... 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.
 
UAVs OVER LANGLEY AIR FORCE BASE RAISE SECURITY QUESTINS (GPS World)
“The ‘Wall Street Journal’ has reported mysterious UAVs [unmanned aerial vehicles, i.e., drones] spotted surveilling some of America’s most sensitive military sites, leaving the Pentagon struggling to respond. These unidentified UAVs have been seen flying over military installations in Virginia and Nevada throughout the past year, including the secret base of the Navy’s elite SEAL Team Six and Naval Station Norfolk, recognized as the world’s largest naval port. Former U.S. Air Force Gen. Mark Kelly told The Wall Street Journal he first became aware of mysterious UAV sightings in December 2023, when officials at Langley Air Force Base in Virginia reported seeing dozens of UAVs flying over the base at night.” Story at...
https://www.gpsworld.com/unidentified-uavs-over-langley-air-force-base-raise-security-concerns/
 
ARMY ARSENAL SEEKS INFO ON DRONE FIGHTS (The War Zone)
“The U.S. Army’s Picatinny Arsenal in northern New Jersey is working with local, state, and federal partners to obtain more information about mysterious drone activity over the facility and in the surrounding area, a spokesman told us. His comments were in response to questions we asked about reports of strange drone activity near the facility that emerged on social media...” Story at...
https://www.twz.com/air/army-arsenal-seeking-info-on-mysterious-drone-flights-over-installation
 
CHINESE NATIONAL CONVICTED IN ESPIONAGE CASE (WAVY.com)
“Fengyun Shi [Chinese “student”] was flying the unmanned aircraft [drone] outside the 65th Street and Huntington Avenue Entrance of HII Newport News Shipbuilding when it got stuck in a tree. The SD card showed footage captured of U.S. Navy vessels or vessels intended for use by the Navy, according to court documents. This violates the Espionage Act, which prohibits a person of taking pictures of companies that manufacture classified military equipment. Shi was sentenced to six months for both counts.” Story at...
https://www.wavy.com/news/local-news/chinese-national-sentenced-for-espionage-after-flying-drone-over-nn-navy-ships/
My cmt: Looks like a clear pattern of espionage. What are the Chinese up to? Best case: Collecting information on an adversary. Worst case: Preparing for war. This is a prelude to taking Taiwan.
 
MARKET REPORT / ANALYSIS
-Friday the S&P 500 was up about 0.4% to 5969.
-VIX declined about 10% to 15.24.
-The yield on the 10-year Treasury declined (compared to about this time, prior trading day) to 4.412%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
SSO – added 10/16.
SPY – added 9/19 & more 10/16
QLD – added 11/5.
UWM – added 11/11
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 11 gave Bear-signs and 9 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) improved to -2 (2 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
Today’s Bull-Bear spread of -2 is NEUTRAL.
 
The 10-dMA of the 50-Indicator Spread (purple line in the chart above) is still falling today so the overall 50-Indicator spread signal is Bearish. (I follow the 10-dMA for trading buy-signals and as an indicator for sell signals.)
 
As I noted yesterday, Indicators bottomed on a daily basis on Thursday and rose again today.  The spread was -6 Thursday, so it appears we have seen an end of the minor weakness we’ve seen for the last 2 weeks or so. In the recent past, the daily indicators have bottomed when the S&P 500 bottomed.
 
In addition, there seem to be a lot of indicators that are improving. We might see a big positive switch in the indicators, but it is hard to predict when that may ocurr. That looks bullish.
 
BOTTOM LINE
I’m 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)
Intel and Dow Inc. have been replaced by Sherwin-Williams and Nvidia Corp. in the Dow Industrials.  It will take me a while to make changes to my programming.
 

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 that is most useful when it diverges from the Index.) 
 
 
 

...My current invested position is about 70% 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.