“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
Political commentary at...
https://michaelpramirez.com/index.html
UNIVERSITY OF MICHIGAN SENTIMENT (Univ of Michigan)
“Consumer sentiment fell about 9% below October, erasing about half of the gains that had been recorded since the historic low in June...Overall, declines in sentiment were observed across the distribution of age, education, income, geography, and political affiliation...Inflation expectations are little changed. The median expected year-ahead inflation rate was 5.1%, up from 5.0% last month. Long run inflation expectations, currently at 3.0%, have remained in the narrow (albeit elevated) 2.9-3.1% range for 15 of the last 16 months.” Press release at
http://www.sca.isr.umich.edu/
A CRYPTO ERA ENDS – AND NOT WELL (Heritage Capital)
“I viewed the October 13th bottom as one of at least significance, if not the final bear market low...I have written that three things need to happen for the bear market to be over. The U.S. dollar needs to peak. [It appears to have peaked.] The 10-Year Note needs to go down. [Done] We are now waiting on the 2-Year Note to follow suit.” – Paul Schatz, President Heritage Capital. Commentary at...
https://investfortomorrow.com/blog/a-crypto-era-ends-and-not-well/
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose 0.9% to 3993.
-VIX fell about 4% to 22.52.
-The yield on the 10-year Treasury were unchanged at 3.819%.
PULLBACK DATA:
-Drop from Top: 16.8% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 217-days.
The S&P 500 is 2.2% Below its 200-dMA & 5.3% ABOVE its 50-dMA.
*I won’t call the correction over until the S&P 500 makes a new-high; however, evidence suggests the bottom was in the 3600 area and I am fully invested with a higher percentage of stocks than normal.
MY TRADING POSITIONS:
XLI – Industrial ETF (XLI still looks good to me. Nearly 10% of XLI is in Boeing and Caterpillar and they are both strong performers in the DOW momentum analysis.)
QLD – 2x Nas 100
DDM – 2x Dow 30
XLK – Technology ETF
CVX – (I may hold this as a long-term position. I already
owned a small position in CVX.)
XLE has taken the top position in the ETF momentum index.
I own CVX so I already have good exposure to energy.
TODAY’S COMMENT:
My VIX indicator turned bullish today. VIX has been slow to confirm the move higher so it is good to see this indicator join the party. On a more cautious note...
...The S&P 500 is 2.2% below its 200-dMA. The 200-day is a critical level of
resistance. We remember that the last
rally failed when the Index was 0.5% below its 200-day. I expect that the Index will break above its
200-dMA, but it may take a few tries along with a small pullback. That process is
likely to worry investors and shake out weak hands. If weakness occurs, I may
sell leveraged positions since declines can quickly erode gains in QLD and DDM.
On Fridays, I summarize a number of indicators to get a
weekly feel for trend. The Friday rundown of indicators is super bullish (4-bear
and 22-bull) ad are confirming the bottom call from late September and
mid-October. These indicators tend to be both long-term and short-term, so they
are different than the 20 that I report on daily.
BULL SIGNS
-The 10-dMA percentage of issues advancing on the NYSE (Breadth) is above 50%.
-MACD of S&P 500 price made a bullish crossover 13 Oct.
-MACD of the percentage of issues advancing on the NYSE (breadth) made a bullish crossover 26 Oct.
-The 52-week, New-high/new-low ratio improved by 3.5 standard deviations. More simply, the spread between new-highs and new-lows improved by 716 on 14 October. That’s another solid bottom sign at a retest.
-Short-term new-high/new-low data.
-Long-term new-high/new-low data.
-McClellan Oscillator.
-Smoothed Buying Pressure minus Selling Pressure is rising.
-On average, the size of up-moves has been larger than the size of down-moves over the last month.
-21 Oct was a Bullish Outside Reversal Day.
-My Money Trend indicator turned up.
-The Smart Money (late-day action) is up.
-Cyclical Industrials (XLI-ETF) are outpacing the S&P 500.
