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.
 
“Earlier this week, Maine Gov. Janet Mills (D) decided not to veto an obscure law called the National Popular Vote Interstate Compact (NPV), which calls for the state's 4 Electoral College votes to be awarded to the presidential candidate who gets the most votes nationally regardless of the outcome in the state. The law doesn't go into effect, however, until states totaling 270 electoral votes join the compact.” – Newsweek at... 
The End of the Electoral College Is Finally in Sight | Opinion (msn.com)
My cmt: Odd. Why give up power to the masses? The electoral college was originally designed to ensure that the Presidential election went to the candidate winning a majority of the states.  That has changed some over the years, due to the way that the college votes are apportioned. But without the Electoral College, we become the United Cities (not States) of America; Cities are where the votes are. In the future, Presidents will ignore parts of the country and concentrate on cities. I’m tempted to say that the cities need the attention, but unfortunately, most cities have been in a death spiral my entire life – and I’m an old dude.

MARKET REPORT / ANALYSIS
-Friday the S&P 500 fell about 0.9% to 4967.
-VIX rose about 4% to 18.71.
-The yield on the 10-year Treasury declined to 4.621%.
 
MY TRADING POSITIONS:
QLD- Sold 4/8/2024
UWM – Sold 4/8/2024.
INTC – Sold 4/8/2024.
 
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
Salesforce was down over 7% Monday. News follows: “Salesforce (CRM) is reportedly in advanced talks to acquire data management software company Informatica (INFA), according to a Wall Street Journal report. The potential acquisition would allow Salesforce to boost its data integration and management capabilities by tapping into Informatica's product suite.” – Yahoo Finance.
 
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. (This position captures smaller cap and micro-cap stocks that are not included in the Dow Jones US Total Stock Market Index.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, the 50-indicator spread (Bulls minus Bears) remained 16 bear-signs and 8-Bull (the rest are neutral).
 

TODAY’S COMMENT:
A few thoughts supporting the bottom is now...or near:
-The 10-dMA of Bull Indicators minus Bear Indicators turned up today – not by much, but that has signaled an end to pullbacks in recent history (see the purple line in the chart above).
- I noted earlier that there was support in the 5000 area on the S&P 500. The S&P 500 didn’t hold there. The 100-dMA is next at 4935, less than 1% below today’s close. Strong support there.
-Bollinger Bands and RSI are both oversold; Late Day Action is oversold, too.
-New-lows are falling.  They peaked at 118 on Tuesday. Friday there were 39 new-lows. New-highs also bottomed on Tuesday, but they have not appreciably improved.
 
There have been 15 days down with only 1 or 2 up-days since the end of March. Quoting from a prior correction, “... we could be in one of these “selling stampedes” that tend to last 17 – 25 sessions, with only 1.5 to three-day pauses/throwback rallies, before they exhaust themselves on the downside...it [is] too soon to tell yet if this is such a stampede, but ‘Never on a Friday.’ The reference was that once the markets get into one of these weekly downside skeins, they rarely bottom on a Friday. Nope, they typically give participants over the weekend to brood about their losses and then they show up the next Monday in “sell mode” leading to Turning Tuesday.” - Jeffrey Saut, Wall Street Legend, Managing Partner of Saut Strategy.
My cmt: That would make this coming Tuesday a possible bottom.
 
I’ve been calling for an end to the pullback for several days. So far, that has not worked out. Hearing all the angst on CNBC one would think the index has collapsed. It’s a bit overblown; the S&P 500 has only dropped 5.5% below its all-time high just 3-weeks ago. I don’t think this pullback goes much farther. If today wasn’t the bottom, it is likely to be next week.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator declined to SELL (although I won’t be selling soon because we are seeing Bottom signals): PRICE & SENTIMENT are neutral; VOLUME & VIX are bearish.
(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
It still seems like this pullback is winding down.
 
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 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.