“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“I believe that children are our future. Unless we stop them
now.” – Homer Simpson.
“I view the debt ceiling agreement as more of a selling
opportunity than buying one, especially in the indices and sectors that have
gone up so much lately. I am not saying that I wouldn’t buy anything here, but
I am much more disposed to reduce exposure and/or rotate to some better risk/reward
ideas.” – Paull Schatz, President, Heritage Capital.
ADP EMPLOYMENT (ADP via prnewswire)
“Private sector employment increased by 278,000 jobs in May and annual pay was up 6.5 percent year-over-year, according to the May ADP® National Employment Report™ produced by the ADP Research Institute® in collaboration with the Stanford Digital Economy Lab ("Stanford Lab")...said Nela Richardson, chief economist, ADP. "Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring." Report at..
https://www.prnewswire.com/news-releases/adp-national-employment-report-private-sector-employment-increased-by-278-000-jobs-in-may-annual-pay-was-up-6-5-301839975.html
JOBLESS CLAIMS (Kitco)
“The initial weekly jobless claims rose by 2,000 to 232,000 in the week to Saturday, surprising the markets with a smaller-than-expected increase... he four-week moving average was at 1,797,500, a decrease of 1,500.” Story at...
https://www.kitco.com/news/2023-06-01/U-S-weekly-jobless-claims-rise-by-2-000-to-232-000-gold-price-ticks-up.html
ISM MANUFACTURING INDEX (ISM)
“The May Manufacturing PMI® registered 46.9 percent, 0.2 percentage point lower than the 47.1 percent recorded in April. Regarding the overall economy, this figure indicates a sixth month of contraction after a 30-month period of expansion... “Of the six biggest manufacturing industries, only one — Transportation Equipment — registered growth in May.” Report at...
https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/may/
GREEN ENERGY ISN’T GREEN NOR ENERGY (msn.com)
“You might expect the "green energy" movement to be the Number 1 supporter of clean, non-carbon nuclear and hydroelectric energy, but instead, it is the Number 1 opponent. "Green" groups have opposed nuclear for decades (leading to crippling costs) and worked to shut down hydroelectric dams...Despite claims that solar and wind are rapidly replacing fossil fuels, they provide less than 5% of world energy—only electricity, one-fifth of energy—and, crucially, even that small percentage depends on huge subsidies and reliable (mostly fossil-fueled) power plants...Consider the land use requirements of solar. The world uses over 165,000 TWh of energy per year, which requires ~19 billion kW of power on average. An optimistic, real-world power density for solar projects is 10 Watts per square meter. To power the world, you’d need ~1.8 million square kilometers of solar PV projects. If 1.8 million square kilometers of solar panels doesn’t seem like much, note that it is more than all cities, towns, villages, and human infrastructure combined (~1.5 million square kilometers).” Commentary at...
Don't be fooled, 'Green Energy' is neither green nor energy (msn.com)
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 rose about 1% to 4221.
-VIX fell about 13% to 15.65.
-The yield on the 10-year Treasury slipped to 3.597%.
PULLBACK DATA:
-Drop from Top: 12.9%. 25.4% max (on a closing basis).
-Trading Days since Top: 354-days.
The S&P 500 is 6.2% ABOVE its 200-dMA and 2.6% 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.
MSFT – Microsoft.
XLK – Technology ETF.
XLE – Energy Sector ETF. XLE tested its March low on 16 May on lower volume so I continue to hold it.
XLY - Consumer Discretionary ETF.
KRE – Regional Banking ETF. This is a very small position
for me. KRE tested the May 4 low of 36.08 on much lower volume 11 & 12
May.
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:
The number of issues on the NYSE making new 52-week-highs has been very weak since 2 February when the S&P 500 made an intermediate high at 4180. My indicator for this stat applies when the S&P 500 makes a new all-time high. The S&P 500 is a long way from its all-time high (4797). Still, the number of new highs is now very low and has remained that way for months. It is certainly a concern, but as always, one indicator is not enough to act on. Further, it would take an all-time new high on the S&P 500 before I can place a lot of confidence in the signal. Instead, this is a sign of the market we see now – it’s focused on a few Tech stocks rather than being a broad-based advance. We’ll need to see new-highs improve before we can feel confident in the ongoing rally. There were only 27 new-highs today. Greater than 100 would be ok, but not great. It remains wait and see.
