PAYROLL REPORT
Nonfarm payrolls grew far more than expected in February
as companies continued to hire leading into a growing coronavirus scare.
The Labor Department reported Friday that the U.S.
economy added 273,000 new jobs during the month…” Story at…
AVERAGE WORKWEEK (CNBC)
“Average hourly earnings grew by 3% over the past year,
in line with estimates, while the average work week, considered a key measure
of productivity, nudge up to 34.4 hours.” Story at…
COVID19 HAS BEEN CIRCULATING FOR MONTHS (CNBC)
“…one of the reasons we’re seeing these hot spots pop up
around the country is because we simply didn’t know this had already hit our
shores,” she told CNBC, adding that cases will rise as testing is expanded and
labs discover new cases that were previously hidden. “I do think that this
virus has been circulating now for several weeks in the U.S. ... Until now,
it’s been circulating unchecked.” Story at…
BLOOMBERG COULD HAVE GIVEN A MILLION TO EVERYONE (ZeroHedge)
“During a Thursday discussion over the amount of money
Mike Bloomberg has spent on advertising during the 2020 election - some $500
million, MSNBC's
Brian Williams and New York Times editorial board member Mara
Gay promoted a Twitter user's very incorrect math…MSNBC’s Brian Williams
reads a tweet: "Bloomberg spent $500 million on ads. U.S. Population, 327
million. He could have given each American $1 million" NYT Editorial Board
Member Mara Gay: “It’s an incredible way of putting it. It’s true. It’s
disturbing”
Story at…
Story at…
https://www.zerohedge.com/political/liberal-math-msnbcs-brian-williams-ny-times-editor-think-bloomberg-could-have-given-every
My cmt: My God. This is insane. This made it through the MSNBC producers and their graphics Dept. and was discussed on the show! The US population is about 300-million. Thus, if Bloomberg distributed his money to everyone in the US, the real amount would be less than $1.75 per person. Those MSNBC folks must be suffering from Trumponavirus2016.
My cmt: My God. This is insane. This made it through the MSNBC producers and their graphics Dept. and was discussed on the show! The US population is about 300-million. Thus, if Bloomberg distributed his money to everyone in the US, the real amount would be less than $1.75 per person. Those MSNBC folks must be suffering from Trumponavirus2016.
MARKET REPORT / ANALYSIS
-Friday the S&P 500 fell about 1.7% to 2972. (There
was a positive move late-day, so let’s see if it carries forward into next
week.)
-VIX rose about 6% to 41.94.
-The yield on the 10-year Treasury slipped to 0.767.
It’s Friday, so it’s time for a run-down of Bull/Bear
signs:
BEAR SIGNS
-Cyclical Industrials are underperforming the S&P 500
suggesting investors are worried.
-The 5-10-20 Timer is SELL, because the 5-dEMA and the
10-dEMA are below the 20-dEMA.
-Statistically, the S&P 500 is bearish due to several
panic-signals.
-VIX jumped sharply higher when the correction started
and is still giving a bearish signal.
-MACD of stocks advancing on the NYSE (breadth) made a
bearish crossover 21 Feb.
-MACD of S&P 500 price made a bearish crossover 21
Feb.
-New-high/new-low data is falling.
-We’ve seen multiple 90% down-volume days during this
selloff. According to Lowry Research, “…our
69-year record shows that declines containing two or more 90% Downside Days
usually persist, on a trend basis, until investors eventually come rushing back
in to snap up what they perceive to be the bargains of the decade…” The rush
back is signaled by a 90% up-volume day.
-The size of down-moves has been larger than the size of
up-moves over the last month.
-XLU has been outperforming the S&P 500 index. Even
today, XLU fell half of the S&P 500 decline.
NEUTRAL
-The S&P 500 is no longer too far above its 200-dMA.
It’s closer to a buy signal now; but it remains neutral.
-The Fosback High-Low Logic Index is neutral.
-Sentiment is elevated, but it is not giving a sell
signal. I have been surprised that Sentiment has remained so bullish during
this downturn.
Breadth on the NYSE vs the S&P 500 index remains in
neutral territory.
-Bollinger Bands are in neutral territory.
BULL SIGNS
-Overbought/Oversold Index, a measure of advance-decline
data, is oversold. (This indicator isn’t followed much anymore.)
-RSI is oversold.
-The Smart Money (late-day-action) is oversold.
-The smart money is buying, but the amounts have been
limited. This is typical though; the Pros start buying near the bottom, not at
the bottom.
-Money Trend turned up today, but just barely. We’ll have
to see if this trend continues.
-Over the last 20 days, there have only been 7
up-days. That’s a bullish, oversold
sign.
Overall, the daily sum of 20 Indicators improved
from -11 to -6 (a positive number is bullish; negatives are bearish). The 10-day
smoothed sum that negates the daily fluctuations improved from -115 to
-114. (These numbers sometimes change after I post the blog based on data that
comes in late.) Most of these indicators are short-term. We saw some
improvement; but not much!
The 10-year Treasury Bond is now yielding 0.767%. It’s
not one of my indicators, but maybe it should be. The Bond market is calling for a crash.
My expectation remains that stock markets will retest the
lows. We almost tested the prior low today, but we finished higher so it wasn’t
a test. Had it finished lower; it would
not have been a successful test. Either way, it appears that the bottom is not
in yet.
The “average” correction has been 12% since 2009. In the
past 15 years or so, corrections greater than 10% have lasted 68 days top to
bottom.
We’re at day 12 and the S&P 500 is now 12.2% from its
all-time top, on 19 Feb. It is 2.6% below its 200-dMA.
The next support level is the 8 October low: 2893 and
2850 may be a better level of support.
We’ve seen improvement, but no bottom yet. The bottom
could be near, but we won’t know until we get a retest at a level below the
prior low.
TOP / BOTTOM INDICATOR SCALE OF 1 TO 10 (Zero is a
neutral reading.)
Today’s Reading: +2
Most Recent Day with a value other than Zero: +2 on 6
March. (RSI and Smart Money (late-day-action) are oversold.)
(1) +10 Max Bullish / -10 Max Bearish)
(2) -4 or below is a Sell sign. +4 or higher is a Buy
Sign.
MOMENTUM ANALYSIS:
CAUTION: Momentum is not a good tool during market
declines.
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…
FRIDAY MARKET INTERNALS (NYSE DATA)
Market Internals improved
to 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 40% invested in
stocks as of 3 March. (I previously dropped stock allocations to 45% on 27
January). You may wish to have a higher or lower % invested in stocks depending
on your risk tolerance.
INTERMEDIATE / LONG-TERM INDICATOR
Friday, the VOLUME and VIX gave bear signals; The SENTIMENT
and PRICE Indicators were neutral. The Long-Term Indicator remained SELL. I suspect that it is too
late to sell now. We are closer to a
bottom than a top.
