“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
"Multiple...Republican congressmen...sought
presidential pardons [from then President Trump, including Rep. Scott Perry,
R-Pa] for their roles in attempting to overturn the 2020 election," – Liz
Cheney, R-Senator from Wyoming at the Jan 6 Hearing.
https://abcnews.go.com/Politics/live-updates/live-updates-jan6-hearing/?id=85254621#85299642
Rep Perry’s spokesman responded:
"This sham committee is nothing but a breathtaking
abuse of power, conjuring up political theatre to destroy opponents and
distract the American people form the economic and national security nightmare
created by one-party rule and the radical left."
My cmt: Notably, Perry didn’t deny Cheney’s claim; when
you don’t have an argument, resort to name calling. Unfortunately, that’s a
common thread for a lot of Politicians these days.
My view of the Jan 6 “hearings” is “show-me-the-facts”
and tell me something I didn’t already know. The testimony regarding Congressmen
requesting pardons should be fascinating when it is presented.
"We've obtained substantial evidence showing that
the president's December 19 tweet calling his followers to Washington, D.C., on
January 6 energized individuals from the Proud Boys and other extremist
groups." – Jan 6 Committee Chair, Bennie Thompson.
It’s hard to conclude that Trump’s tweet alone was
responsible. Here are Trump’s Tweets from 19 Jan related to the election.
|
December
19, 2020 |
Peter
Navarro releases 36-page report alleging election fraud 'more than
sufficient' to swing victory to Trump https://t.co/D8KrMHnFdK . A great
report by Peter. Statistically impossible to have lost the 2020 Election. Big
protest in D.C. on January 6th. Be there, will be wild! |
|
December
19, 2020 |
He
didn't win the Election. He lost all 6 Swing States, by a lot. They then
dumped hundreds of thousands of votes in each one, and got caught. Now
Republican politicians have to fight so that their great victory is not
stolen. Don't be weak fools |
|
December
19, 2020 |
The
lie of the year is that Joe Biden won! Christina Bobb @OANN |
The big question is: Can they show a direct connection
between Trump and the extremists, i.e., was Trump directly involved? Cheney
says the Committee will show that Trump had a 7 Point Plan to overturn the
election. Will testimony related to the
7-Point Plan be compelling? We’ll see.
CPI (Yahoo Finance)
“U.S. consumer prices accelerated in May at the fastest
rate since 1981, as Americans grapple with a surge in the cost of gas, food,
and shelter, data showed Friday. The Bureau of Labor Statistics' May
Consumer Price Index (CPI) showed a year-over-year increase of 8.6% last month...
"Core" inflation, which strips out the more volatile costs of food
and gas, rose 6% over the prior year” Story at...
https://finance.yahoo.com/news/may-inflation-data-june-10-2022-212834308.html
Both sets of numbers were below expectations.
CONSUMER CONFIDENCE (CNBC)
“University of Michigan Index of Consumer Sentiment...registered a paltry 50.2,
the lowest in survey data going back to 1978. That’s lower than the depths of
the Covid outbreak, lower than the financial crisis, lower even than the last
inflation peak back in 1981.” Story at...
MARKET REPORT / ANALYSIS
-Friday the S&P 500 fell about 2.9% to 3901.
-VIX rose about 6% to 27.75.
-The yield on the 10-year Treasury rose to 3.163%.
PULLBACK DATA:
-Drop from Top: 18.7% as of today. 18.7% max. (Avg.= 13%
for non-crash pullbacks)
-Days from Top to Bottom: 110-days. (Avg= 30 days top to
bottom for corrections <10%; 60 days top to bottom for larger, non-crash
pullbacks)
The S&P 500 is 12.2% BELOW its 200-dMA & 7.1%
BELOW its 50-dMA.
*I won’t call the correction over until the S&P 500
makes a new-high; however, we hope to be able to call the bottom when we see it.
MY TRADING POSITIONS:
SSO*
XLK*
UWM*
Oops. The drop was
fast and furious yesterday afternoon and I didn’t get out; I expected a bounce
Friday – wrong again.
XLE
DOW - Dow
is now down over the last 2 months. It had been holding up well over the
downturn but it was down 6% today so it is time to treat this like other stocks
in the portfolio and sell it.
TODAY’S COMMENT:
No, Mr. Market
didn’t like the CPI or Consumer Confidence numbers or the Bond market response).
Notably, the S&P 500 tested its prior low of 3900 around 1pm, climbed in
the afternoon and then dumped more than 1% down in the last half-hour of
trading. The Index closed at 3901, again at “test-the-low” levels.
Volume was about 5% lower than when the S&P 500 last
hit these levels. That’s not huge, but it does suggest that there was no more
(and possibly less) fear than there was at the prior low. Internals did not
improve much compared to the prior low, so this does not look like a durable
low. It seems to me that Markets could
bounce here, but signals are not optimistic.
