PPI ... Core PPI ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

The NYSE is closed Monday for the Martin Luther King holiday. 

“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire.
 
CHEVRON DEFFERENCE WAS FUN WHILE IT LASTED (WSJ)
“Chevron v. NRDC (1984), [is] the Supreme Court decision... [that] instructs judges to defer to certain agency interpretations of statutes they administer, which the justices will reconsider next week...Once heralded as a way to use agency expertise to bring clarity and consistency to the law, the doctrine often is experienced by the public today as a series of sharp vacillations in the law, as one administration succeeds another. Presidents turn increasingly to the administrative state to implement priorities they can’t enact through Congress. Each administration improves on its predecessor’s playbook, becoming swifter and more adept at identifying legal positions it wants to change and issuing rules and decisions to do so.” Opinion at...
https://www.wsj.com/articles/chevron-deference-was-fun-while-it-lasted-legal-scotus-partisan-regulation-changes-bddbfe27
My cmt: The current system supports rulemaking that Congress never intended. I think the current Court will overturn Chevron. We will see.
 
PPI / CORE PPI (CNBC)
“Wholesale prices unexpectedly declined in December, providing a positive signal for inflation, the Labor Department reported Friday.
The producer price index fell 0.1% for the month and ended 2023 up 1% from a year ago... Excluding food and energy, core PPI was flat against the estimate for a 0.2% increase.” Story at... 
https://www.cnbc.com/2024/01/12/wholesale-prices-unexpectedly-fell-0point1percent-in-december-in-positive-inflation-sign.html
 
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose about 0.1% to 4784.
-VIX rose about 2% to 12.70.
-The yield on the 10-year Treasury slipped to 3.945
 
PULLBACK DATA:
-Drop from Top: 0.3%. 25.4% max (on a closing basis).
-Trading Days since All-Time Top: 509-days. (The top was 3 January 2022.)
The S&P 500 is 9% ABOVE its 200-dMA and 4% ABOVE its 50-dMA.
*I won’t call the correction over until the S&P 500 makes a new all-time-high; however, 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 look at a summary of indicators on Friday. (These indicators tend to be both long-term and short-term, so they are different than the 20 that I report on daily.) The weekly rundown of indicators have turned Bearish this week: now 7-bear and 13-bull.
 
BULL SIGNS
-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%
-Smoothed Buying Pressure minus Selling Pressure.
-The graph of the 100-day Count (the 100-day sum of up-days).
-There was a high up-volume day on 21 December canceling the High down-volume day on 20 December. In addition, there were back-to-back, high up-volume days (80%+) on the NYSE 13 & 14 Dec.
-The 5-10-20 Timer System is BUY.
-The short-term momentum is bullish.
 
NEUTRAL
-There have been 4 Distribution Days since the last Follow-thru Day.
 -There has been 1 Statistically-Significant days (big moves in price-volume) in the last 15-days.
-Sentiment.
-Bollinger Bands.
-Overbought/Oversold Index (Advance/Decline Ratio).
-The 50-dMA percentage of issues advancing on the NYSE (Breadth) has not been below 50%, for more than 3 days in a row.
-The S&P 500 is 9% above its 200-dMA. (Bear indicator is 12% above the 200-day.)
-The short-term, 10-day EMA, Fosback Hi-Low Logic Index.
-The long-term, 50-dEMA, Fosback Hi-Low Logic Index.
-There have been 12 up-days over the last 20 sessions.
-There have been 4 up-days over the last 10 sessions.
-RSI.
-The Smart Money (late-day action).
-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 15 Sept., but it may well have been a bottom signal. - Expired
-VIX indicator.
-S&P 500 spread vs. Utilities (XLU-ETF).
-There was a New-high/New-low spread reversal on 4 October (based on std deviation of spread). - Expired
-There were Hindenburg Omen signals 11 & 12 Sept 2023 – expired. The McClellan Oscillator turned positive.
-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.
-20 December there was a Bearish Outside Reversal Day, but the S&P 500 closed above the high for 20 December, 4778, on 27 & 28 December so this one is now neutral.
-There was a Zweig Breadth Thrust 3 November. That’s a rare, very-bullish sign, but the McClellan Oscillator turned negative.
 
BEAR SIGNS
-The smoothed advancing volume on the NYSE is falling.
- Today, there is a Bollinger Squeeze. A squeeze precedes a big breakout either up or down. Bollinger Bands are now very close to “overbought” so it looks like the break out is most likely to be down.
-The 10-dMA percentage of issues advancing on the NYSE (Breadth) is below 50%.
-MACD of the percentage of issues advancing on the NYSE (breadth) made a bearish crossover 12 January.
-Issues advancing on the NYSE (Breadth) compared to the S&P 500.
-MACD of S&P 500 price made a bearish crossover 29 Dec.
-My Money Trend indicator.
-Long-term new-high/new-low data.
-Short-term new-high/new-low data.
-Slope of the 40-dMA of New-highs is falling.
-McClellan Oscillator.
-XLI-ETF (Cyclical Industrials) vs the S&P 500.
-41% of the 15-ETFs that I track have been up over the last 10-days. (45-55% is neutral.)
 
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 7 bear-signs and 13-Bull. Last week, there were 10 bear-sign and 10 bull-signs.
 
The daily spread of 20 Indicators (Bulls minus Bears) declined from -6 to -8 (a positive number is bullish; negatives are bearish); the 10-day smoothed sum that smooths the daily fluctuations declined from -18 to -29. (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.
 
(One warning: The Long-Term Indicator is not a good top-indicator. It can signal BUY at a top.)
 
(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 don’t try to time the market for small short-term pullbacks so I remain bullish. I expect a routine pullback to the lower trend line. A decline of about 4% from Friday’s close would be perfectly normal.
 
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 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 sooner rather than later.  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.