“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“What the welfare system and other kinds of governmental
programs are doing is paying people to fail. Insofar as they fail, they receive
the money; insofar as they succeed, even to a moderate extent, the money is
taken away.” - Thomas Sowell, senior fellow at
the Hoover Institution.
“The current push by government to get people to buy
electric vehicles reminds me of the story about a huge pet food company that
developed a new type of dog food. They spent millions on developing and
marketing, but the campaign fell flat and the product sat on the shelves. They
brought in all of their top salespeople to find the problem. At the meeting, a
small voice from the back spoke up and said: “The dogs don’t like it.” - Doug Helland, WSJ Letters (31 Aug 2023).
“States are scrambling to find ways to keep child-care
centers afloat after billions in Covid-relief funding run out next month...”
WSJ at... https://www.wsj.com/us-news/education/as-pandemic-funds-expire-child-care-centers-struggle-to-survive-6cefdf5b
My comment: Our Government continues to give away money
for a crisis that ended a year ago.
JOBLESS CLAIMS (ABC News)
“U.S. applications for unemployment benefits fell
slightly last week...The number of Americans applying for jobless benefits last
fell week by 4,000, to 228,000 the week ending August 26...” Story at...
https://abcnews.go.com/Business/wireStory/us-applications-jobless-claims-inch-back-companies-hold-102831184
PERSONAL SPENDING (USA Today)
“Consumers boosted their spending rapidly in July and
price pressures remained modest, signs of continued U.S. economic strength amid
rising interest rates... Household
spending, the primary driver of economic growth, rose a robust 0.8%
in July...” Story at...
https://www.wsj.com/economy/consumer-spending-personal-income-inflation-july-2023-f9ca1e14
PCE PRICES
“An inflation measure that’s watched closely by the
Federal Reserve edged higher in July...Consumer prices increased 3.3% from a
year earlier, above the 3% pace in June but below the 40-year high of 7% in
June 2022...” Story at...
https://www.usatoday.com/story/money/2023/08/31/july-pce-inflation-report-today/70723559007/
CHICAGO PMI (invezz.com)
“The indicator zoomed to 48.7, well above market
expectations and the previous month’s reading of 42.8, but continued to remain
in contractionary territory.” Story at...
https://invezz.com/news/2023/08/31/chicago-pmi-surprises-to-the-upside-philadelphia-fed-gdpplus-indicates-q422-recession/
NICE BOUNCE BUT NOT CONVINCING (Heritage Capital)
“If my thesis regarding the pullback remains correct, the
rally should end sooner than later... Interestingly, the bounce has not only
not turned our indicators and models more positive, it has done the exact
opposite. Our most aggressive models continue to lighten up and reduce
exposure. We will see if that is just a one or two day thing or something more
meaningful.” – Paul Schatz, President Heritage Capital.
My cmt: Paul and I are usually in agreement, so I’m a
little concerned about his comment posted Wednesday.
PULLBACK DATA:
-Drop from Top: 5.9%. 25.4% max (on a closing basis).
-Trading Days since Top: 417-days.
The S&P 500 is 8.4% ABOVE its 200-dMA and 0.9%
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:
XLK – Technology ETF (holding since the October lows).
SPY – I bought a large position in the S&P 500
Friday, 8/14, in my 401k (it has limited choices).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday, 8/21.)
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.
TODAY’S COMMENT:
After 4 positive days in a row, the markets were due for
a down day. Breaking with the trend, VIX fell. The options players were not
concerned with today’s selloff.
I was surprised to see that Rydex investors have gotten
very bearish in a hurry, thus driving Sentiment down to near a Buy signal. Sentiment
has been a pretty good signal recently, so this is another sign that we may
have seen the end of the recent weakness that led to a 5% pullback.
