“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
MARKET RALLIES AS BULLISH REND CONTINUES (Real Investment
Advice, Friday morning commentary)
“While the market continues its bullish advance (why
not with $120b in QE), the divergences between price and other internal
indicators continue to diverge. Another trip to the 50-dma would be a near
3% crash, and a decline in the 200-dma (which hasn’t happened for one of the
longest spans in 40-years) would be a 10% disaster. (While I
am sarcastic, the low volatility market experienced this year will make
even normal corrections seem much worse than they are.) For now,
the ‘stair-step’ process continues with bounces off the 50-dma to
slightly new highs before the next decline. At some point, investors will slip
and fall down the stairs.” – Lance Roberts. Commentary at...
https://realinvestmentadvice.com/fed-says-taper-is-coming-bulls-hear-no-taper-now-08-27-21/
WHAT INSURRECTION? (Jonathon Turley)
“Many in the media continue to awkwardly refer to
“the insurrectionists” rather than the rioters. National Public Radio even
ran a running account of the “Capitol
Insurrection.” The term was further driven home by House Democrats by
impeaching President Trump for “incitement to insurrection” despite undermining any chance for an actual conviction. Members of
Congress like Eric Swalwell (D-Calif.) are still in federal court claiming
a conspiracy of “armed and organized insurrectionists.”
...Despite the adoption of the term by many in the media,
there has been a growing disconnect with the actual cases in court. Indeed, a
new report from Reuters disclosed that the FBI has struggled to support
the account of a coordinated “insurrection” on Jan. 6. Reuters’ FBI
sources said that, despite months of intense investigation, they could
find “scant evidence” of any “organized plot” and instead found that
virtually all of the cases are “one-offs.”
...After five months of dragnet arrests nationwide,
a few reporters noted that no one was actually charged
with insurrection or sedition. The vast majority of people face charges
like simple trespass...Yet, the characterization of the “insurrection” has
continued as a virtual article of faith for those reporting on or writing about
Jan. 6.” - Professor Jonathan Turley, honorary Doctorate of Law from John
Marshall Law School for his contributions to civil liberties and the public
interest. Commentary at...
My cmt: As regular readers know, even though I voted for
him, I now have no respect for Trump for what he has done after the 2020 election. I just thought
this was an interesting piece on media bias.
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 5:30 PM Monday. U.S. total case numbers are on the left axis; daily numbers
are on the right side of the graph in Red with the 10-dMA of daily numbers in
Green.
Friday’s numbers were apparently not a typo, however, it
is still likely that a lot of the extreme, high number of new-cases reported on
Friday was due to “catch-up” reporting. Numbers were low over the weekend, as
is often the case. As expected, they too, played catch up today – today’s
number was over 200,000 new cases. The
10-dMA is now about 160,000 new cases per day. That’s still scary high.
It hasn’t been widely reported, but vaccines do not
provide mucosal immunity. That means
that vaccinated persons can carry and transmit Covid in the sinus and throat
while experiencing mild symptoms. The good news just keeps on coming! (sarcasm)
Bio companies are working hard on a nasal spray vaccine that will solve this problem.
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.4% to 4529.
-VIX slipped about 1% to 16.19.
-The yield on the 10-year Treasury slipped to 1.269%.
Bollinger Bands were overbought today, but there were only
2 other Topping Indicators flashing a warning.
I’d need to see more indicators warn before I would be tempted to call a
top. Topping Indicators currently warning are: (1) Bollinger Bands; (2) Breadth
vs. the S&P 500; (3) Money Trend Spread -advancing $ vs the S&P 500.
The daily sum of 20 Indicators improved from zero to +1
(a positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations improved from -71 to -68. (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. Price, Volume, VIX & Sentiment indicators are
neutral.
Friday was a statistically significant up-day, so I still
expect Tuesday will be down since today was up again. Futures do not agree;
they are slightly up as I write this.
I moved my stock allocation
back to 50% today, Monday. I am
cautiously bullish. A top is coming, but
not THE TOP.
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
MONDAY MARKET INTERNALS (NYSE
DATA)
Market Internals improved to 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.
My stock-allocation is now about
50% invested in stocks; this is my “normal” 50% allocation.
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.
