“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“Researchers from the University of Zadar in Croatia
discovered the road...The team says the road once connected Korčula Island to
an artificially made island settlement called Soline, which is now nearly 16
feet below the water’s level. Researchers believe this was all an active site
roughly 7,000 years ago.”
Archeologists Discover Underwater City With Stone Roads Dating Back Thousands of Years | Watch (msn.com)
My cmt: What!? sea levels were rising before Global Warming?
CPI / CORE CPI (CNBC)
“The consumer price index, which measures the cost of a broad swath of goods and services, increased 0.4% for the month, in line with the Dow Jones estimate, according to a Labor Department report Wednesday. However, that equated to an annual increase of 4.9%, slightly less than the 5% estimate and the lowest annual pace since April 2021... core CPI rose 0.4% monthly and 5.5% from a year ago, both in line with expectations.” Story at...
https://www.cnbc.com/2023/05/10/cpi-inflation-april-2023.html
CRUDE OIL INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 3.0 million barrels from the previous week. At 462.6 million barrels, U.S. crude oil inventories are about 1% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
NASDAQ A/D LINE DIVERGENCE (McClellan Financial
Publications)
“...This negative bias stems from the fact that the
Nasdaq has looser listing standards than the NYSE (the A-D Line for which is
very useful). If a stock is going to come public and then go broke, it is
more likely to do that on the Nasdaq, and every down day from IPO to delisting
contributes to the Declines column...I will note that the overall Nasdaq's A-D
Line this week made another new all-time low. So it is definitely NOT
saying that there is hidden strength in the market.” Commentary at...
https://www.mcoscillator.com/learning_center/weekly_chart/nasdaq_100_a-d_line_divergence/
THE TIME IS RIGHT FOR NUCLEAR FUSION (Oil Price.com)
“A powerful combination of scientific breakthroughs, private and public funding, and governmental support has drastically changed the outlook for commercial nuclear fusion. Just ten years ago, reporters and industry experts alike were still joking that “Nuclear fusion is 30 years away...and always will be.” Now, seemingly very suddenly, the narrative has shifted from a conversation about “if” to one about “when.” Instead of postulating that we may possibly see reliable and scalable ignition in our lifetimes, experts are now saying that we could see pilot nuclear power plants within a decade.” Story at...
https://oilprice.com/Energy/Energy-General/The-Time-Is-Finally-Right-For-Nuclear-Fusion.html
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 0.5% to 4138.
-VIX dipped about 4% to 16.94.
-The yield on the 10-year Treasury slipped to 3.445%.
PULLBACK DATA:
-Drop from Top: 13.7%. 25.4% max (on a closing basis).
-Trading Days since Top: 338-days.
The S&P 500 is 4.1% ABOVE its 200-dMA and 2.1% 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 we called a buy on 4 October 2022.
MY TRADING POSITIONS:
I am not trading as much as in the past. You may wish to use the momentum charts and/or the Monday 40-day gain charts for trading the Dow stocks and ETFs.
BA – SOLD Boeing 5/10/2023.
MSFT – Added Microsoft 5/10/2023.
XLK – Technology ETF.
XLE – Energy Sector ETF. It been sagging recently on lower oil prices.
XLY - Consumer Discretionary ETF.
KRE – Regional Banking ETF. This is a very small position for me.
SHY – Short term bonds. 30-day yield is 4%. (Trailing 1-year yield is 1.6%.) I’ll hold this, but if the market retests the lows, I’ll sell it and buy stocks.)
TODAY’S COMMENT:
Breadth continues to be a problem. The 10, 20, & 50 day-Moving Averages of the percentage of issues advancing on the NYSE are all below 50%. So, in those time frames, less than half of the issues have been going up. Those are poor numbers. That’s one reason that when the 50-dMA of issues advancing on the NYSE is less than 50% for 3-consecutive days, I consider it a bearish correction warning. It went bearish 6 April and has stayed bearish; it is not always right, but it still might be.
We also like to see new-highs increasing when the S&P
500 is making new highs. This can be a telling stat when the Index makes a new
all-time high, but interim-highs can give us an idea of bullish strength. Now,
the news is not so good. At the new high on 2 February (4180), 6.8% of issues
made new highs. At the recent bounce high (4169) only 2.4% of issues on the
NYSE made new highs.
These are important signs of poor breadth. So far, other
indicators have not joined the bearish party.
Our recent Friday Summary of indicators was basically neutral to
slightly bearish, so I am not increasing stock percentages, however, I did swap
Microsoft for Boeing. Still, there was a
strong new, bullish-sign.
Today, was a Bullish Outside Reversal Day.
