“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.
JOBLESS CLAIMS (APNews)
“The number of Americans applying for unemployment
benefits rose last week to 744,000, signaling that many employers are still
cutting jobs even as more people are vaccinated against COVID-19, consumers
gain confidence and the government distributes aid throughout the economy.”
Story at...
WHY A PULLBACK MAY BE FAST APPROACHING (MarketWatch)
“As growth peaks over the next three months, we expect
discretionary investors to pare their positioning from extremely elevated levels,
and see retail investors as unlikely to buy the dip. Using the historical
experience as a guide argues for a near -6% pullback if growth flattens out
near the peak, a bigger -8.4% pullback on an inverted-V in growth,” said
strategists led by Binky Chadha. From there, though, equities may rally back...”
Story at...
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 5:00pm 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 0.4% to 4097.
-VIX dipped about 1% to 16.95.
-The yield on the 10-year
Treasury fell to 1.629%.
Bollinger Bands are very close
to overbought today and so is RSI. They are not overbought yet. The S&P 500
is 14.7% above its 200-dM. We seem to be nearing a short-term top. It doesn’t
feel like a major top. I worry about late summer or fall as a possible rally
end.
We are not at the upper trend
line yet. S&P 500 could reach the 4150
- 4200 zone if we continue to see good internals.
The daily sum of 20 Indicators
remained +10 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations improved from +18 to +36
(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 & Volume are bullish; Sentiment is
neutral.
I remain Bullish, but I will pay attention and consider
cutting stock allocation back to 50% if we see too many negative signs.
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 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 9 March, my
stock-allocation is about 60% invested in stocks. 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.
