PRODUCER PRICE INDEX PPI
"The wholesale cost of U.S. goods and services rose
slightly in August, but inflation more broadly was still quite low and showed
little sign of stirring up any trouble for the U.S. economy.” Story at…
CRUDE INVENTORIES (OilPrice.com)
“Oil prices jumped higher after the Energy Information
Administration reported a draw in crude oil inventories of 6.9 million
barrels for the week to September 6.” Story at…
THE MYTH OF SEPTEMBER’S GLOOM (Heritage Capital)
“…since 1950, the S&P 500 averages a +0.40% return in
September when beginning in an uptrend versus -2.70% when starting in a
downtrend. That is significantly different and well worth noting where the
month is beginning. (Hat tip to one of my favorite research reads, Ari Wald
from Oppenheimer)” – Paul Schatz, President, Heritage Capital.
My cmt: The bottom of this pullback was 14 August, so this September, we started the month in an uptrend. No gloom here.
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 was up about 0.7% to 2979.
-VIX dipped about 4% to 14.61.
-The yield on the 10-year Treasury increased to 1.760%.
As I noted yesterday, “We have a spring (the S&P 500)
that is coiled for release. That release
will push the S&P 500 higher.” Today the move higher began and it should
continue, though not straight up.
My daily sum of 20 Indicators increased from +12
to +13 (a positive number is bullish; negatives are bearish) while the 10-day
smoothed version that negates the daily fluctuations improved from +24
to +50. (These numbers sometimes change after I post the blog based on data
that comes in late.)
I remain bullish.
TOP / BOTTOM INDICATOR SCALE OF 1 TO 10 (Zero is a
neutral reading.)
Today’s Reading: -1
-The Long-term Fosback Logic Index indicator was bearish,
but this indicator isn’t valid now because the McClellan Oscillator remains
positive.
- Most Recent Day with a value other than Zero: -1 on 11
September.
(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…
Over the last 2 months, Apple is the biggest gainer, up
almost 10%. Home Depot, currently tops in momentum is up a little over 7%.
WEDNESDAY MARKET INTERNALS (NYSE DATA)
Market Internals remained
POSITIVE 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 20 August 2019. This is a conservative balanced position
appropriate for a retiree.
INTERMEDIATE / LONG-TERM INDICATOR
Wednesday, the VOLUME indicator
was positive; VIX, SENTIMENT and PRICE Indicators were neutral. Overall, the
Long-Term Indicator remained to HOLD.