Today was a statistically significant down-day. That just
means that the price-volume move exceeded my statistical parameters. Statistics
show that a statistically-significant, down-day is followed by an up-day about
60% of the time. This could also signal
a reversal back to the upside.
On Fridays, I summarize a number of indicators to get a
weekly feel for trend. Overall, the end-of-week summary reversed sharply to the
Bear side (18-bear and 4-bull). These indicators tend to be both long-term and
short-term, so they are different than the 20 that I report on daily. Details
follow:
BULL SIGNS
-Issues advancing on the NYSE (Breadth) compared to the
S&P 500 are Bullish.
-MACD of S&P 500 price made a bullish crossover 23
May.
-Cyclical Industrials (XLI-ETF) are out-performing the
S&P 500.
-The S&P 500 is 12.2% below its 200-dMA. (Bull
indicator is 12% below the 200-day.)
NEUTRAL
-Sentiment.
-Overbought/Oversold Index (Advance/Decline Ratio).
-There were back-to-back-to-back 80% up-volume days
Wednesday, Thursday and Friday of last week. These were cancelled by the 90%
Down-volume day yesterday (Thursday). Now it’s back to neutral.
-The graph of the 100-day Count (the 100-day sum of up-days)
was 46; the chart trend is flat to slightly down.
-The size of up-moves has been smaller than the size of
down-moves over the last month, but not enough to send a signal.
-There was a Breadth Thrust 2 June. That’s a rare bullish
sign. - Expired
-The 52-week, New-high/new-low ratio improved by 3.5
standard deviations on 13 May. - Expired.
-The Fosback Hi-Low Logic Index – Neutral, but close to
Bullish.
-Friday a week ago was a Bullish Outside Reversal Day -
expired.
-Bollinger Bands.
-RSI.
-There was a Hindenburg Omen signal 8 April – it was
canceled when the McClellan Oscillator turned bullish.
-There have been 9 up-days over the last 20 sessions –
neutral.
-There have been 4 up-days over the last 10 sessions –
neutral.
-The Calm-before-the-Storm/Panic Indicator.
-2.8% of all issues traded on the NYSE made new, 52-week
highs when the S&P 500 made a new all-time-high, 3 January. (There is no
bullish signal for this indicator.) This indicated that the advance was too
narrow and a correction was likely to be >10%. – It proved correct, but is
now Expired
-There have been 2 Statistically-Significant day (big
moves in price-volume) in the last 15-days.
BEAR SIGNS
-The 10-dMA % of issues advancing on the NYSE
(Breadth) is belwo 50%.
-There have been 7 Distribution Days since the last
Follow-Thru Day on 4 May.
-The 50-dMA percentage of issues advancing on the NYSE
(Breadth) is below 50.
-The 100-dMA percentage of issues advancing on
the NYSE (Breadth) is below 50%
-The 50-dMA percentage of issues advancing on the NYSE
(Breadth) has been below 50% for more than 100 consecutive days. (3 days in a
row is my “correction-now” signal)
-McClellan Oscillator is negative.
-Buying Pressure minus Selling Pressure is headed
down
-VIX is rising sharply.
-The smoothed advancing volume on the NYSE is falling.
-Slope of the 40-dMA of New-highs is falling. This is one
of my favorite trend indicators.
-Short-term new-high/new-low data reversed down.
-Long-term new-high/new-low data reversed down.
-My Money Trend indicator is has reversed down.
-MACD of the percentage of issues advancing on the NYSE
(breadth) made a bearish crossover 9 June.
-The Smart Money (late-day action) turned down today.
-The 5-10-20 Timer System is SELL; the 5-dEMA and 10-dEMA
are both BELOW the 20-dEMA.
-43% of the 15-ETFs that I track have been up over the
last 10-days.
-Utilities (XLU) are outperforming the S&P 500 and
divergence turned more negative yesterday and today.
On Friday, 21 February, 2 days after the top before the
Coronavirus pullback, there were 10 bear-signs and 1 bull-sign. Now there
are 18 bear-signs and 4-Bull. Last week, there were 8 bear-signs and 14
bull-signs.
Today, the daily sum of 20 Indicators dropped from +4 to -2
(a positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations dropped from +127 to +110. (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 20 indicators are short-term so they tend to bounce
around a lot.
LONG-TERM INDICATOR: The Long
Term NTSM indicator slipped to SELL: PRICE and SENTIMENT are neutral; VOLUME
and VIX are bearish.
I had planned to SELL trading positions today if markets
were down, but then I realized they weren’t just down, they were testing the
lows. I’m bearish, but let’s see if we get a bounce from the retest of the low.
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
FRIDAY 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.
My stock-allocation in the
portfolio is now roughly 55% invested in stocks. This is slightly above my
“normal” fully invested stock-allocation of 50%. I am calling this defensive
because my current positions are trading positions – not long-term holds. We
need to be very vigilant now to avoid losses in future declines.
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.
