“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
“In my decades of investing experience, I have not seen
such mindless and uninformed speculation as I have witnessed
recently. Indeed, in nominal dollar terms...it is far in excess of the
dot.com boom.” – Doug Cass.
“I never imagined that I would see the day that the
Chairman of the House Judiciary Committee would step forward to call for raw
court packing. It is a sign of our current political environment where rage
overwhelms reason.” - Professor Jonathan Turley, honorary Doctorate of Law from
John Marshall Law School for his contributions to civil liberties and the
public interest.
VA DEPT OF EDUCATION CONTESTS NEWS REPORTS ABOUT MATH
EQUITY PROPOSALS (Richmond Times Dispatch)
“Virginia Department of Education officials on Monday
defended the agency’s process in revising the mathematics Standards of Learning
and criticized news reports stating the agency planned to limit advanced math
class offerings in an effort to boost equity...Lane said agency officials are
weighing many shifts among routine draft revisions to state accountability
tests. ‘Absolutely acceleration is not going away in mathematics courses in
Virginia,’ he said. ‘If a student needs an accelerated pathway, they will
absolutely be able to do that.’ Story
at...
FOMC RATE DECISION (YahooFinance)
“The Federal Reserve on Wednesday said the vaccine
rollout has improved the U.S. economy, but still held interest rates at
near-zero as part of its commitment to aggressive economic stimulus...The Fed
said inflation has “risen” but attributed the higher readings to ‘transitory
factors...’ The Fed had described the economy as facing “considerable risks” in
its March meeting, but struck the word “considerable” in its updated statement.” Story
at...
https://finance.yahoo.com/news/fed-fomc-monetary-policy-decision-april-2021-135535532.html
GUNDLACH SAYS FED IS GUESSING THAT INFLATION WILL BE
TRANSITORY (Bloomberg)
“It is not clear that U.S. inflation will be ‘transitory’
as the Federal Reserve economists are trying to convey, according to Jeffrey
Gundlach. ‘I’m not sure why they think they know that it’s transitory,’
Gundlach of DoubleLine Capital LP said in an interview with BNN
Bloomberg Tuesday. ‘How do they know that when there’s plenty of money printing
that’s been going on and we’ve seen commodity prices going up really massively.’”
Story at...
EIA CRUDE INVENTORIES (Energy Information Administration)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 0.1 million barrels from the previous
week. At 493.1 million barrels, U.S. crude oil inventories are at the five-year
average for this time of year.” Press release at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 5:30pm Wednesday. 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
-Wednesday the S&P 500
slipped about 0.1% to 4183.
-VIX slipped about 1.6% to 17.28.
-The yield on the 10-year
Treasury slipped to 1.614%.
In the last 9 trading-days, the S&P 500 has improved by
0.25% in choppy trading, i.e., it has nearly stalled. That’s a bad sign for the Bulls. A pullback
is overdue, but not guaranteed. Indicators have been neutral to bullish over
the last week or so, and internals were negative last week
The daily sum of 20 Indicators
declined from +8 to +5 (a positive number is bullish; negatives are bearish);
the 10-day smoothed sum that smooths the daily fluctuations improved from +14
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 and many are trend
following.
The Long Term NTSM indicator
ensemble remained BUY. Price & VIX are bullish; Volume & Sentiment are
neutral. This indicator can be slow to turn.
I have been saying, “We are getting close to a pullback
of some kind.” I suspect that it is here, but it didn’t surprise me that the
Index made a new-high Monday. I just
don’t expect it to get too much higher.
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
40 DAY GAINS OF THE ETFs
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
40 DAY GAINS OF THE DOW 30
WEDNESDAY MARKET INTERNALS
(NYSE DATA)
Market Internals remained BULLISH 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.
As of 19 April, my
stock-allocation is about 40% invested in stocks. I hadn’t intended to drop
this low, but I took profits in both Boeing and Intel due to their dropping out
of the top 3 in momentum.
You may wish to have a higher
or lower % invested in stocks depending on your risk tolerance. 50% is a
conservative position that I consider fully invested for most retirees. 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, and I can call a bottom, 80% would not be out
of the question.
The markets have not
retested the lows on recent corrections and that left me under-invested on the
bounces. I will need to put less reliance on retests in the future.
