“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
“Consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased 0.4% last month...The personal consumption expenditures (PCE) price index gained 0.3% after dipping 0.1% in July...The so-called core PCE price index climbed 4.9% on a year-on-year basis in August after increasing 4.7% in July.” Story at...
https://www.reuters.com/markets/us/us-consumer-spending-rebounds-august-inflation-picks-up-2022-09-30/
“The Chicago Business Barometer, also known as the Chicago PMI, dropped sharply to 45.7 in September from 52.2 in the prior month.” Story at...
https://www.marketwatch.com/story/chicago-pmi-falls-sharply-in-september-to-lowest-level-in-more-than-two-years-11664545969
“Consumer sentiment was essentially unchanged in September, just 0.4 index points above August, according to the University of Michigan Surveys of Consumers... ‘Consumers welcomed the slowdown in inflation last month, but they show signs of uncertainty over the trajectory of the economy...’”
https://news.umich.edu/uncertainty-clouds-consumers-outlook-on-the-economy/
-Friday the S&P 500 fell about 1.5% to 3586.
-VIX went against trend and declined 0.2% to 31.62.
-The yield on the 10-year Treasury rose to 3.829%.
-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.
CVX
SPY – S&P 500
SSO - SOLD
I sold SSO. Markets don’t want to go up, even though there are oversold signs.
That’s an ugly close.
-The longer-term, 50-dEMA, Fosback Hi-Low Logic Index is Bullish.
-The short-term, 10-day, Fosback Hi-Low Logic Index.
-Overbought/Oversold Index (Advance/Decline Ratio) is oversold.
-The S&P 500 is 14.4% below its 200-dMA. (Bull indicator is 12% below the 200-day, although this is based on “normal” pullbacks.)
-The smoothed advancing volume on the NYSE is rising.
-Issues advancing on the NYSE (Breadth) compared to the S&P 500 are bullish.
-My Money Trend indicator turned up today.
-There was a Follow-thru day 28 Sept and it cancels the 13 Distribution Days over the last 5 weeks.
-RSI
NEUTRAL
-Bollinger Bands.
-There have been 3 Statistically-Significant days (big moves in price-volume) in the last 15-days...neutral.
-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 2 up-days over the last 10 sessions – leaning bullish, but neutral.
-The Calm-before-the-Storm/Panic Indicator warned on 13 September - expired.
-Sentiment.
-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 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 2.7 standard deviations on 28 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 Smart Money (late-day action) is flat.
-S&P 500 is underperforming the Utilities (XLU), but sharply improving – call it neutral.
BEAR SIGNS
-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.
-McClellan Oscillator is negative.
-Slope of the 40-dMA of New-highs is falling.
-23 Sept was a bearish, >90%-down-volume day. 28 Sept did not mee the tests for a 90% high volume up-day.
-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.
-Long-term new-high/new-low data.
-Short-term new-high/new-low data.
-The graph of the 100-day Count (the 100-day sum of up-days) is falling.
-Cyclical Industrials (XLI-ETF) are under-performing the S&P 500 so I’ll call it bearish.
- Only 23% of the 15-ETFs that I track have been up over the last 10-days.
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 9-Bull. Last week, there were 23 bear-signs and 4
bull-signs. Friday indicators are still giving a very bearish indication.
Friday was another new-low.
Today’s move was on higher volume, and that’s not a bullish sign. Today
was quarter-end and some of the volume is due to window dressing by money
managers, so I don’t give today’s volume numbers too much weight.
Today, the daily sum of 20 Indicators improved from -4 to
-2 (a positive number is bullish; negatives are bearish); the 10-day smoothed
sum that smooths the daily fluctuations improved from -81 to -80. (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 Bear again; however, I added stock to positions to get to about 35% invested in stocks this week. There are oversold conditions so a bounce next week is not out of the question.
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.XLV #3.XLY
*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.WMT #3.MRK
For more details, see NTSM Page at…
https://navigatethestockmarket.blogspot.com/p/a-system-for-trading-dow-30-stocks-my_8.html
My basket of 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 most useful when they diverge from the Index.)
...My current invested
position is about 35% stocks, including stock mutual funds and ETFs.
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.
-Bollinger Bands.
-There have been 3 Statistically-Significant days (big moves in price-volume) in the last 15-days...neutral.
-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 2 up-days over the last 10 sessions – leaning bullish, but neutral.
-The Calm-before-the-Storm/Panic Indicator warned on 13 September - expired.
-Sentiment.
-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 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 2.7 standard deviations on 28 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 Smart Money (late-day action) is flat.
-S&P 500 is underperforming the Utilities (XLU), but sharply improving – call it neutral.
-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.
-McClellan Oscillator is negative.
-Slope of the 40-dMA of New-highs is falling.
-23 Sept was a bearish, >90%-down-volume day. 28 Sept did not mee the tests for a 90% high volume up-day.
-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.
-Long-term new-high/new-low data.
-Short-term new-high/new-low data.
-The graph of the 100-day Count (the 100-day sum of up-days) is falling.
-Cyclical Industrials (XLI-ETF) are under-performing the S&P 500 so I’ll call it bearish.
- Only 23% of the 15-ETFs that I track have been up over the last 10-days.
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.XLV #3.XLY
*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.
My momentum chart for the Dow has blown up. DOW 30 momentum ranking follows:
#1 UNH #2.WMT #3.MRK
For more details, see NTSM Page at…
https://navigatethestockmarket.blogspot.com/p/a-system-for-trading-dow-30-stocks-my_8.html
My basket of Market Internals remained HOLD.
