“People always ask me what is going on in the markets. It
is simple. Greatest Speculative Bubble of All Time in All Things. By two orders
of magnitude.” – Michael “Big Short” Burry.
"If I was Darth Vader and I wanted to destroy the US
economy, I would do aggressive spending in the middle of an already hot
economy...This is the biggest bubble I've seen in my career." - Stanley
Druckenmiller, billionaire investor.
PAYROLL REPORT / (CNBC)
“Initial filings for unemployment insurance fell last
week to their lowest levels since March 2020 in another sign that the labor
market is gradually improving from the Covid-19 era, the Labor Department
reported Thursday. First-time jobless claims totaled 340,000 for the week ended
Aug. 28... The level of continuing claims, the measure of ongoing benefits, was
2.75 million, a decrease of 160,000...” Story at...
https://www.cnbc.com/2021/09/02/us-weekly-jobless-claims.html
PAYROLL REPORT / UNEMPLOYMENT RATE (YahooFinance)
“The U.S. economy
added back jobs at a far slower pace in August following an
early-summer jump in employment, as an initial wave of reopening hiring waned
and concerns over the Delta variant increased.
-Change in non-farm payrolls: +235,000 vs.
+733,000 expected and a revised +1.053 million in July
-Unemployment rate, August: 5.2% vs.
5.2% expected and 5.4% in July...” Story at...
ISM NON-MANUFACTURING INDEX (ISM via prnewswire)
"According to the Services PMI®, 17 services
industries reported growth. The composite index indicated growth for the 15th
consecutive month after a two-month contraction in April and May 2020. There was a pullback in the rate of expansion
in the month of August; however, growth remains strong for the services sector.
The tight labor market, materials shortages, inflation and logistics issues
continue to cause capacity constraints," Press release at...
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 9:00 PM Friday. 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.
Same as yesterday, the smoothed 10-dMA of new cases rose
to a new-high of over 160,000 cases today.
US numbers continue to climb sharply.
MARKET REPORT / ANALYSIS
-Friday the S&P 500 was down about 2pts to 4535.
-VIX was unchanged at 16.41.
-The yield on the 10-year Treasury rose to 1.326%.
The Friday run-down of some important indicators remains
on the Bull side (5-bear and 14-bull) – a good sign for the bulls. These
indicators tend to be both long-term and short-term, so they are different than
the 20 that I report on daily. Details follow:
BULL SIGNS
-The 10-dMA % of issues advancing on the NYSE
(Breadth) is above 50%.
-The 50-dMA % of issues advancing on the NYSE (Breadth)
is above 50%.
-The 100-dMA of the % of issues advancing on the
NYSE (Breadth) is above 50%.
-The 5-10-20 Timer System is BUY; the 5-dEMA and 10-dEMA are
both above the 20-dEMA.
-MACD of S&P 500 price made a bullish crossover, 25
August.
-McClellan Oscillator.
-The smoothed advancing volume on the NYSE is rising.
-MACD of the percentage of issues advancing on the NYSE
(breadth) made a bullish crossover 27 August.
-Short-term new-high/new-low data is rising.
-Long-term new-high/new-low data is rising.
-My Money Trend indicator.
-There was a Follow-thru day on 27 Aug. This cancels any prior Distribution days.
-Slope of the 40-dMA of New-highs is up. This is one of
my favorite trend indicators.
-59% of the 15-ETFs that I track have been up over the
last 10-days.
NEUTRAL
-Distribution Days.
There have been 2 in the last 25-days. Cancelled by FT Day.
-Bollinger Bands
-RSI.
-Statistically, the S&P 500 gave a panic-signal, 18
June, but the signal has expired.
-Non-crash Sentiment indicator remains neutral, but it is
very bullish and that means the signal is leaning bearish.
-The Fosback High-Low Logic Index is neutral.
-VIX.
-The size of up-moves has been smaller than the size of
down-moves over the last month, but not enough to give a signal.
-29 July, the 52-week, New-high/new-low ratio improved by
0.4 standard deviations, somewhat bullish, but neutral.
-There have been 4 Statistically-Significant days in the
last 15-days. This can be a bull or bear signal. 4 is neutral.
-The S&P 500 is 11.6% above its 200-dMA (Bear
indicator is 12%.). This value was 15.9% above the 200-dMA when the 10%
correction occurred in Sep 2020.
-There were 5 Hindenburg Omen signals 16-23 Aug. The McClellan Oscillator turned positive so
the Omens have been cancelled.
-7.7% of all issues traded on the NYSE made new, 52-week
highs when the S&P 500 made a new all-time-high 2 September. (There is no
bullish signal for this indicator.) This is above the average for all-time highs.
-There have been 14 up-days over the last 20 days.
Neutral
-There have been 7 up-days over the last 10-days. Neutral
BEAR SIGNS
-Overbought/Oversold Index (Advance/Decline Ratio) is
overbought.
-Breadth on the NYSE compared to the S&P 500 index is
bearish.
-Cyclical Industrials (XLI-ETF) have been under-performing
the S&P 500 recently.
-The S&P 500 is under-performing the Utilities ETF
(XLU).
-The Smart Money (late-day action) indicates the Pros are
selling. (This indicator is based on the Smart Money Indicator developed by Don
Hayes).
On Friday, 21 February, 2 days after the top of the
Coronavirus pullback, there were 10 bear-signs and 1 bull-sign. Now there
are 5 bear-signs and 14 bull-signs. Last week, there were 7 bear-signs and 10
bull-signs.
The daily sum of 20 Indicators slipped from +4 to +1(a
positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations improved from -25 to -14. (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, Price, VIX & Sentiment indicators are
neutral.
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
FRIDAY 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.
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.
As a general rule, some
suggest that the % of portfolio invested in the stock market should be one’s
age subtracted from 100. So a 30 year
old person would have 70% of the portfolio in stocks, stock mutual funds and/or
stock ETFs. That’s ok, but I usually
don’t recommend keeping less than 50% invested in stocks (as a fully invested
position) since most people need some growth in the portfolio to keep up with
inflation.