-The 5-10-20 Timer System is BUY; the 5-dEMA and 10-dEMA are both above the 20-dEMA. (The 5-day is above the 10-day so short-term momentum is bullish.)
-Slope of the 40-dMA of New-highs is rising.
-S&P 500 is outperforming the Utilities (XLU).
-The graph of the 100-day Count (the 100-day sum of up-days) is up.
-The Calm-before-the-Storm/Panic Indicator flashed a panic-buying signal 10 November.
-The smoothed advancing volume on the NYSE is rising.
-10 and 11 Nov were high up-volume days at 87% and 77%. That’s close enough to back-to-back 80% up-volume days, so I’ll call this one bullish.
-VIX indicator.
-58% of the 15-ETFs that I track have been up over the last 10-days.
NEUTRAL
-Issues advancing on the NYSE (Breadth) compared to the S&P 500 are flat. (Breadth is neutral to the Index.)
-There was a Follow-through Day 10 November, but 1 is not enough to give a signal.
-There have been 4 Statistically-Significant days (big moves in price-volume) in the last 15-days.
-Sentiment.
-Overbought/Oversold Index (Advance/Decline Ratio).
-The short-term, 10-day, Fosback Hi-Low Logic Index.
-The longer-term, 50-dEMA, Fosback Hi-Low Logic Index is neutral.
-RSI
-There have been 11 up-days over the last 20 sessions.
-There have been 5 up-days over the last 10 sessions – neutral.
-The S&P 500 is 2.2% below its 200-dMA. (Bull indicator is 12% below the 200-day, although this is based on “normal” pullbacks.)
-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.
-There was a Hindenburg Omen signal 8 April – expired.
-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 2022. (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
BEAR SIGNS
-Bollinger Bands - overbought.
-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% giving me a “correction-now” signal. – Tell me something I didn’t know.
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 4 bear-signs and 22-Bull. Last week, there were 6 bear-signs and 16
bull-signs. Friday indicators are at extreme bullish levels.
Today, the daily sum of 20 Indicators rose from +11 to +13
(a positive number is bullish; negatives are bearish); the 10-day smoothed sum
that smooths the daily fluctuations slipped from +84 to +82. (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 BUY: SENTIMENT is neutral; VIX, VOLUME & PRICE
are bullish. (The important Buy signal
from this indicator ensemble was 21 October (7 days after the low); my first
buy indication was on 21 September (2% above the low) based on analysis of
retests of the June low.)
Bottom line: I’m a Bull. I think the bottom was 3577 on
12 October. There is always the possibility that the markets could retest those
lows, but it seems less likely that a retest will occur in 2022.
I’m now invested with about 75% of the portfolio invested
in stocks. (As a retiree, 50% invested in stocks is my “normal” portfolio.) 75%
stocks is uber-bullish and that’s as far as I’ll go.
BEST ETFs - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily)
ETF ranking follows:
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.
*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)
DOW 30 momentum ranking follows:
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
FRIDAY MARKET INTERNALS (NYSE
DATA)
My basket of Market Internals improved too BUY.
(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 75% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks. I’ll cut back on stocks if we see serious
bear signs.
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.
https://michaelpramirez.com/index.html
“Consumer sentiment fell about 9% below October, erasing about half of the gains that had been recorded since the historic low in June...Overall, declines in sentiment were observed across the distribution of age, education, income, geography, and political affiliation...Inflation expectations are little changed. The median expected year-ahead inflation rate was 5.1%, up from 5.0% last month. Long run inflation expectations, currently at 3.0%, have remained in the narrow (albeit elevated) 2.9-3.1% range for 15 of the last 16 months.” Press release at
http://www.sca.isr.umich.edu/
“I viewed the October 13th bottom as one of at least significance, if not the final bear market low...I have written that three things need to happen for the bear market to be over. The U.S. dollar needs to peak. [It appears to have peaked.] The 10-Year Note needs to go down. [Done] We are now waiting on the 2-Year Note to follow suit.” – Paul Schatz, President Heritage Capital. Commentary at...
https://investfortomorrow.com/blog/a-crypto-era-ends-and-not-well/
-Friday the S&P 500 rose 0.9% to 3993.
