“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
JOBLESS CLAIMS (CNBC)
“Initial filings for unemployment insurance dipped last
week and remained close to their lowest level in more than 50 years, the Labor
Department reported Thursday. Jobless claims for the week ended Dec. 25 totaled 198,000...” Story at...
https://www.cnbc.com/2021/12/30/weekly-jobless-claims-total-198000-less-than-expected.html
CHICAGO PMI (Advisor Perspectives)
“The latest Chicago Purchasing Manager's Index, or the
Chicago Business Barometer, rose to 63.1 in December from 61.8 in November,
which is still in expansion territory.” Story at...
https://www.advisorperspectives.com/dshort/updates/2021/12/30/chicago-pmi-picks-up-in-december
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 7:00 PM ET Thursday. 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.
New Daily Cases are 5 times higher than they were 5 days
ago. I needed a new scale for the graph due to the huge spike in cases. Hard to
believe that Omicron has already outpaced prior peaks for new-cases. As for me, I may be getting over Omicron.
My “cold” peaked quickly and is now fading. This was not a normal cold. Was it Covid? Perhaps.
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 slipped about 0.3% to 4779.
-VIX rose about 2% to 17.33
-The yield on the 10-year Treasury dipped to 1.510%.
Head and shoulders pattern in the morning...failed highs
all day long and then a late-day selloff. Man, what an ugly chart. This has been typical late-day action recently,
but late-day action is still bullish longer term. It is unsettling, but I just
need to remember the Pros are still on vacation so the market action may not be
representative of what to expect in January.
I am bothered by the fact that Utilities have been
outperforming the S&P 500, not only recently, but longer term too. That’s a bearish sign. Overall though, the
markets are not exhibiting many bearish signs.
The daily sum of 20 Indicators slipped from +5 to +3
today (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations improved from -17 to -16 (The
trend direction is more important than the actual number for the 10-day value.)
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 remained HOLD. Price is bullish; VIX, Volume & Sentiment are
Neutral.
Covid Omicron numbers are going thru the roof. That is
going to worry the markets for a while, so I may take some profits in Apple and
XLK until we see if Omicron will have an impact on markets.
I am a cautious Bull. We’ll
see how long this market can keep going.
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 to 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 of 50%. I trade about 15-20% of the total
portfolio.
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.
