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.
 
“Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves.” - Peter Lynch, former manager of Fidelity’s Magellan® fund.
 
MORE STUDENT LOAN FORGIVENESS FROM BIDEN (CNBC)
“President Joe Biden unveiled his new plan to forgive student debt on Monday, less than a year after the Supreme Court blocked his initial attempt. “Today too many Americans, especially young people, are saddled with unsustainable debts in exchange for a college degree,” Biden said from an event in Madison, Wisconsin.”
https://www.cnbc.com/2024/04/08/bidens-student-loan-forgiveness-plan-could-erase-up-to-20000-in-interest.html
 
Here’s what we posted back in July of 2023 on the subject of Student Loan Forgiveness:
SUPREME COURT CONSERVATIVES BLOCK BIDEN’S STUDENT LOAN FORGIVENESS (Washington Post)
“The Supreme Court on Friday said President Biden does not have authority for his roughly $400 billion program to forgive student loan debt, the latest blow from a Supreme Court that has been dismissive of this administration’s bold claims of power.” Story at
https://www.washingtonpost.com/politics/2023/06/30/supreme-court-decision-student-loan-forgiveness/
My cmt: The Constitution is clear: Federal spending is controlled by the Legislative Branch, not the Executive Branch of Government. The most troubling fact in this decision is that 3 Justices of the Supreme Court don’t understand the Constitution, the very document they are enjoined to interpret. Didn’t they take Civics in high school? ...
... In reality, I think they understand the Constitution very well.  They just chose to ignore it (even though they swore an oath to uphold it) – the very definition of judicial hubris.
...Even Biden knew he didn’t have the authority to cancel the debt. Last year USA Today wrote, “During a weekend interview [in October 2022] with the progressive group NowThis News, President Joe Biden made the startling claim that he had ‘signed a law to forgive student debt.’  After going into some detail about how much the ‘law’ would offer 40 million Americans, he also said, ‘It’s passed. I got it passed by a vote or two, and it’s in effect.’” Story from USA Today at...
https://www.usatoday.com/story/opinion/columnist/2022/10/26/biden-student-debt-relief-gaffe-should-alarm-all-americans/10595785002/
Biden’s claim wasn’t true, of course. This is just another example of our President’s declining mental facilities; but at least he understands the Constitution, or did 8 months ago.
 
NFIB BUSINESS OPTIMISM (Fox Business)
“NFIB's Small Business Optimism Index, which is compiled monthly through a survey of small businesses, decreased in March by 0.9 of a point to 88.5, which is lowest reading since December 2012 and marks the 27th consecutive month with the index below the 50-year average of 98.” Story at...
https://www.foxbusiness.com/economy/small-business-optimism-hits-lowest-level-since-2012-nfib
 
MARKET REPORT / ANALYSIS
-Tuesday the S&P 500 rose about 0.1% to 5210.
-VIX slipped about 1% to 14.98.
-The yield on the 10-year Treasury dipped to 4.362%.
 
MY TRADING POSITIONS:
XLK – Technology ETF (holding since the October 2022 lows). I don’t want to pay taxes on this gain, so I am holding this position.
CRM – Added 1/22/2024
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 tax-deferred, retirement account betting on Smaller Caps.
 
TODAY’S COMMENT:
CPI is due out Wednesday, so that may be why markets have been unsettled recently. This time, we’re not getting a signal from markets to indicate whether CPI will be good or bad. That might suggest a so-so CPI that the market won’t celebrate.
 
The Index remains below its lower trendline (depending on the scales used to draw the charts). The 10-dMA of Indicator Spread is still falling so we can’t feel too confident.  A good CPI report would probably ease some investor worry.
 

CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, there are 12 bear-signs and 11-Bull. It was 15 Bear and 7 Bull Monday, so indicators improved slightly, but the 10-dMA of the indicators continued to fall. The daily spread did improve and we can expect the 10-day will reverse higher if that daily trend continues.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained HOLD: PRICE is positive; SENTIMENT, VOLUME & VIX are neutral.
(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 am bullish longer-term, but Neutral for now. I expect that any correction (if the S&P 500 did have one) would be less than 10%, but I am not predicting a correction today. 
 
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 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 50% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks, so this is a fully-invested position.
 
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.