“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
EMPIRE STATE MANUFACTURING (Advisor Perspectives)
“Business activity grew strongly in New York State,
according to firms responding to the November 2021 Empire State Manufacturing
Survey. The headline general business conditions index climbed
eleven points to 30.9... Employment grew at its fastest pace on record, and the
average workweek increased. The prices paid index held near its record high,
and the prices received index reached a new peak.” Commentary and analysis
at...
IS CASH A GOOD “RISK” HEDGE? (RIA)
“...Importantly, I am not talking about being 100%
in cash. Instead, I am suggesting that during periods of uncertainty, cash
provides both stability and opportunity. Yes, cash will lose purchasing power
over the holding period, but equities can lose a lot more when “fast risk” happens. With the
fundamental and economic backdrop becoming much more hostile toward investors
in the intermediate term, understanding the value of cash as
a “hedge” against loss becomes more important. Given the length
of the current market advance, deteriorating internals, high valuations, and
weak economic backdrop, reviewing cash as an asset class in your
allocation may make some sense. Of course, since Wall Street does not make fees
on investors holding cash, maybe there is another reason they are so adamant
that you remain invested all the time.” Commentary at...
https://realinvestmentadvice.com/is-cash-good-hedge/
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 5:15 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. I added the smoothed 10-dMA of new cases (in purple) to the chart.
Trend numbers remain essentially flat. At this point, we
worry that the new cases may start rising, but it is too soon to make a call
either way.
MARKET REPORT / ANALYSIS
-Monday the S&P 500 was a whisker below Friday’s
close, but remained 4683.
-VIX rose about 1% to 16.49.
-The yield on the 10-year Treasury rose to 1.622%.
Friday’s run-down of some important indicators remained
on the bull side (3-bear and 13-bull) a little weaker than last week. Monday, we
picked up few more bear signals when the MACD of S&P 500 price had a
bearish crossover and the plot of my short-term, new-high/new-low data turned
down. Overall though, markets look good.
There are still no topping indicators issuing
warnings. At the recent top on 8
November, there was only 1 bearish top indicator, RSI.
Today, the daily sum of 20 Indicators declined from zero to -3
(a positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations declined from +25 to +18 (These numbers
sometimes change after I post the blog based on data that comes in late.) Most
of these indicators are short-term so they tend to bounce around a lot.
The Long Term NTSM indicator ensemble
improved to BUY. Price & VIX are bullish; Volume & Sentiment are
neutral. The number of up-days over the last 20-days improved to neutral.
I am bullish.
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
** XLE has outgained XLY over
the last 2 months so I am still holding XLE rather than switching to XLY.
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 remained HOLD.
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 50% invested in stocks; this is my “normal” fully
invested stock-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
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.
