PPI/Core PPI ... Empire State Manufacturing ... Best DOW Stocks ... Best ETFs … Stock Market Analysis ...

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 

Political commentary at...
https://michaelpramirez.com/index.html
 
PPI / CORE PPI (CNN)
“A key measure of inflation, wholesale prices, rose by 8% in October from a year before, according to the latest report from the Bureau of Labor Statistics. While still historically high, it was the smallest increase since July of last year and significantly better than forecasts...On a monthly basis, producer prices rose 0.2%, below expectations and even with the revised 0.2% increase seen in September. Year-over-year, core PPI — which excludes food and energy, components whose pricing is more prone to market volatility — measured 6.7%, down from September’s revised annual increase of 7.1%.” Story at...
https://www.cnn.com/2022/11/15/economy/us-ppi-inflation-october/index.html
 
EMPIRE STATE MANUFACTURING (NewYork Fed)
“Business activity edged slightly higher in New York State, according to firms responding to the November 2022 Empire State Manufacturing Survey. The headline general business conditions index climbed fourteen points to 4.5... Looking ahead, firms expect business conditions to worsen over the next six months.” Report at...
https://www.newyorkfed.org/medialibrary/media/survey/empire/empire2022/esms_2022_11.pdf?la=en
A number above zero indicates improving conditions.
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose 0.9% to 3992.
-VIX rose about 3% to 24.54.
-The yield on the 10-year Treasury dipped to 3.782%.
 
PULLBACK DATA:
-Drop from Top: 17.5% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 219-days.
The S&P 500 is 2.1% Below its 200-dMA & 5.2% 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. I may sell DDM and replace it with SSO (2x S&P 500). The DOW 30 seems to be fading a little compared to the S&P 500.
XLK – Technology ETF
 
CVX – (I may hold this as a long-term position. I already owned a small position in CVX.)
 
TODAY’S COMMENT:
PPI was lower than expected. Financial news is good and so far, technicals are good too.  Markets can go higher. 
 
We’ll need to see what the NATO response is to reports that Russian missiles landed in Poland. Reports were that the missiles destroyed grain storage facilities and killed Polish citizens. Markets reacted negatively and fell around 1% when the news came out. Markets recovered some later in the day, but didn’t get back to their daily highs. I won’t make any changes to portfolios at this time due to the Polish/Ukraine news.

 
Today, the daily sum of 20 Indicators dipped from +13 to +10 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved from +83 to +85. (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; VOLUME & PRICE are bullish; VIX is neutral.  (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
XLE has taken the top position in the ETF momentum index. I own CVX so I already have good exposure to energy.
 
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
 
TUESDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals remained 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.