“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
“Private sector firms in the US registered a further decline in output at the start of 2023, according to latest ‘flash’ PMI™ data from S&P Global. The fall in business activity softened to the slowest in three months, however, as manufacturers and service providers signaled moderations in their respective downturns...Meanwhile, business confidence strengthened at the start of the year. Despite still being below the historic series trend, the degree of optimism was the highest for four months. The pick-up in positive sentiment was broad based, with companies hopeful of a resurgence in customer demand as 2023 progresses.” Press release at...
https://www.pmi.spglobal.com/Public/Home/PressRelease/40a5dc326b7f46e5a97c9033771d30ff
“The strong showing for stocks in January is putting the bear market that started last year "on thin ice," according to Fundstrat's technical strategist Mark Newton...And while the gains could falter in the coming weeks as corporate earnings roll in, it still looks like "an important structural positive which likely turns the trend higher between early February and mid-March," Newton said.” Story at...
The bear market in stocks is 'on thin ice' as improving technicals challenge the narrative that a recession is near, Fundstrat says (msn.com)
My cmt: We identified the bottom in September (2% early) and it looks like the final bottom was 12 October.
-Tuesday the S&P 500 rose about 0.1% to 4017.
-VIX fell about 3% to 19.20.
-The yield on the 10-year Treasury dipped to 3.464%.
-Drop from Top: 16.3% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 264-days.
The S&P 500 is 1.3% ABOVE its 200-dMA & 2.0% 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.
QLD – (2xNas 100) The XLK bottomed 12 October, about the same time as when the S&P 500 retested its low. QLD seems like a decent bet even though the CNBC crowd doesn’t like Tech. We’ll see.
SSO – 2x S&P 500.
XLE – Energy Sector ETF. Low PE; good Dividend; decent momentum.
BA – (Boeing) I am late on this one, but we’ll see.
XLY - Consumer Discretionary ETF.
There was low volume today on the NYSE, about 10% below the average for the month. Looks like investors were waiting to see the Microsoft earnings report. Microsoft was down during normal hours, but Microsoft was up 4% at 4:30 in afterhours trading - investors liked the report. Revenues missed expectations, but earnings were up. All-in-all, we can conclude results were better than the fear-factor built into the price of the stock. I suspect this will carry over into the market Wednesday and we may see Technology in general continue to improve relative to the markets.
(The important BUY in this indicator was on 21 October, 7-days after the bottom. My NTSM buy-signal was 27 September, based on improved internals at the retest low, about 2% before the bottom.)
At least one Bear sign remains: The Advance / Decline Ratio is overbought, so some short-term weakness is possible. Right now, though, I wouldn’t be surprised to see some fear of missing out (FOMO) buying get going.
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
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
