Best DOW Stocks ... Best ETFs … Stock Market Analysis ... Pending Home Sales ... Crude Inventories
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“If I had to pick the most worrying characteristic of our
current dystopia, I would choose the unsettling disconnect between the
seriousness of the challenges we face and the public discourse that is supposed
to be addressing them...Our leaders of both parties now seem free to utter
things completely at odds with reality and logic.” -Gerald Baker, Editor at
Large, WSJ. Opinion at...
https://www.wsj.com/news/author/gerard-baker
PENDING HOME SALES (Yahoo Finance)
“Pending home sales in the U.S. fell more
than expected in
August — notching the third consecutive month of declines — as higher borrowing
costs pushed more prospective buyers to the sidelines...Year over year, pending
sales were down by 24.2%.” Story at...
https://finance.yahoo.com/news/housing-pending-home-sales-drop-140030400.html
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 430.6 million barrels, U.S. crude oil inventories are about
2% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
WHITE HOUSE PHONE LOGS WERE FAKED (DURING THE RIOTS)
(msn.com)
“...when we looked for White House calls during the
blackout, we saw what we expected to see: the president’s attorneys, family
members, allies, and top political advisers all calling out to or receiving
calls from West Wing root numbers. It was easy to see that, contrary to the
call logs, White House lines were active during the attack on the Capitol...”
Story at...
How
the Jan. 6 committee researchers found that the White House call log during the
attack was a fraud (msn.com)
What were they hiding?
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 2% to 3719.
-VIX fell about 7% to 30.18.
-The yield on the 10-year Treasury slipped to 3.736%.
PULLBACK DATA:
-Drop from Top: 22.5% as of today. 24% max (on a closing
basis).
-Trading Days since Top: 185-days.
The S&P 500 is 11.9% Below its 200-dMA & 7.6%
Below its 50-dMA.
Support is around 3250, the lows of September 2020.
VIX WATCH: 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 that this correction has a lot further to
fall, but it does cause one to wonder.
*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:
CVX – I added Chevron because it is close to its lower
trend line; has a PE below 10 and pays nearly a 4% dividend. The Biden
administration is going to replenish the strategic petroleum reserve after the
election so, oil prices should go up.
SPY – S&P 500
SSO - 2x S&P 500
TODAY’S COMMENT:
We got the reversal upward as was indicated by
market internals Tuesday, but we almost saw a very bullish sign.
90% of the volume on the NYSE was up-volume Wednesday. That’s a good sign, but there was some late-day
weakness that meant the day did not meet the Lowry Research test for a bullish 90%
up-volume day. That would have given a signal of a bottom, but it was not to be.
For now, we have to assume that the up-move is a bounce, not a bottom.
Today was a statistically significant up-day. That just
means that the price-volume move exceeded my statistical parameters. Statistics
show that a statistically-significant, down-day is followed by a down-day about
60% of the time.
Today, the daily sum of 20 Indicators improved from -8 to
-7 (a positive number is bullish; negatives are bearish); the 10-day smoothed
sum that smooths the daily fluctuations declined from -70 to -79. (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 remained SELL: VOLUME & VIX are bearish; SENTIMENT
& PRICE are neutral. Remember for the longer-term, one indicator trumps
them all – “Don’t fight the FED.”
Bottom line: I’m a skeptical Bull; I bought some stocks
Wednesday and I’m back to about 40% invested in stocks.
BEST ETFs - MOMENTUM ANALYSIS:
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. IBB #2. XLU XLY #3.
*For additional background on
the ETF ranking system see NTSM Page at…
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.
My momentum chart for the Dow has blown up. DOW 30 momentum ranking
follows:
#1 UNH; #2. AAPL #3. MCD
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)
My basket of Market Internals improved 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 most useful when they diverge from the Index.)
...BUT I ADDED STOCK POSITIONS
TO INCREASE TO 40% INVESTED IN STOCKS, WEDNESDAY.
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.
