Payroll Report ... Unemployment Rate ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
PAYROLL REPORT / UNEMPLOYMENT RATE (Yahoo Finance)
“The April jobs report showed the US labor market remains robust, with more than a quarter million new jobs added to the economy last month as the unemployment rate fell to match its lowest level since May 1969. The US economy added 253,000 nonfarm payroll jobs last month, with the unemployment rate unexpectedly dropping to 3.4%...” Story at...
https://finance.yahoo.com/news/april-jobs-report-may-5-2023-215956320.html
 
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose about 1.9% to 4136.
-VIX fell about 14% to 17.19.
-The yield on the 10-year Treasury slipped to 3.344%.
 
PULLBACK DATA:
-Drop from Top: 13.9% as of Friday. 25.4% max (on a closing basis).
-Trading Days since Top: 336-days.
The S&P 500 is 4.2% ABOVE its 200-dMA and 2.3% 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 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.
XLK – Technology ETF.
XLE – Energy Sector ETF. It been sagging recently on lower oil prices. 
 
BA – Boeing reported 4/26/2023. It had good numbers and gave good guidance.  BA bounced on the news, but still hasn’t done much recently. I plan to sell it and buy Microsoft which I expect will outperform Boeing.
 
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:
Here’s my weekly review of indicators:
The weekly rundown of indicators shifted toward the Bear side this week, but is close to neutral (now 12-bear and 10-bull). (These indicators tend to be both long-term and short-term, so they are different than the 20 that I report on daily.) 
 
BULL SIGNS
-The smoothed advancing volume on the NYSE is rising.
-Smoothed Buying Pressure minus Selling Pressure is rising.
-My Money Trend indicator is rising.
-The 100-dMA percentage of issues advancing on the NYSE (Breadth) is above 50%.
-MACD of the percentage of issues advancing on the NYSE (breadth) made a bullish crossover 19 April.
-Long-term new-high/new-low data.
-The graph of the 100-day Count (the 100-day sum of up-days) is up.
-On average, the size of up-moves has been larger than the size of down-moves over the last month.
-VIX indicator.
-The 5-10-20 Timer System is BUY.
 
NEUTRAL
-There have only been 2 Distribution Days since the last Follow-thru Day.
-There have been 5 Statistically-Significant days (big moves in price-volume) in the last 15-days. It is not clear that we are at a top or bottom so I’ll put this in the neutral column.
-Sentiment.
-Bollinger Bands.
-Overbought/Oversold Index (Advance/Decline Ratio).
-Bollinger Band Squeeze 28 April - expired.
-Issues advancing on the NYSE (Breadth) compared to the S&P 500.
-The long-term, 50-dEMA, Fosback Hi-Low Logic Index is neutral.
-The short-term, 10-day EMA, Fosback Hi-Low Logic Index is neutral.
-There have been 4 up-days over the last 10 sessions – neutral.
-There have been 9 up-days over the last 20 sessions - neutral.
-The S&P 500 is 4.2% above its 200-dMA. (Bear indicator is 12% above the 200-day.)
-12 April there was a Bearish Outside Reversal Day – expired.
-There was a Zweig Breadth Thrust 31 March. That’s a rare, very-bullish sign, but the McClellan Oscillator turned negative, so this indicator has expired.
-RSI
-There was a 90% down-volume day 9 March. Another one will push this into the Bear category.
-The Calm-before-the-Storm/Panic Indicator flashed a panic-buying signal 10 November - expired.
-2.8% of all issues traded on the NYSE made new, 52-week highs when the S&P 500 made a new all-time-high, 3 January 2022. (There is no bullish signal for this indicator.) This indicated that the advance was too narrow and a correction was likely to be >10%. It proved correct, but is now Expired.
-S&P 500 is even vs. Utilities (XLU-ETF) - neutral.
 
BEAR SIGNS
-The 10-dMA percentage of issues advancing on the NYSE (Breadth) is below 50%.
-The 50-dMA percentage of issues advancing on the NYSE (Breadth) is below 50%.
-The 50-dMA percentage of issues advancing on the NYSE (Breadth) has been below 50%, for more than 3 days in a row – bearish.
-MACD of S&P 500 price made a bearish crossover 25 April.
-Short-term new-high/new-low data.
-McClellan Oscillator.
-There was a Hindenburg Omen signal 3 May 2023. (Good for 30-days or until McClellan Oscillator turns positive.)
-Slope of the 40-dMA of New-highs is falling.
-The Smart Money (late-day action) is falling sharply.
-XLI-ETF (Cyclical Industrials) is underperforming the S&P 500.
-The 5-day EMA is below the 10-day EMA so short-term momentum is bearish.
-45% of the 15-ETFs that I track have been up over the last 10-days.
 
On Friday, 21 February, 2 days after the top before the Coronavirus pullback, there were 10 bear-signs and 1 bull-sign. Now there are 12 bear-signs and 10-Bull. Last week, there were 9 bear-sign and 15 bull-signs.
 
Today was a statistically significant up-day. That just means that the price-volume move exceeded my statistical parameters. Statistics show that a statistically-significant, up-day is followed by a down-day about 60% of the time. 
 
Friday, the daily spread of 20 Indicators (Bulls minus Bears) improved from -11 to zero (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations improved from -49 to -48. (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 improved to 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 am still a cautious Bull. Indicators are not that bad, in spite of the Hindenburg Omen.
 
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
 
FRIDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals improved to 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 65% 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.