“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“Faced with a combination of record speculative extremes
and deteriorating speculative conditions, investors may want to remember that
the best time to panic is before everyone else does.” – John Hussman, Phd.
PRODUCER PRICE INDEX (BLS)
“The Producer Price Index for final demand increased 0.8
percent in February, as prices for final demand goods rose 2.4 percent, and the
index for final demand services was unchanged. Final demand prices moved up
10.0 percent for the 12 months ended in February.” Press release at...
While the monthly number was slightly below forecast, the
year-over-year number tied the highest on record.
EMPIRE STATE MANUFACTURING (New York Fed)
“Business activity declined in New York State for the
first time since early in the pandemic, according to firms responding to the
March 2022 Empire State Manufacturing Survey. The headline general business conditions
index fell fifteen points to -11.8, its lowest level since May 2020. New orders
and shipments declined modestly, while unfilled orders increased. Delivery
times continued to lengthen substantially, and inventories expanded. Labor
market indicators pointed to a modest increase in employment and a slightly
longer average workweek. The prices paid index remained very elevated, and the
prices received index reached yet another record high.” Press release at...
https://www.newyorkfed.org/survey/empire/empiresurvey_overview
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 jumped up about 2.1% to 4262.
-VIX fell about 6% to 29.87.
-The yield on the 10-year Treasury rose to 2.148%.
Pullback Data:
Days since top: 49 (Avg= 30 days top to bottom for
corrections <10%; 60 days top to bottom for larger, non-crash pullbacks)
Drop from Top: Now 11.1% at close. Max at close: 13%
(Avg.= 13% for non-crash pullbacks)
The S&P 500 is 4.6% below its 200-dMA & 4.3%
below its 50-dMA.
TODAY’S COMMENT:
All up today! The only
weakness was in energy. Oh man, it was
weak. I sold my XLE-ETF (Energy) position today at break-even. I wasn’t happy though – I gave up an 8% gain in
the last 2 days. Ouch! I’ll buy it back
if it swings higher.
We still have the Death Cross on the S&P 500. The slope of the 200-dayMA moved higher and is
now sloping up. That signal may flip-flop.
We’ll see if the Death Cross remains in place.
I still don’t think that yesterday was it a final bottom for
this downturn - internals deteriorated Monday. They need to get better on
retests. Still, the S&P 500 did make a double-bottom Monday so a bounce
from here may be more likely, given Tuesday’s positive move.
The daily sum of 20 Indicators improved from -3 to zero
(a positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations declined from +44 to +34 (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 improved to HOLD. VIX is bearish; VOLUME & SENTIMENT are
neutral. PRICE is bullish.
Until we see more bullish signs, I remain bearish.
BEST ETFs - 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
BEST DOW STOCKS - TODAY’S MOMENTUM
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.
https://navigatethestockmarket.blogspot.com/p/a-system-for-trading-dow-30-stocks-my_8.html
TUESDAY MARKET INTERNALS (NYSE
DATA)
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.
I trade about 15-20% of the
total portfolio using the momentum-based analysis I provide here. If I can see
a definitive bottom, I’ll add a lot more stocks to the portfolio using an
S&P 500 ETF.
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.
