Crude Inventories ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...
https://michaelramirez.substack.com/p/michael-ramirez-the-fiscal-folly?r=ntzh3&utm_campaign=post&utm_medium=web
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“Much of the social history of the Western world over the
past three decades has involved replacing what worked with what sounded good.”
- Thomas Sowell, senior fellow at the
Hoover Institution.
EIA CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 5.9 million barrels from the
previous week. At 445.6 million barrels, U.S. crude oil inventories are
slightly 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 dropped about 0.7% to 4468.
-VIX was little changed at 15.96. (Yesterday’s number was
15.99. I had a typo.)
-The yield on the 10-year Treasury slipped to 4.012
PULLBACK DATA:
-Drop from Top: 6.9%. 25.4% max (on a closing basis).
-Trading Days since Top: 401-days.
The S&P 500 is 8.7% 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:
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.
XLY - Consumer Discretionary ETF.
SHY – Short term bonds.
TODAY’S COMMENT:
The Bulls and Bears duked it out today, but the Bears won
as the S&P 500 returned to the lows in the afternoon. The Index is now about 0.9% above its 50-dMA.
That’s about where I thought this correction might make a low. Now, it doesn’t
look like it. The bottom will be signaled by a big down washout-day. If we do get one tomorrow that might trigger
Bollinger Bands to go oversold and I’d be tempted to put a little money back
into stocks.
Yesterday, 8 August, there was a Hindenburg Omen. Investopedia
says this: “The Hindenburg Omen is a technical
indicator that was designed to signal the increased probability
of a stock market
crash. It compares the percentage of new 52-week highs and new 52-week lows in
stock prices to a predetermined reference percentage that is supposed to
predict the increasing likelihood of a market crash...
In practice, the Hindenburg Omen is not always correct, but it may be used with
other forms of technical analysis to decide when it's time to sell.” From...
https://www.investopedia.com/terms/h/hindenburgomen.asp
While the Hindenburg Omen indicator is bearish, the
50-day Fosback Hi/Lo Logic indicator is bullish. It, too, is based on new-high and new-low
data, so go figure?
My opinion is not changed: This still looks like a normal
pullback to the lower trend line. I expect the pullback to continue. I always
remember, the indicators aren’t very good at calling short term moves.
The daily spread of 20 Indicators (Bulls minus Bears) improved
from -8 to -6 (a positive number is bullish; negatives are bearish); the 10-day
smoothed sum that smooths the daily fluctuations declined from -52 to -53.
(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 cautious Bull. The pullback
(underway) is needed to bring the markets back into balance. I’ll go back to an
over-invested position later, probably after the S&P 500 drops below the
50-dMA but before it get’s to the 100-dMA.
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 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 50% 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.