The daily spread of 20 Indicators (Bulls minus Bears) declined
from +14 to +11 (a positive number is bullish; negatives are bearish); the
10-day smoothed sum that smooths the daily fluctuations improved from -17
to +1. (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 & VOLUME are Bullish; VIX & SENTIMENT are neutral. SENTIMENT
is nearly giving a bullish signal because Rydex investors turned very bullish.
(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 21 December, 9 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I am Bullish. Indicators continue to improve.
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 BUY. (My basket of Market
Internals is 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 70% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks. I’m “over invested” now expecting new,
all-time highs this year.
I trade about 15-20% of the
total portfolio using the momentum-based analysis I provide here. When I see a
definitive bottom, I add a lot more stocks to the portfolio using an S&P
500 ETF as I did back in October.
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“One of the painful signs of years of dumbed-down
education is how many people are unable to make a coherent argument. They can
vent their emotions, question other people’s motives, make bold assertions,
repeat slogans—anything except reason.” - Thomas
Sowell, senior fellow at the Hoover Institution.
“This has nothing to do with whether you thought Trump
was a good or bad president...I am as certain as I am writing this that Donald
Trump will never again be elected president of these United States... The
greatest peril for the country is four (more) years of Democrats in power. The
difference this time ’round is that Trump’s nomination would guarantee that
this peril becomes our reality " - Andy McCarthy, columnist, National
Review (a conservative publication).
“Gross Domestic Product (GDP). GDP is
simply the total amount of spending in an economy. GDP, as currently measured,
does not distinguish between “good” spending and “bad” spending. GDP does not
distinguish between consumption spending and investment spending. GDP also does
not distinguish whether spending is generated by existing wealth, by going into
debt temporarily, or by going into debt permanently. In this world, every dollar
spent on education or new means of production, is counted the same as every
dollar spent on epic bachelor parties and video games.” – Michael Lebowitz,
Real Investment Advice
GDP – 2ND ESTIMATE (CNBC)
“U.S. economic growth was revised lower to a still-solid
pace in the second quarter...Gross domestic product increased at a 2.1%
annualized rate last quarter...That was revised down from the 2.4% pace
reported last month.” Story at...
https://www.cnbc.com/2023/08/30/us-second-quarter-gdp-growth-revised-lower.html
ADP EMPLOYMENT (ADP via prnewswire)
“Private sector employment increased by 177,000 jobs in
August and annual pay was up 5.9 percent year-over-year, according to the
August ADP® National
Employment Report produced by the ADP Research Institute®...”
Story at...
https://www.prnewswire.com/news-releases/adp-national-employment-report-private-sector-employment-increased-by-177-000-jobs-in-august-annual-pay-was-up-5-9-301913687.html
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) decreased by 10.6 million barrels from the
previous week. At 422.9 million barrels, U.S. crude oil inventories are about
3% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 0.4% to 4515.
-VIX slipped about 4% to 13.88.
-The yield on the 10-year Treasury slipped to 4.113%.
PULLBACK DATA:
-Drop from Top: 5.9%. 25.4% max (on a closing basis).
-Trading Days since Top: 416-days.
The S&P 500 is 8.7% ABOVE its 200-dMA and 1.1%
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:
XLK – Technology ETF (holding since the October lows).
SPY – I bought a large position in the S&P 500
Friday, 8/14, in my 401k (it has limited choices).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday, 8/21.)
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.
TODAY’S COMMENT:
Wednesday, unchanged volume was very high. As I’ve often
said, many believe that this indicator suggests investor confusion at market
turning points. Indications are improving, so if this is a turning point, I’d
have to assume it is confirmation of the correction-over signs we’ve seen for
the recent, small 5% pullback. That’s my guess; “high-unchanged-volume” is not one
of my indicators because it is often wrong, and like today, sometimes hard to
interpret.
Utilities were sold today. That’s a bullish-sign for the
day. Longer term, my "Utilities vs. the
S&P 500" indicator is also bullish.
