“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
https://thecollegeinvestor.com/35892/is-student-loan-forgiveness-by-executive-order-legal/
...but that didn’t stop Biden’s trillion-dollar (according to the Wharton Business School) give-away. Wouldn’t that be inflationary?
“The headline Flash US PMI Composite Output Index registered 49.3 in September, up from 44.6 in August, to signal a softer and only marginal decline in private sector business activity.” Press release at...
https://www.pmi.spglobal.com/Public/Home/PressRelease/df290cbcbcc941359da947c724460831
“The firm studied past bear markets during the post-World War II period that began at all-time highs and saw at least three legs down of 10% or more before the S&P 500 ultimately bottomed. Those began in January 1973, November 1980, August 1987, March 2000 and October 2007, according to Bespoke. If there was one consistent pattern within all five of the prior periods highlighted, it is that in every one, the S&P 500 made a lower low in its third leg lower,” Bespoke said. The S&P 500 is not far above its June low, “so either the market has further to fall,” or if the index can rally back to 4,250, “it would offer some faint hope to bulls that the worst of the declines would be behind us.”
S&P 500 sees its third leg down of more than 10%. Here’s what history shows about past bear markets hitting new lows from there, according to Bespoke. (msn.com)
“The Fed’s rate hiking at the short-term end of the maturity spectrum is outpacing the rise in long term yields, which is resulting in an inverted yield curve...Inverted yield curves have a perfect track record going back decades for predicting recessions. So let not your heart be troubled about the question of whether we are going to have a recession. We are for sure going to have one...The question we should still worry about, though, is what that means for the stock market, and the answer there is not as clear... Once we see a bottom in the 10-1 yield spread, then we can start anticipating an important stock market [bottom] about 22 months later." Commentary at...
https://www.mcoscillator.com/learning_center/weekly_chart/inverted_yield_curve_means_2024_bottom/
The Dot.com stock market crash took 3 years to go from top to bottom so this analysis is entirely possible, especially if the spread bottoms this year.
“...a key reason why the Colorado River is running out of water has more to do with math than anything — bad math. One hundred years ago, government officials divvied up water in the Colorado River among the seven states that rely on it including Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming. The agreement, known as the Colorado River Compact, was based on one critically important number: the total amount of water that the Colorado River can supply yearly. Ignoring the best science of the time, officials claimed the river could provide about 20 million acre-feet per year (an acre-foot is the amount of water needed to fill an acre with one foot of water), according to the 2021 book Science Be Dammed: How Ignoring Inconvenient Science Drained the Colorado River. That number was way too high, the authors write, meaning that officials promised states water that simply didn’t exist.
Story at... How a 100-year-old miscalculation drained the Colorado River (msn.com)
-Friday the S&P 500 fell about 1.7% to 3693.
-VIX rose about 9% to 29.92.
-The yield on the 10-year Treasury slipped to 3.688%.
-Drop from Top: 23% as of today. 23.6% max (on a closing basis).
-Trading Days since Top: 181-days.
The S&P 500 is 12.9% Below its 200-dMA & 8.6% Below its 50-dMA.
Support is the prior low, 3667. It held today, but probably ot uch further.
SH, short the S&P 500 ETF.
SDS, 2x short S&P 500 ETF.
I have built these positions to significantly large values, although I am still not net short.
The S&P 500 fell below its June low of 3667, and climbed above that level after 3 pm. VIX is now about 30. At the bottom of the Financial Crisis in 2009 the VIX was 50 or so. During that bear market VIX hit 80 at one point. This doesn’t say for certain that this correction has a lot further to fall, but it does cause one to wonder.
-The longer-term, 50-dEMA, Fosback Hi-Low Logic Index is Bullish.
-Overbought/Oversold Index (Advance/Decline Ratio) is oversold.
-Bollinger Bands.
-The S&P 500 is 12.9% below its 200-dMA. (Bull indicator is 12% below the 200-day, although this is based on “normal” pullbacks.)
-There have been 1 Statistically-Significant day (big moves in price-volume) in the last 15-days...neutral.
-The Calm-before-the-Storm/Panic Indicator warned on 13 September - expired.
-There have been 7 up-days over the last 20 sessions. – This works with sentiment. Sentiment is too high so this is neutral.
-There have been 3 up-days over the last 10 sessions – leaning bullish, but neutral.
-RSI
-Sentiment.
-Issues advancing on the NYSE (Breadth) compared to the S&P 500 now neutral.
-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.
-The short-term, 10-day, Fosback Hi-Low Logic Index.
-There was an Inverse Zweig Breadth Collapse (negative Breadth Thrust) 21 June. That’s a rare, very-bearish sign, but it was several-weeks ago - expired.
-The 52-week, New-high/new-low ratio improved by 0.1 standard deviations on 19 Sep – too small to send a signal.
-There was a Hindenburg Omen signal 8 April – it was canceled when the McClellan Oscillator turned bullish.
-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
-The smoothed advancing volume on the NYSE is falling.
-There have been 13 Distribution Days over the last 5 weeks.
-23 Sept was a bearish, >90%-down-volume day.
-The 10-dMA percentage of issues advancing on the NYSE (Breadth) is below 50%.
-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 3 days in a row below 50% for my “correction-now” signal. – It hardly matters now.
-MACD of the percentage of issues advancing on the NYSE (breadth) made a bearish crossover 30 Aug.
-MACD of S&P 500 price made a bearish crossover 22 Aug.
-21 Sep was a Bearish Outside Reversal Day.
-Smoothed Buying Pressure minus Selling Pressure is falling.
-The 5-10-20 Timer System is SELL; the 5-dEMA and 10-dEMA are both below the 20-dEMA. (The 5-day is below the 10-day so short-term momentum is bearish too.)
-VIX is rising quickly.
-My Money Trend indicator is falling.
-McClellan Oscillator is negative.
-The Smart Money (late-day action) is down.
-The graph of the 100-day Count (the 100-day sum of up-days) is falling.
-Long-term new-high/new-low data.
-Short-term new-high/new-low data.
-Cyclical Industrials (XLI-ETF) are under-performing the S&P 500 and falling so I’ll call it bearish.
-Slope of the 40-dMA of New-highs is falling. This is one of my favorite trend indicators.
- 29% of the 15-ETFs that I track have been up over the last 10-days.
-S&P 500 is underperforming the Utilities (XLU).
TODAY’S RANKING OF 15 ETFs (Ranked Daily)
None of the ETFs I track are above their 120-dMA so the chart is no good. ETF ranking follows:
#1 XLU; #2. XLE #3. IBB
*For additional background on the ETF ranking system see NTSM Page at…
http://navigatethestockmarket.blogspot.com/p/exchange-traded-funds-etf-ranking.html
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
