Productivity ... Crude Inventories ... Best DOW Stocks ... Best ETFs … Stock Market Analysis ...

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
“Herschel Walker, the Heisman Trophy winner who led the Georgia Bulldogs to a national championship in 1982, just wrote Donald Trump’s political obituary...Having suffered the rare humiliation of failing to win a second term in the Oval Office, and having cost his party a majority in the senate – three times – it is time for Donald Trump to step away from politics. It is the right thing to do for his party, for the country, and for himself.” Liz Peek, Fox News Contributor 
(FOX is finally beginning to turn away from Trump.  Of course, there’s still a chance that they will lose the billion-dollar lawsuit for their support for the stolen-election, rigged voting machines story.)
 
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 5.2 million barrels from the previous week. At 413.9 million barrels, U.S. crude oil inventories are about 9% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
 
PRODUCTIVITY (YahooFinance)
“Productivity was revised — for the final time — to +0.8%, 10 basis points (bps) higher than expected, and a solid jump from the +0.3% reported the last time around. This quarterly rise marks the best quarter of productivity since Q4 2021. And as any economist can tell you, productivity is the key between higher prices and inflation: with higher productivity we see less inflation, even with higher prices.” Story at...
https://finance.yahoo.com/news/q3-productivity-labor-costs-revised-155703758.html
 
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 dropped about 0.2% to 3934.
-VIX rose about 2% to 22.63. (VIX has been rising but my VIX indicator is still bullish; VIX hasn’t risen very fast so far.)
-The yield on the 10-year Treasury rose to 3.456%.
 
PULLBACK DATA:
-Drop from Top: 18% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 233-days.
The S&P 500 is 2.6% BELOW its 200-dMA & 2.7% above its 50-dMA. It’s slightly above its 100-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), but for now, the DOW 30 is still doing better than 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:
The S&P 500 is sitting just above its 100-dMA, so that’s a line we need to hold.  Both the 100-day and the lower trend line are at that now critical approximate 3900 level. A lot of indicators are rolling over to the bear side, but there are still some critical bull signs. Importantly, there have only been 7 up-days in the last 20 and only 2 in the last 10.  Those indicate an oversold overbought, bullish, market-condition. The S&P 500 is at its lower trendline, suggesting a reversal is possible. We also saw High unchanged-volume Wednesday.
 
As I’ve often said, many believe that this indicator suggests investor confusion at market turning points. Unfortunately, it is frequently a false signal, but this indicator has been mostly correct recently. Now it may be suggesting a bounce higher.
 
The S&P 500 closed near its lower trend line so we don’t want to see it fall much further. As I’ve noted for a while, 3900 remains a key level for the S&P 500 since it represents the lower trend-line of the current up-trend.
 
Today, the daily sum of 20 Indicators declined from +11 to +7 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations declined from +150 to 138. (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 and VOLUME are neutral; VIX, & 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 27 September (2% above the low) based on analysis of retests of the June low.)
 
Bottom line: I remain a Bull. I am watching for a turn upward soon; if 3900 doesn’t hold, I’ll be cutting back on stock holdings, but perhaps not immediately. As previously noted,
I think the bottom was 3577 on 12 October. There is always the possibility that the markets could retest those lows, but it seems unlikely 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
 
WEDNESDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals declined to SELL. That’s a warning; I’ll look at other signs before I do any selling.
(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.