The daily spread of 20 Indicators (Bulls minus Bears) improved
from +8 to +14 (a positive number is bullish; negatives are bearish); the
10-day smoothed sum that smooths the daily fluctuations improved from -37
to -17. (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 Bullish; VIX, VOLUME & SENTIMENT 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 21 December, 9 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I am Bullish. Indicators continue to improve.
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
TUESDAY WEDNESDAY MARKET INTERNALS (NYSE
DATA)
My basket of Market Internals improved to BUY. (My basket of Market
Internals is 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 70% 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. When I see a
definitive bottom, I add a lot more stocks to the portfolio using an S&P
500 ETF as I did back in October.
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“Congratulations, of a perverse sort, to President Biden
and his Congressional comrades. The latest budget figures show that they are
breaking peacetime, non-crisis records for spending and deficits. And there’s
no respite in sight... What’s astounding is that this Beltway blowout is
happening when the economy is growing, the Covid crisis is past, and there are
no domestic emergencies to address. This is when deficits are supposed to
decline, as they did during the economic expansions of the 1980s, 1990s and
2000s... The next time the U.S. Treasury lectures the Greeks or Italians about
their fiscal woes, the southern Europeans should laugh out loud.” - WSJ
Opinion.
“ ...in America, the rule of law still matters. And
that’s why Donald Trump has been charged with 91 felonies in four separate
cases for attempting to steal an election, falsifying business records and
mishandling classified information. We’ve seen what happens when people start
believing nothing matters. That’s why it doesn’t matter that Donald Trump was
president of the United States. It doesn’t matter that he is currently running
for the presidency. This is America. No one is above the law. That’s why it
matters that Donald Trump faces consequences for his actions.” - The Republican
(my emphasis) Accountability Project.
CONSUMER CONFIDENCE (Conference Board)
"Consumer confidence fell in August 2023, erasing back-to-back increases in June and
July," said Dana Peterson, Chief
Economist at The Conference Board. "August's disappointing headline
number reflected dips in both the current conditions and expectations indexes.
Write-in responses showed that consumers were once again preoccupied with
rising prices in general, and for groceries and gasoline in particular.” Press
release at...
https://www.prnewswire.com/news-releases/us-consumer-confidence-pulled-back-in-august-301912549.html
JOLTS JOB OPENINGS (CNBC)
"Employment openings totaled 9.58 million for the month,
edging lower from the downwardly revised 9.62 million in May, the Labor
Department said in its monthly Job Openings
and Labor Turnover Survey... “This is definitely heading in the
Goldilocks direction,” said Rachel Sederberg, senior economist at labor
analytics firm Lightcast." Story at...
https://www.cnbc.com/2023/08/01/jolts-june-2023-job-openings-layoffs-both-declined-in-a-positive-sign-for-the-labor-market.html
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 1.5% to 4498.
-VIX slipped about 4% to 14.45.
-The yield on the 10-year Treasury slipped to 4.116%.
PULLBACK DATA:
-Drop from Top: 6.2%. 25.4% max (on a closing basis).
-Trading Days since Top: 415-days.
The S&P 500 is 8.3% ABOVE its 200-dMA and 0.8%
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:
XLK – Technology ETF (holding since the October lows).
SPY – I bought a large position in the S&P 500
Friday, 8/14, in my 401k (it has limited choices).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday, 8/21.)
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.
(Added 8/24. So far, so good.)
TODAY’S COMMENT:
We had been seeing improvements in breadth and
new-high/new-low data. Today there was
another 80%+ up-volume day. That makes
back-to-back, high-volume days and that’s a rare bullish sign. MACD switched to
bullish today and so did the McClellan Oscillator. With the Oscillator now
bullish, that cancels the prior Hindenburg Omen. (The Hindenburg doesn’t always
crash when we are looking at the stock market.) The S&P 500 climbed above
its 50-dMA. Indicators are telling us “pullback over!”
Tuesday 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, so we may get a chance to add more to the stock portfolio at a
discount price.
