“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
JOLTS JOB OPENINGS (CNBC)
“The so-called Great Resignation lost some steam in
October, with the total number of workers leaving their jobs either due to
dissatisfaction or better opportunities elsewhere declined...While the quits
rate dropped, the level of job openings accelerated to just below its all-time
high. That number totaled 11.03 million, an increase of 4.1% as the rate rose
to 6.9% from 6.7%.” Story at...
JOB GAP HAS GROWN TO TWO UNEMPLOYED WORKERS PER THREE
OPENINGS (WSJ)
“U.S. job openings continue to far outpace the number of
available workers, with nearly five million more open positions than people
seeking work.” Story at
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) decreased by 0.2 million barrels from the
previous week. At 432.9 million barrels, U.S. crude oil inventories are about
7% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
CHARTS SUGGEST YEAR END RALLY (CNBC)
“Charts suggest the stage is getting set for a year-end rally in the S&P 500, CNBC’s Jim Cramer said Wednesday, leaning on analysis from technician Mark Sebastian... it could send the S&P soaring from around 4,700 now to possibly as high as 5,000” Story at...
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 8:00 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 0.3% to 4701.
-VIX fell about 9% to 19.9.
-The yield on the 10-year Treasury rose to 1.524%.
The “correction” lasted 8-days and dropped 4% top to
bottom. Correction?! Let’s just call it weakness, but it exhibited some signs
usually found in bigger downturns.
During the decline there were two bearish, 90% down-volume days. The Index then had back-to-back, 80%,
up-volume days within 5-days of the low. That gave a high probability that the
pullback was over. The fact that it all
happened in the space of 12 days (from top to buy-signal) indicates the extreme
bullishness currently exhibited by investors. This analysis is based on work by
Paul Desmond of Lowry Research, a Florida based investment research firm. Paul
has passed away, but his work on markets is legendary.
The daily sum of 20 Indicators remained zero (a positive
number is bullish; negatives are bearish); the 10-day smoothed sum that smooths
the daily fluctuations improved from -110 to -101 (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. VIX, Volume, Price & Sentiment are Neutral.
I am bullish. We’ll just have to see how long the bullish
trend remains.
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.
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 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 65% invested in stocks; this is slightly above my
“normal” fully invested stock-allocation of 50%. I’ll hold that position until
I see first signs of weakness. The goal here is to use cash for short-term
gains and then return to cash with 50% invested in stocks.
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.
