“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“The big money is not in the buying and selling. But in
the waiting.” - Charlie Munger, Vice Chairman, Berkshire Hathaway
"The
extent to which the president, President Trump, for months leading up to
January 6 spread the notion that the election had been stolen or that the
election was rigged was a lie and people need to understand that. We need to
make sure that we as Republicans are the party of truth that we are being
honest about what really did happen in 2020..." - Liz
Cheney, US Republican Representative, Wyoming.
“January 6 is going to leave a scar. For 220 years one of
the most beautiful things about America has been a peaceful transfer of power.
But what we saw three weeks ago was ugly, shameful mob violence to disrupt a
Constitutionally-mandated meeting of Congress to affirm that peaceful transfer
of power...It happened because the president lied to you. He lied about the
election results for 60 days. Despite losing 60 straight court challenges, many
of them handed down by Trump-appointed judges...He lied by saying the vice
president could violate his constitutional oath and declare a new winner. That
wasn't true.” - Ben Sasse, US Republican Senator, Nebraska.
This country was founded by the bayonet; it survives by the ballot. Those who falsely disparage the honesty of our elections are striking a blow at the foundations of our nation and should be charged with sedition. – Meade Stith
JOBLESS CLAIMS (YahooFinance)
“New weekly unemployment claims pulled back slightly but held
at elevated levels last week... Initial jobless claims, week ended Feb. 6: 793,000
vs. 760,000 expected... Continuing claims, week ended Jan. 30: 4.545
million vs. 4.420 million..." Story at...
I WAS WRONG - Excerpt (Heritage Capital)
“As you know, my thesis has been for an absolute minimum
4-8% pullback in Q1...Well, Mr. Market gave us the bare minimum 4%
decline, but not only did it not repair anything, it has actually made the
landscape even worse...The bulls continue to punish anyone and everyone that
fights the trend. That’s what happens when the Fed and Treasury go all in.
Small caps, one of the themes for 2021, seem to have awoken over the past week,
but I have a very tough time chasing that group higher. Rather, I preferred to
look at the gold stocks late last week.” – Paul Schatz, President, Heritage
Capital. Commentary at...
https://investfortomorrow.com/blog/its-confirmed-i-was-wrong/
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 6:00pm Thursday. US total case numbers are on the left axis; daily numbers
are on the right side of the graph with the 10-dMA of daily numbers in Green.
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 rose
about 0.2% to 3916.
-VIX dipped about 3% to 21.25.
-The yield on the 10-year
Treasury rose to 1.167%.
the S&P 500 made another
all-time new-high today. Breadth was about average today, so that’s good for
the bulls.
Rydex Sentiment flipped back to a more bullish position yesterday
as traders got more bullish again. We still have at least one significant bear
sign.
The S&P 500 remained 15.3% above its 200-dMA (Sell
point is 12%.); when Sentiment is considered, the signal is also bearish.
Markets are ignoring this stat, so we may as well ignore it too, for the time
being.
I still don’t see many top Indicators warning of a top –
only the % above the 200-dMA. Since the markets had been ignoring that
indicator, it looks like we can go higher.
The daily sum of 20 Indicators remained +1 (a positive
number is bullish; negatives are bearish); but the 10-day smoothed sum that
smooths the daily fluctuations improved from -28 to -15 (These numbers
sometimes change after I post the blog based on data that comes in late.) Most
of these indicators are short-term and many are trend following.
The Long Term NTSM indicator
ensemble remained HOLD. Volume is Bullish; VIX, Sentiment & Price
are neutral.
It does feel like we might see
a dip greater than the 3% dip that occurred when the Index dropped to the
50-dMA not long ago. At this point, indicators aren’t confirming the “feel” so
it is just a guess. I have no guess when this pullback might begin, but as
others have pointed out, February and March have been bad months in the last 2
years.
I am still conservatively positioned, but I did add the
XLE-ETF 10 Feb. I won’t rush to add more
stocks.
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.
*For additional background on
the ETF ranking system see NTSM Page at…
http://navigatethestockmarket.blogspot.com/p/exchange-traded-funds-etf-ranking.html
TODAY’S RANKING OF THE DOW 30
STOCKS (Ranked Daily)
Here’s the revised DOW 30 and
its momentum analysis. 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…
https://navigatethestockmarket.blogspot.com/p/a-system-for-trading-dow-30-stocks-my_8.html
THURSDAY 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.
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. You may wish to have a higher or lower % invested
in stocks depending on your risk tolerance. 40% is a conservative position that
I re-evaluate daily.
The markets have not
retested the lows on recent corrections and that has left me under-invested on
the bounces. I will need to put less reliance on retests in the future.
As a retiree, 50% in the stock
market is about fully invested for me – it is a cautious and conservative
number. If I feel very confident, I might go to 60%; if a correction is deep
enough, 80% would not be out of the question.