The daily spread of 20 Indicators (Bulls minus Bears) improved
from -2 to +7 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations improved from -54 to -38.
(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 Bullish; VIX, VOLUME & SENTIMENT 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 21 December, 9 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I am Bullish. Indicators continue to improve.
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
TUESDAY MARKET INTERNALS (NYSE
DATA)
My basket of Market Internals improved to BUY. (My basket of Market
Internals is 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 70% 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 as I did back in October.
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
PRESIDENTIAL PORTRAIT
Inmate No. P01135809, Fulton County Sheriff’s Office.
“For those who revile Trump for his autocratic instincts,
demagoguery, vulgarity and self-obsession, the mug shot may offer feelings of
vindication. For the millions of Trump supporters who believe he is a victim of
persecution, it will enshrine his status as a living political martyr on which
his bid to regain the White House is rooted. While Trump’s team said he wanted
to look defiant, the ex-president’s booking photo is likely to polarize
Americans as much as his politics.” - Stephen
Collinson, CNN
My cmt: As a former Trump voter, I don’t revile Trump for
his “autocratic instincts, demagoguery, vulgarity and self-obsession.” I despise
him for leading a seditious conspiracy to overturn an election that he clearly
lost. (It will be interesting to see if prosecutors can prove that in court.)
SHOCKING CANDOR ON FUEL STANDARDS (WSJ)
“For decades, bureaucrats in Washington have argued that
fuel-economy mandates pay for themselves... But unlike in previous rulemakings,
the costs are now so comically high that regulators can no longer pretend that
mandating greater fuel economy for passenger cars is good for society... But
the proposed rule says this White House’s not-so-secret password: climate
change. What about it? Without a hint of sarcasm, page 5-39 of the department’s
accompanying environmental assessment estimates that in 2060 the
proposal would reduce average global temperatures by 0.000%... Chinese
Communist Party officials must be reading our wonderful environmental
assessments for comic relief as they ramp up coal production.” - Michael
Buschbacher, partner at
the law firm Boyden Gray PLLC and served in the Justice Department’s
Environment Division (2020-21), and James Conde, counsel at Boyden Gray PLLC.
Commentary at...
https://www.wsj.com/articles/transportation-department-fuel-standards-car-ev-electric-vehicle-auto-industry-climate-change-388d6dd0
If you would like to read and comment on this proposed
rule, go to...
https://www.regulations.gov/document/NHTSA-2023-0022-0004
The comments I read were all form letters from
Environmental Whackos who stated that “We urge NHTSA to finalize the strongest
rule possible...” Your comments are very important to counter such
mindless, partisan opinion.
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.6% to 4431.
-VIX slipped about 4% to 15.08.
-The yield on the 10-year Treasury slipped to 4.205%.
PULLBACK DATA:
-Drop from Top: 7.6%. 25.4% max (on a closing basis).
-Trading Days since Top: 414-days.
The S&P 500 is 6.9% ABOVE its 200-dMA and 0.6%
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
and we called a buy on 4 October 2022.
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October lows).
SPY – I bought a large position in the S&P 500
Friday, 8/14, in my 401k (it has limited choices).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday, 8/21.)
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.
(Added 8/24. So far, so good.)
TODAY’S COMMENT:
Breadth continues to improve and today, new-52-week-highs
outpaced new-lows for the first time in 2 weeks. These are good signs
suggesting the recent weakness is in the process of ending. We got a Bottom
Signal 17 August when Bollinger Bands, RSI and the 50-dEMA of Fosback’s High
Low Logic indicator all were suggesting a bottom. So far, that looks like a
very good call since it was at the recent bottom. Today, the Short-term
New-high/new-low data gave a buy signal. While indicators are improving, making
short-term calls can be problematic so there is no gurantee guarantee that we have seen
an end to this pullback. Still, I am
betting that the pullback has seen its bottom.
I’ll feel somewhat better when the S&P 500 breaks back above its
50-dMA (now resistance).
