Jobless Claims ... ADP employment ... Crude Oil Inventories ... Best DOW Stocks ... Best ETFs … Stock Market Analysis ...
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
ADP EMPLOYMENT ADP (ADP)
“Private employers added 235,000 jobs in December.
Job resurgence was seen in the last two months of 2022
led by consumer-facing service industries. Hiring was strong across small and
medium establishments while large establishments saw a drop in employment of
151,000 jobs.” Story at...
https://adpemploymentreport.com/
JOBLESS CLAIMS (CNN)
“Around 204,000 people applied for first-time
unemployment benefits last week, according to the latest data from the Bureau
of Labor Statistics. That’s down from the previous week’s total jobless claims
and only slightly below the pre-pandemic weekly average of 218,000.” Story
at...
https://www.cnn.com/2023/01/05/economy/weekly-jobless-claims-december-31/index.html
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 1.7 million barrels from the
previous week. At 420.6 million barrels, U.S. crude oil inventories are about
4% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 fell about 1.2% to 3808.
-VIX rose about 2% to 22.46
-The yield on the 10-year Treasury rose to 3.719%.
PULLBACK DATA:
-Drop from Top: 20.6% as of today. 25.4% max (on a
closing basis).
-Trading Days since Top: 253-days.
The S&P 500 is 4.8% BELOW its 200-dMA & 2.4%
BELOW 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:
I am doing less trading now. You may do better watching
the momentum charts rather than my moves.
XLK – Technology ETF. (The S&P 500 is not far from
its prior lows so I am holding this position, even though it is now a losing
one.)
TODAY’S COMMENT:
The Junk Bond spread is showing bullish divergence; My Money
Trend indictor turned up; New-Hi/New-lo data is improving. Perhaps this
downtrend will take a break? Let’s wait until tomorrow and see what the Friday summary of
many of the NTSM indicators tells us.
The S&P 500 is about 5% above its October closing low
and the S&P 500 remains below its 50-dMA. I still think that the most
likely scenario will see the S&P 500 test its prior correction low.
The 50-dMA is the key for me; if the S&P 500 can
climb above its 50-dMA and remain for consecutive days, I’ll be adding to stock
holdings.
Today, the daily sum of 20 Indicators declined from +12
to +9 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations increased from +54 to 57. (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: VIX, VOLUME, PRICE & SENTIMENT are all neutral.
Bottom line: I’m a Bear at this point. I am defensively
positioned in the markets, but not drastically so. There was a successful test
and buy signal 27 September, so I need to be careful not to get too bearish.
Perhaps cautious is a better word than bearish.
I’m now have about 40% of the portfolio invested in
stocks. (As a retiree, 50% invested in stocks is my “normal” portfolio.) I was
75% invested in stocks in early December.
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
THURSDAY 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 40% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks. Last week’s Friday-run-down indicator
ensemble was bad enough to convince me to take a more conservative view of the
markets.
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.
