CPI ... Business Optimism ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...
“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
"Maybe the problem isn't that America isn't worth defending.
Maybe the problem is that lots of people today are entitled whiners who have no
perspective and no idea how good they have it... In 2016, Eddie Griffin
said, 'If Trump wins I'm moving to Africa' - apparently very slowly because in
Trump's four years, he only got as far as Van Nuys.... "The New Republic
just ran a story about the vulnerable minorities who want to flee America,
including the author- a gay man trapped in the dystopian homophobic hellscape
that is New York City. I wonder if he knows that there are 66 countries where
just being gay is a crime." – “Real Time” host, Bill Mahr.
https://www.foxnews.com/media/bill-maher-rips-america-bashing-celebs-vowed-flee-country-under-trump-still-here
“At the Super Bowl, the world watched as Kansas City
Chiefs superstar Travis Kelce screamed and then purposely bumped into the head
of his coach, Andy Reid. This behavior by Kelce, one of the team captains,
reminded me of a recent reflection I had on too many of today’s “leaders” as
compared to those of not very long ago. Consider the leaders from our past:
Andrew Carnegie. Henry Ford. FDR. Harry Truman. Billy Graham. Ronald Reagan.
Within a few generations, our model of good leadership has changed dramatically.”
- Brian Hamilton, Opinion.
https://fortune.com/2024/02/13/travis-kelce-super-bowl-behavior-coach-emblematic-rise-of-the-jerk-culture-success/
CPI / CORE CPI (WSJ)
“Inflation cooled again in January but came in above Wall
Street’s expectations, another sign that the Federal Reserve’s path to
interest-rate cuts is far from settled. The Labor Department reported
Tuesday that consumer prices rose 3.1% in January from a year
earlier... Core prices, which exclude food and energy items in an effort to
better track inflation’s underlying trend, were up 3.9% in January.” Story
at...
https://www.wsj.com/economy/consumers/what-to-watch-in-the-cpi-report-will-inflation-fall-below-3-ffc5859a
BUSINESS OPTIMISM (NFIB)
“The NFIB
Small Business Optimism Index decreased two points in
January to 89.9, marking the 25th consecutive month below the 50-year
average of 98. The net percent of owners who expect real sales to be higher
declined 12 points from December to a net negative 16% (seasonally adjusted), a
very negative shift in expectations.” Press release at...
https://www.nfib.com/content/press-release/economy/small-business-owners-expectations-for-higher-sales-declined-in-january/
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 dropped about 1.4% to 4953.
-VIX rose about 13% to 15.78.
-The yield on the 10-year Treasury rose to 4.316%.
MY TRADING POSITIONS:
UWM – Added 1/22/2024.
XLK – Technology ETF (holding since the October 2022
lows).
INTC – Added 12/6/2023.
CRM – Added 1/22/2024
BA – Added 12/6/2023. I plan to hold Boeing for the time
being.
DWCPF - Dow Jones U.S. Completion Total Stock Market
Index. – Added 12/7/2023 when I sold the S&P 500. This is a large position
in my retirement account betting on Small Caps.
TODAY’S COMMENT:
Both CPI and Core CPI disappointed the markets today. I
had hoped for some cooling in the markets, but not this much! (Be careful what
you wish for.) We had been watching the Russell 2000 outperform the S&P 500
recently as investors expected a “good” CPI report today. That was not the case as the interest
sensitive Russell gave up its recent gains.
Today, more than 90% of volume
was down-volume. That’s a bearish sign. Lowry Research says, “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.“
If more do follow, the downtrend is likely to continue until we see a 90%
up-volume day.
The Friday Summary of indicators (about 50-indicators) dropped
to a neutral 50-50 position.
Not all the news was bad today...
Tuesday 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.
The Index was very close to lower trend line at the close
and that level may hold.
The S&P 500 is 10.8% above its 200-dMA so that
bearish indicator (>12%) has cleared.
There was a good bounce higher at the end of the day so
there could be follow-thru dip buying tomorrow. I did buy some more UWM (2x Russell 2000) late
in the day. (Glutton for punishment.)
The daily spread of 20 short-term Indicators (Bulls minus
Bears) declined from +3 to -8 (a positive number is bullish; negatives
are bearish); the 10-day smoothed sum that smooths the daily fluctuations declined
from +16 to +2. (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; SENTIMENT, VOLUME & VIX 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 remain bullish, but we’ll see. Indicators are neutral so it’s watch and
wait.
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 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 65% stocks, including stock mutual funds and ETFs. I’m
usually about 50% invested in stocks. I’m “over invested” now expecting
continuation of bullish market action.
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.