The daily spread of 20 Indicators (Bulls minus Bears) improved
from -7 to -2 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations improved from -58 to -54.
(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, VIX, VOLUME & SENTIMENT 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 21 December, 9 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I am becoming more Bullish as indicators
improve
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
MONDAY MARKET INTERNALS (NYSE
DATA)
My basket of Market Internals improved to HOLD. (My basket of Market
Internals is 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 70% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks. I'll re-evaluate when the S&P 500 makes a new all-time high.
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 as I did back in October.
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
FED CHAIR POWELL JACKSON HOLE SPEECH (AP News)
“The continued strength of the U.S. economy could require
further interest rate increases, Federal Reserve Chair Jerome Powell said
Friday in a closely watched speech that also highlighted the uncertain nature
of the economic outlook.
Powell noted that the economy has been growing faster than expected and that
consumers have kept spending briskly — trends that could keep inflation
pressures high. He reiterated the Fed’s determination to keep its benchmark
rate elevated until inflation is reduced to its 2% target.” Story at...
https://apnews.com/article/inflation-federal-reserve-rates-economy-jackson-hole-9a720711618c0cfd851b51b0786af4f0
M2 CONTINUES TO FALL MAKING STOCKS OVERVALUED (McClellan
Financial Publications)
“What we face now is a situation wherein money supply is
shrinking, but stock prices were still rising as of July. And... that
combination has been pushing up the ratio of the SP500 Index level to M2.
This is a very high level historically speaking. It did go higher in the
late 1990s thanks to the Internet bubble, with predictably painful effects
afterward. All of the other instances of this ratio being up this high
have also led (eventually) to bear markets.” Commentary at...
https://www.mcoscillator.com/learning_center/weekly_chart/m2_continues_to_fall_making_stocks_overvalued/
My cmt: Valuation not a good timing indicator for
stocks. Valuations can always go higher.
Now, we have more investors (a new generation is now investing) chasing fewer
stocks. One would expect higher valuations; but I still think we are in a 1998
analogue. A big Bear Market is probably a couple of years away.
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose about 0.7% to 4405.71.
-VIX slipped about 10% to 15.47.
-The yield on the 10-year Treasury slipped to 4.224
PULLBACK DATA:
-Drop from Top: 8.1%. 25.4% max (on a closing basis).
-Trading Days since Top: 413-days.
The S&P 500 is 6.3% ABOVE its 200-dMA and 1.2%
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
and we called a buy on 4 October 2022.
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October lows).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday, 8/21.)
SPY – I bought the S&P 500 Friday, 8/14, in my 401k
(it has limited choices).
XLE – Added Tuesday, 8/22.
SSO – 2x S&P 500 ETF.
(Added 8/24. I’ll sell this in a hurry if the Index falls.)
TODAY’S COMMENT:
I must have been asleep when I wrote yesterday’s
blog. There was no Fed meeting today, as
a few readers wrote to correct me. The “Fed Speak” issue was Chairman Powell’s
Jackson Hole speech today. Last year the
speech was a shocker; this year there was mostly nothing new. But Powel did
suggest more hikes might be needed. This time, the markets were up after the speech.
I expect the markets to retake prior highs sooner or
later. If the stock market weakness is over, (as I think it is) it will be
sooner. That’s why I have been buying recently. From day one, I have suggested
a big retreat was not in the cards and a retreat short the 50-dMA was the most
likely scenario. It went a little deeper than I expected, but it was close.
Still, short-term calls are mostly dumb luck. If the weakness is over, I’ll chalk it up to
luck or just being dumb
The 10-dMA of Breadth is improving slowly. The 50-dMA of Breadth never did signal a correction; those are two reasons I am bullish.
We look at a summary of indicators on Friday: The weekly
rundown of indicators were a little changed – fewer Bull signs & fewer Bear
signs (now 13-bear and 7-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
-There was a Follow Thru Day 23 Aug
-The 50-dMA percentage of issues advancing on the NYSE
(Breadth) is above 50%.
