HALF OF CHINA LOCKED DOWN / TOKYO CASES SPIKE (MishTalk)
“…at least 760 million people are Locked Down in China according to
a New York Times analysis of government announcements in provinces and major
cities. That's more than half the country’s population…[In Tokyo] A sudden
spike in new coronavirus cases was confirmed among attendees at a New Year's
party for independent taxi drivers…The Tokyo Metropolitan Government says the
virus may be spreading in the capital, as people not at the party -- including
an office worker and a chauffeur -- were also confirmed infected.” Story at…
My cmt: The party of taxi drivers was a month ago and an
attendee had COVID-19. This sounds like a Hollywood thriller. Taxi drivers?!
Could there be a better way to transmit this disease around the city?
APPLE INVESTOR UPDATE ON QUARTERLY GUIDANCE (Nasdaq)
“As the public health response to COVID-19 continues, our
thoughts remain with the communities and individuals most deeply affected by
the disease, and with those working around the clock to contain its spread and
to treat the ill…we do not expect to meet the revenue guidance we provided for
the March quarter due to two main factors. The first is that worldwide iPhone®
supply will be temporarily constrained. While our iPhone manufacturing partner
sites are located outside the Hubei province — and while all of these
facilities have reopened — they are ramping up more slowly than we had
anticipated…The second is that demand for our products within China has been
affected.” Press release at…
EMPIRE STATE MANUFACTURING (MarketWatch)
“The New York Federal Reserve’s Empire State business
conditions index rose 8.1 points to 12.9 in February, the bank said Tuesday. This is the highest level
since last May.” Story at…
CORONAVIRUS COULD IMPACT 5 MILLION BUSINESSES (CNBC)
“The new coronavirus outbreak and subsequent
shutdown of huge swathes of China could impact more than 5
million businesses worldwide, according to a new study…Dun & Bradstreet
researchers found that at least 51,000 companies worldwide, 163 of which are in
the Fortune 1000, have one or more direct or “tier 1” suppliers in the impacted
region, while at least 5 million — and 938 in the Fortune 1000 — have one or
more “tier 2″ suppliers.” Story at…
My cmt: Still, the general feeling of investors is that
there will be no lasting impact, so why worry? Apparently, only Apple will be
affected.
LARRY ADAM COMMENTARY EXCERPT (Raymond James)
“The current equity bull market (i.e., rally
uninterrupted by a 20%+ decline) is the second longest in history and has been
one of the most powerful. Since its inception (March 9, 2009), the S&P 500
has rallied 526%, ‘treating’ investors to annualized performance of 18.3%. But
despite this performance, the rally has been ‘unloved’ by investors…The lack of
unrelenting ‘affection’ for equities has historically been a positive and
supports our belief this bull market will continue.” Story at…
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 slipped about 0.3% to 3370.
-VIX rose about 8% to 14.83.
-The yield on the 10-year Treasury slipped to 1.562.
Overall, we see the following…
The daily sum of 20 Indicators declined from +3 to
zero (a positive number is bullish; negatives are bearish). The 10-day smoothed
sum that negates the daily fluctuations improved from +4 to +17. (These
numbers sometimes change after I post the blog based on data that comes in
late.) Most of these indicators are short-term.
Not much change, overall: Based on the overstretched
S&P 500, I am still expecting another dip – not huge, but perhaps in the
5-10% zone. (It could always be worse if we get bad news.) On the other hand,
the Index may continue to climb until we see RSI and Bollinger Bands give
negative signs – that may not take too long. We’ll see.
TOP / BOTTOM INDICATOR SCALE OF 1 TO 10 (Zero is a
neutral reading.)
Today’s Reading: -1
Most Recent Day with a value other than Zero: -1 on 18
February (The S&P 500 was too far above its 200-dMA when sentiment is
considered.) Even without sentiment, the S&P 500 is 11.1% above its
200-dMA – that’s high too.
(1) +10 Max Bullish / -10 Max Bearish)
(2) -4 or below is a Sell sign. +4 or higher 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.
For more details, see NTSM Page at…
TUESDAY MARKET INTERNALS (NYSE DATA)
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 45% invested in
stocks as of 27 January (down from 60%). This is a conservative position appropriate
for a retiree based on an overstretched S&P 500. You may wish to have a
higher or lower % invested in stocks depending on your risk tolerance.
INTERMEDIATE / LONG-TERM INDICATOR
Tuesday, the VOLUME indicator is bullish; VIX, PRICE, and
SENTIMENT Indicators were neutral. The Long-Term Indicator is HOLD.