-VIX fell about 4% to 22.52.
-The yield on the 10-year Treasury were unchanged at 3.819%.
-Drop from Top: 16.8% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 217-days.
The S&P 500 is 2.2% Below its 200-dMA & 5.3% ABOVE its 50-dMA.
*I won’t call the correction over until the S&P 500 makes a new-high; however, evidence suggests the bottom was in the 3600 area and I am fully invested with a higher percentage of stocks than normal.
XLI – Industrial ETF (XLI still looks good to me. Nearly 10% of XLI is in Boeing and Caterpillar and they are both strong performers in the DOW momentum analysis.)
QLD – 2x Nas 100
DDM – 2x Dow 30
XLK – Technology ETF
My VIX indicator turned bullish today. VIX has been slow to confirm the move higher so it is good to see this indicator join the party. On a more cautious note...
-The 10-dMA percentage of issues advancing on the NYSE (Breadth) is above 50%.
-MACD of S&P 500 price made a bullish crossover 13 Oct.
-MACD of the percentage of issues advancing on the NYSE (breadth) made a bullish crossover 26 Oct.
-The 52-week, New-high/new-low ratio improved by 3.5 standard deviations. More simply, the spread between new-highs and new-lows improved by 716 on 14 October. That’s another solid bottom sign at a retest.
-Short-term new-high/new-low data.
-Long-term new-high/new-low data.
-McClellan Oscillator.
-Smoothed Buying Pressure minus Selling Pressure is rising.
-On average, the size of up-moves has been larger than the size of down-moves over the last month.
-21 Oct was a Bullish Outside Reversal Day.
-My Money Trend indicator turned up.
-The Smart Money (late-day action) is up.
-Cyclical Industrials (XLI-ETF) are outpacing the S&P 500.
-The 5-10-20 Timer System is BUY; the 5-dEMA and 10-dEMA are both above the 20-dEMA. (The 5-day is above the 10-day so short-term momentum is bullish.)
-Slope of the 40-dMA of New-highs is rising.
-S&P 500 is outperforming the Utilities (XLU).
-The graph of the 100-day Count (the 100-day sum of up-days) is up.
-The Calm-before-the-Storm/Panic Indicator flashed a panic-buying signal 10 November.
-The smoothed advancing volume on the NYSE is rising.
-10 and 11 Nov were high up-volume days at 87% and 77%. That’s close enough to back-to-back 80% up-volume days, so I’ll call this one bullish.
-VIX indicator.
-58% of the 15-ETFs that I track have been up over the last 10-days.
-Issues advancing on the NYSE (Breadth) compared to the S&P 500 are flat. (Breadth is neutral to the Index.)
-There was a Follow-through Day 10 November, but 1 is not enough to give a signal.
-There have been 4 Statistically-Significant days (big moves in price-volume) in the last 15-days.
-Sentiment.
-Overbought/Oversold Index (Advance/Decline Ratio).
-The short-term, 10-day, Fosback Hi-Low Logic Index.
-The longer-term, 50-dEMA, Fosback Hi-Low Logic Index is neutral.
-RSI
-There have been 11 up-days over the last 20 sessions.
-There have been 5 up-days over the last 10 sessions – neutral.
-The S&P 500 is 2.2% below its 200-dMA. (Bull indicator is 12% below the 200-day, although this is based on “normal” pullbacks.)
-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.
-There was a Hindenburg Omen signal 8 April – expired.
-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 2022. (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
-Bollinger Bands - overbought.
-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% giving me a “correction-now” signal. – Tell me something I didn’t know.
BEST ETFs - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily)
ETF ranking follows:
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
DOW 30 momentum ranking follows:
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 improved too BUY.
(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.)