-The 100-dMA percentage of issues advancing on
the NYSE (Breadth) is above 50%.
-The long-term, 50-dEMA, Fosback Hi-Low Logic Index.
-XLI-ETF (Cyclical Industrials) is slightly outperforming
the S&P 500 – call it bullish.
-There have been 7 up-days over the last 20 sessions - bullish.
-The Smart Money (late-day action).
NEUTRAL
-10 August there was a Bullish Outside Reversal Day.
Expired
-There have been 3 Statistically-Significant days (big
moves in price-volume) in the last 15-days.
-My Money Trend indicator is flat.
-RSI.
-Sentiment.
-Bollinger Band Squeeze 28 April - expired.
-Bollinger Bands.
-The S&P 500 is 6.3% above its 200-dMA. (Bear indicator
is 12% above the 200-day.)
-Overbought/Oversold Index (Advance/Decline Ratio).
-MACD of the percentage of issues advancing on the NYSE
(breadth) made a bearish crossover 3 August, however, it is improving rapidly –
call it Nuetral.
-Issues advancing on the NYSE (Breadth) compared to the
S&P 500.
-The 50-dMA percentage of issues advancing on the NYSE
(Breadth) has not been below 50%, for more than 3 days in a row.
-There was a Zweig Breadth Thrust 31 March. That’s a
rare, very-bullish sign, but the McClellan Oscillator subsequently turned
negative, so this indicator has expired.
-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.
-VIX indicator.
-MACD of S&P 500 price made a bearish crossover 27
July, but is improving rapidly.
-On average, the size of up-moves has been smaller than
the size of down-moves over the last month, but not enough to send a signal.
-The Calm-before-the-Storm/Panic Indicator flashed a top
warning signal 31 July & 1 August. That looks like it was the short-term
top.
-There was a 90% down-volume day 9 March.
-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.
BEAR SIGNS
-The smoothed advancing volume on the NYSE is falling.
-There was a Hindenburg Omen signal 6 Aug 2023. This
remains in effect until the McClellan Oscillator turns positive.
-The 10-dMA percentage of issues advancing on
the NYSE (Breadth) is below 50%.
-Smoothed Buying Pressure minus Selling Pressure is falling.
-Long-term new-high/new-low data.
-Short-term new-high/new-low data.
-McClellan Oscillator.
-Slope of the 40-dMA of New-highs is falling.
-The graph of the 100-day Count (the 100-day sum of
up-days).
-The 5-10-20 Timer System is SELL.
-The 5-day EMA is below the 10-day EMA, so short-term
momentum is bearish.
-39% of the 15-ETFs that I track have been up over the
last 10-days. (45-55% is neutral.)
-S&P 500 spread vs. Utilities (XLU-ETF) shows the
Index outpacing Utilities, but the trend has been down.
On Monday’s update of the Friday summary of indicators (20
December 2021), 9 days before the top of the current 25% correction, there were
21 bear-signs and zero bull-signs. Now there are 13 bear-signs and 7-Bull.
Last week, there were 16 bear-sign and 8 bull-signs.
The daily spread of 20 Indicators (Bulls minus Bears) improved
from -9 to -7 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations declined from -57 to -58.
(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, VIX, VOLUME & SENTIMENT 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 21 December, 9 sessions before the high of this
recent bear market, based on the bearish “Friday Rundown” of indicators.)
Bottom line: I remain a “concerned” Bull. (I guess I can’t
be “cautious” if I am more than fully invested. Caution to the wind! Hope I
haven’t gotten too greedy.)
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 remained SELL. (My basket of Market
Internals is 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 70% 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 as I did back in October.
