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.
TRUMP MEETS WITH CEO’S (Walmart’s Doug McMillon, Apple’s
Tim Cook and JPMorgan Chase’s Jamie Dimon)
“...you know, Jeb Bush ultimately was right...He [Donald
Trump] is the chaos candidate, it was a chaos presidency and I would just
remind these people that they weren’t happy when he was president. Yes they got
their tax cuts but we’ve also ballooned the deficit and that is gonna come home
to roost for these CEOs... He’s better in those rallies where he can talk
about electric boats and shark attacks, exactly. He’s way better
at that than he would be actually articulating economic policy in front of
Fortune 500 CEOs.” - Anthony Scaramucci, Former White House Communications
Director. From...
Anthony
Scaramucci Scorches CEOs With 1 Blistering Description Over Trump Meeting
(msn.com)
EMPIRE STATE MANUFACTURING (sharecast)
“Manufacturing activity in the state of New York weakened
again in June, according to a survey released on Monday. The Empire
State manufacturing index ticked up 10 points to -6.0 but
remained below the zero level.” Story at...
https://www.sharecast.com/news/news-and-announcements/ny-empire-state-manufacturing-index-contracts-again--16951775.html
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.8% to 5473
-VIX rose about 0.7% to 12.75.
-The yield on the 10-year Treasury rose to 4.267%.
MY TRADING POSITIONS:
UWM – Added 5/2/2024
QLD – Added 4/29/2024
XLK – Holding since the October 2022 lows.
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)
was 13 Bear-signs and 14-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) is moving higher, a bullish sign.
TODAY’S COMMENT:
Monday there was another Hindenburg Omen. That’s the second
in the last three sessions and the third in the last three weeks.
Investopedia says, “The Hindenburg Omen is a technical
indicator that was designed to signal the increased probability of
a stock market
crash. It compares the percentage of new 52-week highs and new 52-week lows in
stock prices to a predetermined reference percentage that is supposed to
predict the increasing likelihood of a market crash...
The Hindenburg Omen looks for a statistical deviation from the premise that
under normal conditions, some stocks are either making new 52-week highs or new
52-week lows. It would be abnormal if both were occurring at the same time.”
From Investopedia at...
https://www.investopedia.com/terms/h/hindenburgomen.asp
This time, the short-term Fosback Hi/Low Logic indicators
is close to bearish. This indicator also
looks at the number of new-highs and new-lows in a somewhat similar style of
analysis as the Hindenburg Omen indicator. It is well known that the Hindenburg
is not always right, but there were Hindenburg and short-term Fosback Hi/Low
Logic warnings around the top in November of 2021 before the 25% decline. There
are worrying signs in new-high/new-low data, too.
There were only 74 new-highs Monday on a day when the
S&P 500 made a new all-time high.
That suggests a narrow advance. This indicator has presaged corrections
of 10% or greater. Breadth is also a worry.
The 10-dMA of issues advancing on the NYSE is still below
50%, indicating that for the periods 2-weeks, less than half of all issues on
the NYSE have up. These stats just reinforce the narrow advance.
We don’t yet expect a big decline to start now. The Bull/Bear indicator spread is +1 (1 more
Bull indicators than bear indicators). This is a Neutral indication, but the S&P
500 is 13.4% above the 200-dMA. The bear sign is greater than 12% so this can
be a drag on markets.
A correction could start now (one could start any time
for that matter); but my guess, based on indicators, is that a correction is
not here yet.
LONG-TERM INDICATOR: The Long Term NTSM indicator
remained BUY: PRICE, VOLUME & VIX are bullish; SENTIMENT is 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 neutral. Markets are stretched and breadth is looking
weak. A 10% retreat is possible, although we don’t have a sell signal at this
point.
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)
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
MONDAY 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, so this is a bullish, over-invested
position. 75% is my max stock allocation so I have some cash now.
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 2022 and 2023.
