PENDING HOME SALES (YahooFinance)
“Pending home sales, a leading indicator of the health of
the housing market, rose in August, reversing two straight months of declines.
The National Association of Realtors’ (NAR) Pending Home Sales Index,
which tracks the number of homes that are under contract to be sold, rose 8.1%
in August to a seven-month high from the previous month.” Story at...
https://finance.yahoo.com/news/pending-home-sales-august-2021-140006767.html
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 4.6 million barrels from the
previous week. At 418.5 million barrels, U.S. crude oil inventories are about
7% below the five year average for this time of year.” Press release at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
BOOK REVIEW: “UNSETTLED: WHAT CLIMATE SCIENCE TELLS US
ABOUT GLOBAL WARMING AND WHAT IT DOESN’T, BY STEVEN E. KOONIN” (RealClearEnergy)
“Koonin’s indictment of The Science starts with its
reliance on unreliable computer models...One particularly jarring feature is
that the simulated average global surface temperature,” Koonin notes, “varies
among models by about 3°C, three times greater than the observed value of the
twentieth century warming they’re purporting to describe and explain.” Another
embarrassing feature of climate models concerns the earlier of the two
twentieth-century warmings from 1910 to 1940, when human influences were much
smaller. On average, models give a warming rate of about half of what was
actually observed...“That the models can’t reproduce the past is a big red flag
– it erodes confidence in their projections of future climates.” Neither is it
reassuring that for the years after 1960, the latest generation of climate
models show a larger spread and greater uncertainty than earlier ones –
implying that, far from advancing, The Science has been going backwards. That
is not how science is meant to work.” Book Review at...
My cmt: I am reading “Unsettled?” now. It is a very good book. Dr. Koonin is not a climate denier. He goes into great detail explaining the
earth’s temperature rise of 1.1 degree C over the last 120 years. He discusses
CO2 as the primary greenhouse gas and its increase over the 20th
Century. However, the book is disturbing, because he presents a convincing case
that a great deal of the science related to the impacts of Global Warming is
truly unsettled and subject to media propaganda.
LET’S WORK FOR SCIENCE WITH INTEGRITY (Forbes)
...Why is the [climate] science so poorly communicated to
the public and policy makers? For Koonin, it is clear that distorted science
serves the interests of diverse players, ranging from environmental NGOs
[Non-Governmental Orgaizations], media, politicians, scientists and scientific
organizations. The ideological corruption of the hard sciences has been
remarked upon by others but
Koonin covers it with telling examples arising from his own experiences over
the years. Climate science, he asserts, has been an effort “to persuade rather
than inform”, leaving out what does not fit the overarching narrative.... “It
is up to scientists to put forward facts without an agenda or a pre-existing
narrative, but it is not easy. Koonin says, “I should know, that used to be my
job” Story at...
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website
as of 9:00 PM Wednesday. 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.
I added the smoothed 10-dMA of new cases (in purple) to the chart.
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 0.2% to 4359.
-VIX slipped about 3% to 22.56.
-The yield on the 10-year Treasury rose to 1.512%.
The Democrats have the votes to raise the Debt Limit
without any action from the Republicans and the Republicans won’t vote to raise
the Debt Ceiling. That’s what the Republicans have been saying all along. So,
we have a crisis, because the democrats won’t pass the Debt Ceiling and they
(the Democrats) are trying to blame the Republicans. Insane. Both parties are
just posturing and neither deserves our respect, or votes for that matter.
The current market weakness could always just be a result
of the clowns in DC. Sorry, I didn't mean to insult clowns.
The S&P 500 tested the prior low yesterday, but
volume was higher and internals were worse – that’s a “failed test” that suggests
that selling pressure increased. Is more
selling to come? It would seem so, but there is no guarantee and these signals
can sometimes be just a fake-out. In this case, my long-term ensemble indicator
also switched to sell. Together, or separately,
they are decent enough signals that I cut stock holdings to 45%. Is it the
right decision? I don’t really know, but I am following the indicators rather
than over thinking the decision. Trade what you see not what you think.
The daily sum of 20 Indicators declined from -3 to -10 (a
positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations declined from -53 to -55 (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 dropped to SELL. VIX and Volume were bearish; Price & Sentiment
indicators are neutral.
I’m leaning bearish, but who
knows – perhaps buy-and-hold would have worked better. We’ll have to wait and
see.
Utilities (the XLU-ETF) way
outperformed the S&P 500 today, so there are others who agree that a more
defensive stance might be a good idea.
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
WEDNESDAY MARKET INTERNALS
(NYSE DATA)
Market Internals declined to BEARISH 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 in the
portfolio is now about 45% invested in stocks; this is below my “normal” fully
invested allocation of 50%.
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
for older investors, 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.