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
TEAM OBAMA’S THIRD TERM IN THE WHITE HOUSE HAS BEEN A
DISASTER AND AN INSULT TO BRITAIN (The Telegraph – a British Newspaper,
est.1855)
“It is no coincidence that both Joe Biden and Barack
Obama began their presidencies by unceremoniously throwing the same bust of
Winston Churchill out of the Oval Office...both Obama and Biden advanced
presidencies that have been the antithesis of practically everything Churchill
stood for as Britain’s great wartime saviour. They are two of the weakest
leaders in American history, who have done more to promote America’s decline
than any president in the modern era, including Jimmy Carter. They clearly
could not stand the sight of Churchill watching over them, as they did all they
could to tear apart the US/UK Special Relationship and drag down the world’s
superpower.” Story at...
Team
Obama’s third term in the White House has been a disaster and an insult to
Britain (msn.com)
JOBLESS CLAIMS (Yahoo Finance)
“Initial claims for state unemployment benefits decreased
by 10,000 to a seasonally adjusted 230,000 for the week ended Aug. 19...” Story
at...
https://finance.yahoo.com/news/us-jobless-claims-fall-labor-123816711.html
DURABLE ORDERS (rttnews)
“With aircraft demand pulling back sharply following
recent strength, the Commerce Department released a report on Thursday showing
new orders for U.S. manufactured durable goods tumbled by more than expected in
the month of July. The Commerce Department said durable goods orders plunged by
5.2 percent in July after surging by a revised 4.4 percent in June.” Story
at...
https://www.rttnews.com/3386219/u-s-durable-goods-orders-plunge-5-2-in-july-amid-sharp-pullback-in-aircraft-demand.aspx
My cmt: If you ignore Boeing, Durable Orders were up.
MARKET REPORT / ANALYSIS
-Thursday the S&P 500 fell about 1.4% to 4376.
-VIX slipped about 8% to 17.20.
-The yield on the 10-year Treasury rose to 4.241
PULLBACK DATA:
-Drop from Top: 8.8%. 25.4% max (on a closing basis).
-Trading Days since Top: 412-days.
The S&P 500 is 5.7% ABOVE its 200-dMA and 1.9%
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
and we called a buy on 4 October 2022.
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October lows).
XLY - Consumer Discretionary ETF. (Holding since the
October lows - I bought more XLY Monday.)
SPY – I bought the S&P 500 Friday in my 401k (it has
limited choices).
XLE – Added Tuesday.
SSO – 2x S&P 500 ETF.
(I’ll sell this in a hurry if the Index falls.)
TODAY’S COMMENT:
I added SSO (2x S&P 500 ETF) as a trade today. If I
had been a little more patient, I might have waited until the end of the day. Today
was an ugly day. The S&P 500 peaked
around 11 am and fell the rest of the day to finish below Thursday’s close. Not very encouraging.
Many of the parameters that I follow, such as volume,
breadth, charts, etc., are either oversold or close, suggesting that markets
may be due for a bounce. Unfortunately, that doesn’t mean the index can’t fall
further. On a positive note, Thursday was a statistically significant down-day.
That just means that the price-volume move exceeded my statistical parameters.
Statistics show that a statistically-significant, down-day is followed by an up-day
about 60% of the time.
While the pundits guessed about the cause of today’s
swoon, it may be as simple as worry over the ongoing Fed meeting. We’ll find
out tomorrow when the Fed meeting concludes and Chairman Powell gives his press
conference. 2 pm is the witching hour.
The daily spread of 20 Indicators (Bulls minus Bears) declined
from -4 to -9 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations declined 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: PRICE is bullish; VIX is bearish; VOLUME & SENTIMENT are
neutral. There are still a lot of oversold signs suggesting markets may be in
the vicinity of an oversold bottom.
(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 21 December, 9 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
THURSDAY MARKET INTERNALS
(NYSE DATA)
My basket of Market Internals declined to SELL. (My basket of Market
Internals is 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 70% 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 as I did back in October.
My basket of Market Internals remained BUY. (My basket of Market
Internals is 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.) 