The daily spread of 20 Indicators (Bulls minus Bears) declined
from -3 to -5 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations declined from -21 to -28.
(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: PRICE is positive; SENTIMENT, VIX & 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 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
THURSDAY 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.)
“Private sector employment increased by 278,000 jobs in May and annual pay was up 6.5 percent year-over-year, according to the May ADP® National Employment Report™ produced by the ADP Research Institute® in collaboration with the Stanford Digital Economy Lab ("Stanford Lab")...said Nela Richardson, chief economist, ADP. "Pay growth is slowing substantially, and wage-driven inflation may be less of a concern for the economy despite robust hiring." Report at..
https://www.prnewswire.com/news-releases/adp-national-employment-report-private-sector-employment-increased-by-278-000-jobs-in-may-annual-pay-was-up-6-5-301839975.html
“The initial weekly jobless claims rose by 2,000 to 232,000 in the week to Saturday, surprising the markets with a smaller-than-expected increase... he four-week moving average was at 1,797,500, a decrease of 1,500.” Story at...
https://www.kitco.com/news/2023-06-01/U-S-weekly-jobless-claims-rise-by-2-000-to-232-000-gold-price-ticks-up.html
“The May Manufacturing PMI® registered 46.9 percent, 0.2 percentage point lower than the 47.1 percent recorded in April. Regarding the overall economy, this figure indicates a sixth month of contraction after a 30-month period of expansion... “Of the six biggest manufacturing industries, only one — Transportation Equipment — registered growth in May.” Report at...
https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/may/
“You might expect the "green energy" movement to be the Number 1 supporter of clean, non-carbon nuclear and hydroelectric energy, but instead, it is the Number 1 opponent. "Green" groups have opposed nuclear for decades (leading to crippling costs) and worked to shut down hydroelectric dams...Despite claims that solar and wind are rapidly replacing fossil fuels, they provide less than 5% of world energy—only electricity, one-fifth of energy—and, crucially, even that small percentage depends on huge subsidies and reliable (mostly fossil-fueled) power plants...Consider the land use requirements of solar. The world uses over 165,000 TWh of energy per year, which requires ~19 billion kW of power on average. An optimistic, real-world power density for solar projects is 10 Watts per square meter. To power the world, you’d need ~1.8 million square kilometers of solar PV projects. If 1.8 million square kilometers of solar panels doesn’t seem like much, note that it is more than all cities, towns, villages, and human infrastructure combined (~1.5 million square kilometers).” Commentary at...
Don't be fooled, 'Green Energy' is neither green nor energy (msn.com)
-Thursday the S&P 500 rose about 1% to 4221.
-VIX fell about 13% to 15.65.
-The yield on the 10-year Treasury slipped to 3.597%.
-Drop from Top: 12.9%. 25.4% max (on a closing basis).
-Trading Days since Top: 354-days.
The S&P 500 is 6.2% ABOVE its 200-dMA and 2.6% 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.
XLK – Technology ETF.
XLE – Energy Sector ETF. XLE tested its March low on 16 May on lower volume so I continue to hold it.
XLY - Consumer Discretionary ETF.
The number of issues on the NYSE making new 52-week-highs has been very weak since 2 February when the S&P 500 made an intermediate high at 4180. My indicator for this stat applies when the S&P 500 makes a new all-time high. The S&P 500 is a long way from its all-time high (4797). Still, the number of new highs is now very low and has remained that way for months. It is certainly a concern, but as always, one indicator is not enough to act on. Further, it would take an all-time new high on the S&P 500 before I can place a lot of confidence in the signal. Instead, this is a sign of the market we see now – it’s focused on a few Tech stocks rather than being a broad-based advance. We’ll need to see new-highs improve before we can feel confident in the ongoing rally. There were only 27 new-highs today. Greater than 100 would be ok, but not great. It remains wait and see.
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
THURSDAY MARKET INTERNALS (NYSE DATA)
