Dallas FED 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.

BIDEN SNUBS THE COURTS AGAIN ON STUDENT LOAN FOREGIVENESS (WSJ)
“‘That didn’t stop me,’ President Biden declared after the Supreme Court blocked his $430 billion student loan write-off in 2023. It sure didn’t. After striking out in court with three debt forgiveness schemes, the Administration on Friday unveiled another. Take that, judges. The Education Department says its proposed rule would authorize forgiveness for some eight million borrowers experiencing ‘hardship.’ ... Courts are playing whack-a-mole with the Administration’s debt write-offs that end-run Congress, which never authorized such broad-based debt forgiveness. Such lawlessness is one reason so many Americans discount the left’s assertions that Donald Trump endangers democracy. Mr. Biden acts like he’s king, and Democrats and media voices cheering him on have no standing to object if Mr. Trump follows the Biden precedent.” - The Editorial Board, WSJ. Opinion at...
https://www.wsj.com/opinion/biden-student-loan-forgiveness-supreme-court-education-department-7af30892
 
RUSSIA MAKES FAKE ELECTION VIDEO (LA Times)
“Russian actors were behind a widely circulated video falsely depicting mail-in ballots for Donald Trump being destroyed in Pennsylvania, U.S. officials confirmed Friday. The video had taken off on social media Thursday but was debunked within three hours by local election officials and law enforcement after members of the public reported it...the video’s detailed mimicking of ballots in a key county in this year's presidential race was a wake-up call that demonstrated how committed foreign actors are to undermining faith in the U.S. voting process in the critical stretch before voting concludes.” Story at...
Russian actors made fake video depicting mail-in ballots for Trump being destroyed, FBI says
 
ELECTRICITY IS CHEAPER THAN GAS? (MSN)
“The Biden-Harris administration has made a crackdown on residential fossil fuel consumption a key aspect of its environmental strategy, justifying the push in part on the grounds electrification will lower energy costs. Now, Oct. 17 residential energy price data from the Department of Energy (DOE) shows electricity was roughly four times as expensive as natural gas in 2024, with experts telling the DCNF the White House’s electrification push is an example of extremist climate policy hurting everyday Americans.
“The Department of Energy has consistently shown that natural gas is a much cheaper energy source for households than electricity,” Daren Bakst, director of the Competitive Enterprise Institute’s Center for Energy and Environment, told the DCNF [Daily Caller news Foundation]. “Government policies trying to block the use of natural gas in favor of electricity will significantly drive up prices, making home heating and appliance use needlessly expensive. The poor will get hurt the most because, compared to higher income households, they spend a greater share of their household income on meeting basic needs such as staying warm in the winter.” Story at...
‘Climate Extremism’: Biden-Harris Admin’s Own Data Undermines Its Fav Selling Point In Push To ‘Electrify Everything’
 
DALLAS FED MANUFACTURING (Dallas Fed)
“Texas factory activity rose notably in October, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, shot up 18 points to 14.6, its highest reading in more than two years.” Report at...
https://www.dallasfed.org/research/surveys/tmos/2024/2410
 
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.3% to 5824.
-VIX declined about 3% to 19.8.  
-The yield on the 10-year Treasury rose (compared to about this time, prior trading day) to 4.282%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
QLD – added 7/24.
SSO – added 10/16.
SPY – added 9/19 & more 10/16
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 12 gave Bear-signs and 8 were Bullish. The rest are neutral. (It is normal to have a lot of neutral indicators since many of the indicators are top or bottom indicators that will signal only at extremes.)

The daily Bull/Bear, 50-Indicator spread (Bull Indicators minus Bear Indicators, red curve in the chart above) declined to -4 (4 more Bear indicators and Bull indicators).
 
TODAY’S COMMENT:
Today’s Bull-Bear spread of -4 is slightly bearish to neutral. The 10-dMA of the 50-Indicator Spread (purple line in the chart above) remained bearish since it is still moving lower. (I follow the 10-dMA for trading buy-signals and as an indicator for sell signals.)
 
Indicators continue to slowly decline. I didn’t cut my stocks by much, but I did sell my leveraged position in UWM. I am sitting on that cash until the 10-dMA of the 50-Indicator, Bull-Bear spread turns higher.   
 
Indicators are suggesting that the decline may resume, but signals are not particularly strong. If the markets do turn down, I don’t expect much of a drop.
 
The 50-dMA is a little more than 2% lower than today’s close.
 
BOTTOM LINE
I’m neutral on the markets. If the pullback resumes, the drop should be small.
 
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 improved to HOLD. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges 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 when markets are stretched. (75% is my max stock allocation when I am confident that markets will continue higher.)
 
I trade about 15-20% of the total portfolio using the momentum-based analysis I provide here. When I see bullish signs, 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.