CPI ... Retail Sales ... Empire State Manufacturing ... 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.
 
“One of the painful signs of years of dumbed-down education is how many people are unable to make a coherent argument. They can vent their emotions, question other people’s motives, make bold assertions, repeat slogans—anything except reason.” ― Thomas Sowell, senior fellow at the Hoover Institution.
 
MISSION OF UCLA ANTI-ISRAEL RALLY – ACTUAL REVOLUTION (FOX News)
“A watchdog organization with a focus on higher education released video this week showing an operative from an outside communist group taking part in an anti-Israel protest on the campus of the University of California, Los Angeles. ‘I'm a revolutionary organizer,’ a woman named ‘Annie’ tells an undercover journalist with Accuracy in Media in a video released on Wednesday. ‘I'm an outside agitator,’ she adds with a smile…’We're a little bit different because we're about getting organized for an actual revolution.’ Revcom, led by political activist Bob Avakian, is described by Influence Watch...continues to spread its message of communist ideas and replacing the government system in the United States." Story at...
'An actual revolution': Communist Party organizer reveals true mission at UCLA anti-Israel rally (msn.com)
 
CPI (CNBC)
"Inflation eased slightly in April, providing at least a bit of relief for consumers while still holding above levels that would suggest a cut in interest rates is imminent. The consumer price index, a broad measure of how much goods and services cost at the cash register, increased 0.3% from March... On a 12-month basis, however, the CPI increased 3.4%, in line with expectations...” Story at...
https://www.cnbc.com/2024/05/15/cpi-inflation-april-2024-consumer-prices-rose-0point3percent-in-april.html
Core CPI came in as expected.
 
RETAIL SALES (Yahoo Finance)
“The US consumer showed signs of slowing in April. Retail sales were flat in the month, according to data from the Commerce Department, furthering concerns about the state of the consumer amid sticky inflation and higher interest rates." Story at...
https://finance.yahoo.com/news/retail-sales-flat-in-april-falling-short-of-wall-streets-expectations-123315122.html
Sales were below expectations.
 
NY FED MANUFACTURING (NY FED)
“Business activity continued to decline in New York State, according to firms responding to the May 2024 Empire State Manufacturing Survey. The headline general business conditions index was little changed at -15.6. New orders declined significantly, while shipments held steady. Unfilled orders continued to decline. Delivery times shortened, and inventories were little changed. Labor market conditions remained weak, with employment and hours worked continuing to move lower. The pace of input and selling price increases moderated slightly. Though firms expect conditions to improve over the next six months, optimism was subdued.” Report at...
https://www.newyorkfed.org/survey/empire/empiresurvey_overview
 
CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 2.5 million barrels from the previous week. At 457.0 million barrels, U.S. crude oil inventories are about 4% below the five-year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf
This report shows strong demand continues for crude suggesting continued pricing strength.
 
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 rose about 1.2% to 5308.
-VIX declined about 7% to 12.45.
-The yield on the 10-year Treasury declined to 4.342%.
 
MY TRADING POSITIONS:
UWM – Added 5/2/2024
QLD – Added 4/29/2024
SSO – Added 4/29/2024.
XLE – Added 4/24/2024
 
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.
 
DWCPF - Dow Jones U.S. Completion Total Stock Market Index. – Added 12/7/2023 when I sold the S&P 500.
“The Dow Jones U.S. Completion Total Stock Market Index, also known as the DWCPF, is a widely used financial index that provides a comprehensive measure of the US equity market. The DWCPF includes all US stocks that are not included in the Dow Jones US Total Stock Market Index, which comprises large-cap and mid-cap companies. As a result, the DWCPF provides a complete picture of the US stock market, including small-cap and micro-cap companies, which are often overlooked by other indexes.” From...
https://fi.money/blog/posts/what-is-dow-jones-u-s-completion-total-stock-market-index-dwcpf
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
The Bull/Bear Spread (Bull Indicators minus Bear Indicators) remained bullish at 7 Bear-signs and 18-Bull. (The rest are neutral. It is normal to have a lot of neutral indicators since many of those are top or bottom indicators that will signal only at extremes.) The 10-dMA of spread (purple line in the chart below) continues to improve, a bullish sign.

TODAY’S COMMENT:
It didn’t take long for the S&P 500 to make new highs. Wednesday, the S&P 500 made an all-time high about 1% higher than the March high. 10.1% of issues on the NYSE made new 52-week, all-time highs Wednesday. The average number for this stat is about 6.7% so this indicates that the advance has been healthy so far. If there were to be a correction now (and I am not predicting one), it is likely that it would be a normal, less than a 10% pullback.
 
There was a new bear sign today in the indicators. The S&P 500 is now 12.2% above its 200-dMA. That’s a worrisome high that is will eventually be a drag on the markets. At the prior top in March, the Index got to 13.8% above its 200-dMA before the 5.5% “correction” that finished 19 April. Charts look OK now so I won’t worry about this indicator for now.
 
Regarding that April bottom, I added to stock holdings 3-sessions after the bottom and went “all-in” 6-sessions after the bottom. So far, the indicator that I refer to as the “Summary of 50-Indicator Spread” is proving its worth.
 
As reported on CNBC, Bank of America now calling a year end value of 5600 on the S&P 500. That’s about 5.5% higher than today’s close. Seems to me that it can go higher than that, but I won’t hazard a guess. We’ll just watch and see what happens.
 
LONG-TERM INDICATOR: The Long Term NTSM indicator remained BUY: PRICE & VOLUME are bullish; VIX & SENTIMENT 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.
 
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)
I forgot to update this chart yesterday, but below is Friday’s chart. 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 75% stocks, including stock mutual funds and ETFs. I’m usually about 50% invested in stocks, so this is a bullish, over-invested position. This is my max % for stock allocation.
 
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, usually by using an S&P 500 ETF as I did back in October 22 and 23.