Consumer Confidence ... Home Sales ... Crude Oil Inventories ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“If the Arabs put down their weapons today, there would
be no more violence. If the Jews put down their weapons today, there would be
no more Israel.” - Golda Meir, a founder of the State of Israel (1948) and
later its fourth prime minister (1969–74).
“Many of us have been exasperated by the antics of Just
Stop Oil protesters. Now, I believe that these are well-meaning and committed
to their cause and I am sure that they think that they are trying to save the planet in the
best way they can think of – gain publicity, get people talking and influence
politicians. But what would happen if we literally just stopped oil tomorrow
and did without the natural resources on which the world, its economies and
populations depend? The answer: most likely six billion people would die within
a year.” - Neil Record. Story at...
What
could happen if we just stopped oil? Six billion might die (msn.com)
EXPERT HIRED BY TRUMP SAYS THERE WAS NO FRAUD (msn.com)
“During Block's recent appearance on CNN's 'OutFront',
host Erin Burnett asked, ‘You were hired by team Trump to investigate voter
fraud...Did you find the widespread fraud they wanted you to find?’
‘No. In my job looking for voter fraud for the campaign,
we didn't find any– we didn't find enough fraud to have impacted the result of
any election in any of the swing states that we took a look at.’" Story
at...
'Can't
wait until he repeats this in court': Trump mocked as expert hired by ex-POTUS
to prove voter fraud says he found all claims to be false (msn.com)
CONSUMER CONFIDENCE (Conference Board)
“The Conference Board Consumer Confidence Index® increased
in December to 110.7...“December’s increase in consumer confidence reflected
more positive ratings of current business conditions and job availability, as
well as less pessimistic views of business, labor market, and personal income
prospects over the next six months,” said Dana Peterson, Chief Economist at The Conference
Board. “While December’s renewed optimism was seen across
all ages and household income levels, the gains were largest among householders
aged 35-54 and households with income levels of $125,000 and above. December’s
write-in responses revealed the top issue affecting consumers remains rising
prices...” Press release at...
https://www.conference-board.org/topics/consumer-confidence
EXISTING HOME SALES (YahooFinance)
“Homebuying activity picked up slightly in November, but
the housing market is still pretty much stalled as home prices continue to
climb higher. Total existing home sales inched up 0.8% in
November...” Sory at...
https://finance.yahoo.com/news/existing-home-sales-rise-slightly-in-november-as-mortgage-rates-fall-162911578.html
CRUDE OIL INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those
in the Strategic Petroleum Reserve) increased by 2.9 million barrels from the
previous week. At 443.7 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
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 fell about 1.5% to 4698.
-VIX rose about 9% to 13.69.
-The yield on the 10-year Treasury dipped to 3.855%.
PULLBACK DATA:
-Drop from Top: 2%. 25.4% max (on a closing basis).
-Trading Days since All-Time Top: 494-days. (The top was
3 January 2022.)
The S&P 500 is 8.6% ABOVE its 200-dMA and 5.5% ABOVE
its 50-dMA.
*I won’t call the correction over until the S&P 500
makes a new-high; however, evidence suggests the major bear-market bottom of
the 25% decline was in the 3600 area and we called a buy on 4 October 2022.
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October 2022
lows).
XLY - Consumer Discretionary ETF. (Holding since the
October 2022 lows - I bought more XLY 8/21/23.)
INTC – Added 12/6/2023.
BA – Added 12/6/2023.
DWCPF - Dow Jones U.S. Completion Total Stock Market
Index. – Added 12/7/2023. This is a large position in my retirement account
betting on Small Caps.
TODAY’S COMMENT:
We’ve been expecting a pullback
of some kind for a couple of days. We
got it today. It may be just a start of
a bigger move, or not. Regardless, I don’t expect much more than a 3%-5% retreat
– just a typical short-term dip.
Today, 90% of the volume
on the NYSE was down-volume. The S&P 500 also closed near its low so it is
a concern. This indicator was developed by Lowry Research. They stated: “A
single, isolated 90% Downside Day does not, by itself, have any long term trend
implications, since they often occur at the end of short term corrections. But,
because they show that investors are in a mood to panic, even an isolated 90%
Downside Day should be viewed as an important warning that more could follow.”
– Lowry Research.
It was also a Bearish Outside Reversal Day. According to
Investopedia: “This demonstrates that the bulls had control over the market
before the bears took the reins in a meaningful way, signaling a shift in the
overall trend.”
Perhaps, but like all indicators, it is not always correct,
so unless we see other indicators confirming the bearishness I won’t take any
action.
Wednesday 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.
Tops almost always occur on Statistically-significant,
up-days, so this indicator is not warning of a significant top.
Both RSI and Bollinger Bands cleared their overbought indications,
but the S&P 500 remains too far ahead of breadth (number of issues advancing)
on the NYSE.
While there were some bearish signs today, the Summary of
Indicators (Friday Rundown indicators) was 23-bulls and 4-bears so today’s big
down-day doesn’t appear (at this point) to be particularly concerning.
I predicted months ago
that the S&P 500 would make a new high this year. The Index is close, 2% to go. Come-on markets,
don’t fail me now.
The daily spread of 20 Indicators (Bulls minus Bears) declined
from +11 to +10 (a positive number is bullish; negatives are bearish-14 is a
very high number); the 10-day smoothed sum that smooths the daily fluctuations improved
from +85 to +89. (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, VOLUME & VIX are bullish; SENTIMENT is neutral. (One
warning: The Long Term Indicator is not a good top indicator.)
(The important major BUY in this indicator was on 21
October 2022, 7-days after the bear-market 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 bullish.
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 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 65% 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. That burns all the cash. I have about 25% of the portfolio in bonds.
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.
CHRISTMAS QUIZ: Ans. “I saw three ships come
sailing in, on Christmas day on Christmas day. I saw three ships come sailing
in, on Christmas Day in the morning.”