“Outside days are days where a security’s price is more volatile than the previous day. On an outside day, a security's price will reach a higher high and a lower low than the previous day. Outside days are a two-day price pattern; the difference between the open and close on the second day is larger than the first day when the open and close of the second day are outside the range of the first day.” From
https://www.investopedia.com/terms/o/outside-days.asp
It is bullish if the move is higher as it was yesterday. I don’t see this signal very often, but it seems to be a pretty good indicator. It occurred the day after the October bottom, again 6-days after that bottom and one additional time during the rally.
Friday, the daily spread of 20 Indicators (Bulls minus
Bears) improved from +4 to +6 (a positive number is bullish; negatives
are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved
from -32 to -18. (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: PRICE & VIX are positive; SENTIMENT & VOLUME are neutral.
(The important BUY in this indicator was on 21 October,
7-days after the bottom. For my NTSM overall signal, I suggested that a
short-term buying opportunity occurred on 27 September (based on improved
market internals on the retest), although without market follow-thru, I was
unwilling to call a buy; however, I did close shorts and increased stock
holdings. I issued a Buy-Signal on 4 October, 6-days before the final bottom,
based on stronger market action that confirmed the market internals signal. The
NTSM sell-signal was issued 20 December, 8 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I remain a cautious Bull.
ETF - 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 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 improved to 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 cmt: What!? sea levels were rising before Global Warming?
“The consumer price index, which measures the cost of a broad swath of goods and services, increased 0.4% for the month, in line with the Dow Jones estimate, according to a Labor Department report Wednesday. However, that equated to an annual increase of 4.9%, slightly less than the 5% estimate and the lowest annual pace since April 2021... core CPI rose 0.4% monthly and 5.5% from a year ago, both in line with expectations.” Story at...
https://www.cnbc.com/2023/05/10/cpi-inflation-april-2023.html
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 3.0 million barrels from the previous week. At 462.6 million barrels, U.S. crude oil inventories are about 1% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
https://www.mcoscillator.com/learning_center/weekly_chart/nasdaq_100_a-d_line_divergence/
“A powerful combination of scientific breakthroughs, private and public funding, and governmental support has drastically changed the outlook for commercial nuclear fusion. Just ten years ago, reporters and industry experts alike were still joking that “Nuclear fusion is 30 years away...and always will be.” Now, seemingly very suddenly, the narrative has shifted from a conversation about “if” to one about “when.” Instead of postulating that we may possibly see reliable and scalable ignition in our lifetimes, experts are now saying that we could see pilot nuclear power plants within a decade.” Story at...
https://oilprice.com/Energy/Energy-General/The-Time-Is-Finally-Right-For-Nuclear-Fusion.html
-Wednesday the S&P 500 rose about 0.5% to 4138.
-VIX dipped about 4% to 16.94.
-The yield on the 10-year Treasury slipped to 3.445%.
-Drop from Top: 13.7%. 25.4% max (on a closing basis).
-Trading Days since Top: 338-days.
The S&P 500 is 4.1% ABOVE its 200-dMA and 2.1% 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 we called a buy on 4 October 2022.
I am not trading as much as in the past. You may wish to use the momentum charts and/or the Monday 40-day gain charts for trading the Dow stocks and ETFs.
MSFT – Added Microsoft 5/10/2023.
XLE – Energy Sector ETF. It been sagging recently on lower oil prices.
XLY - Consumer Discretionary ETF.
KRE – Regional Banking ETF. This is a very small position for me.
SHY – Short term bonds. 30-day yield is 4%. (Trailing 1-year yield is 1.6%.) I’ll hold this, but if the market retests the lows, I’ll sell it and buy stocks.)
Breadth continues to be a problem. The 10, 20, & 50 day-Moving Averages of the percentage of issues advancing on the NYSE are all below 50%. So, in those time frames, less than half of the issues have been going up. Those are poor numbers. That’s one reason that when the 50-dMA of issues advancing on the NYSE is less than 50% for 3-consecutive days, I consider it a bearish correction warning. It went bearish 6 April and has stayed bearish; it is not always right, but it still might be.
“Outside days are days where a security’s price is more volatile than the previous day. On an outside day, a security's price will reach a higher high and a lower low than the previous day. Outside days are a two-day price pattern; the difference between the open and close on the second day is larger than the first day when the open and close of the second day are outside the range of the first day.” From
https://www.investopedia.com/terms/o/outside-days.asp
It is bullish if the move is higher as it was yesterday. I don’t see this signal very often, but it seems to be a pretty good indicator. It occurred the day after the October bottom, again 6-days after that bottom and one additional time during the rally.
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
