports are at an inflection point. A
close above last week’s high should send them on a run and provide some fuel
for the stock market to move higher. A move modestly lower could unleash a
summer selling wave of more than 10% which would almost certainly spillover
into the rest of the stock market.” - PAUL SCHATZ, PRESIDENT, HERITAGE CAPITAL
SELL STOCKS – MORGAN STANLEY (MarketWatch)
“Our call of the day though, kicks things off
with a warning from Morgan Stanley which is “putting our money where our mouth
is” and downgrading global equities to underweight from equal-weight. Here’s
why: ‘The most straightforward reason for the shift is simple—we project poor
returns,” said Andrew Sheets and a team of strategists.” Story at…
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 0.1% to 2980.
-VIX rose about 1% to 14.09.
-The yield on the 10-year Treasury rose to 2.068%.
It’s never a good sign when a firm as highly respected as
Morgan Stanley suggests cutting stock holdings. So far though, I don’t see much
reaction in the market. I think we’ll be headed higher soon. Looks like we
should be able to make the vicinity of 3100 to 3150 for the S&P 500.
Nothing is ever a sure thing…we’ll see.
My daily sum of 20 Indicators slipped from +3 to +2 (a
positive number is bullish; negatives are bearish) while the 10-day smoothed
version that negates the daily fluctuations improved from +1 to +7. (These
numbers sometimes change after I post the blog based on data that comes in
late.) Most of these indicators are short-term.
I remain bullish.
TOP / BOTTOM INDICATOR SCALE OF 1 TO 10 (Zero is a
neutral reading.)
Today’s Reading: 0
Most Recent Day with a value other than Zero: -1 on 3
July (Bollinger Band, top-indicator was bearish.)
(1) +10 Max Bullish / -10 Max Bearish)
(2) -4 or below is a Sell sign. +4 or better is a Buy
Sign.
MOMENTUM ANALYSIS:
TODAY’S RANKING OF
15 ETFs (Ranked Daily)
*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…
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).
Using the Short-term indicator in 2018 in SPY would have
made a 5% gain instead of a 6% loss for buy-and-hold. The methodology was Buy
on a POSITIVE indication and Sell on a NEGATIVE indication and stay out until
the next POSITIVE indication. The back-test included 13-buys and 13-sells, or a
trade every 2-weeks on average.
My current stock allocation is about 55% invested in stocks
as of 4 June 2019. This is based on the improved indicators 3 June and my
recommendation to increase stock holdings if we saw strong buying on 4 June. As
a retiree, I am conservatively positioned with a balanced portfolio. You may be comfortable with a higher % invested
in stocks – that’s OK.
INTERMEDIATE / LONG-TERM INDICATOR
Tuesday, the PRICE indicator was positive; the SENTIMENT,
VIX and VOLUME indicators were neutral. Overall the Long-Term Indicator slipped
to Neutral (Hold).
