“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
CHICAGO PMI (Advisor Perspectives)
“The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, dropped to 44.3 in January from 44.9 in December, marking the fifth straight month in contraction territory. Values above 50.0 indicate expanding manufacturing activity. This reading comes in below the Investing.com forecast of 45.0.” Commentary & Charts at...
https://www.advisorperspectives.com/dshort/updates/2023/01/31/chicago-pmi-down-in-january-worse-than-forecast?topic=economic-insights
My cmt: The number was in the 30’s in November.
CONSUMER CONFIDENCE (Conference Board via pr newswire)
“The Conference Board Consumer Confidence Index® decreased in January following an upwardly revised increase in December 2022. The Index now stands at 107.1 (1985=100), down from 109.0 in December (an upward revision)..."Consumers' assessment of present economic and labor market conditions improved at the start of 2023. However, the Expectations Index retreated in January reflecting their concerns about the economy over the next six months. Consumers were less upbeat about the short-term outlook for jobs. They also expect business conditions to worsen in the near term. Despite that, consumers expect their incomes to remain relatively stable in the months ahead.” Story at...
https://www.prnewswire.com/news-releases/us-consumer-confidence-declined-in-january-301734825.html
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 1.5% to 4077.
-VIX declined about 2.7% to 19.40.
-The yield on the 10-year Treasury slipped to 3.511%.
PULLBACK DATA:
-Drop from Top: 15% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 270-days.
The S&P 500 is 3.1% ABOVE its 200-dMA & 3.3% 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.
MY TRADING POSITIONS:
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.
XLK – Technology ETF.
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. (I considered selling XLY. But it was a top performer 31 Jan, so I’ll continue to watch it.)
SHY – Short term bonds. 30-day yield is 4.2%. (Trailing 1-year yield is 1.3%.) I’ll hold this, but if the market retests the lows, I’ll sell it and buy stocks.)
TODAY’S COMMENT:
Today, was a bullish, high up-volume day. 90% of the volume was up-volume and the S&P 500 index finished in the upper 10% its range for the day. That’s a nice bullish follow-thru sign that tends to confirm my bullish view.
XLK (SPDR Technology ETF) bottomed in October at about
the same time as the S&P 500. Over
40% of the XLK-ETF is invested in Apple & Microsoft, so XLK is a big tech ETF.
YTD, the XLK is 4.3% ahead of the S&P 500. In spite
of that, the CNBC crowd continues to say that Big Tech should be avoided due to
valuation concerns. I don’t get it. Valuation is not a good timing tool. I
think the Pros know that. All I can say is that I’m taking the other side of
the trade. Go with what’s working. I have Technology exposure in XLK and QLD (2x
Nasdaq 100) as well as thru the SPY (S&P 500 ETF).
Today, the daily sum of 20 Indicators improved from +1 to
+3 (a positive number is bullish; negatives are bearish); the 10-day smoothed
sum that smooths the daily fluctuations decreased from +52 to 41. (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 HOLD, but the indicator is improving: PRICE is positive. VOLUME, VIX
& SENTIMENT are neutral.
(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.)
Bottom line: I’m a BULL.
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
TUESDAY MARKET INTERNALS (NYSE
DATA)
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 75% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks.
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.
“The latest Chicago Purchasing Manager's Index, or the Chicago Business Barometer, dropped to 44.3 in January from 44.9 in December, marking the fifth straight month in contraction territory. Values above 50.0 indicate expanding manufacturing activity. This reading comes in below the Investing.com forecast of 45.0.” Commentary & Charts at...
https://www.advisorperspectives.com/dshort/updates/2023/01/31/chicago-pmi-down-in-january-worse-than-forecast?topic=economic-insights
My cmt: The number was in the 30’s in November.
“The Conference Board Consumer Confidence Index® decreased in January following an upwardly revised increase in December 2022. The Index now stands at 107.1 (1985=100), down from 109.0 in December (an upward revision)..."Consumers' assessment of present economic and labor market conditions improved at the start of 2023. However, the Expectations Index retreated in January reflecting their concerns about the economy over the next six months. Consumers were less upbeat about the short-term outlook for jobs. They also expect business conditions to worsen in the near term. Despite that, consumers expect their incomes to remain relatively stable in the months ahead.” Story at...
https://www.prnewswire.com/news-releases/us-consumer-confidence-declined-in-january-301734825.html
-Tuesday the S&P 500 rose about 1.5% to 4077.
-VIX declined about 2.7% to 19.40.
-The yield on the 10-year Treasury slipped to 3.511%.
-Drop from Top: 15% as of today. 25.4% max (on a closing basis).
-Trading Days since Top: 270-days.
The S&P 500 is 3.1% ABOVE its 200-dMA & 3.3% 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.
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.
XLK – Technology ETF.
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. (I considered selling XLY. But it was a top performer 31 Jan, so I’ll continue to watch it.)
SHY – Short term bonds. 30-day yield is 4.2%. (Trailing 1-year yield is 1.3%.) I’ll hold this, but if the market retests the lows, I’ll sell it and buy stocks.)
Today, was a bullish, high up-volume day. 90% of the volume was up-volume and the S&P 500 index finished in the upper 10% its range for the day. That’s a nice bullish follow-thru sign that tends to confirm my bullish view.
(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.)
Bottom line: I’m a BULL.
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
