... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

 

 
STOCKS ON PACE FOR BEST TWO YEARS IN A QUARTER CENTURY (WSJ)
 
“The S&P 500 has climbed 24%, notching 57 record closes as the economy remained healthy, inflation ticked lower and an AI-fueled rally in big tech stocks powered on. Even with a stumble in the last few trading days, the broad U.S. stock index is on pace for its best consecutive years since 1997 and 1998, according to Dow Jones Market Data, during the lead-up to the bursting of the dot-com bubble... the biggest tech stocks continued to do much of the work of powering the S&P 500 higher. Through Dec. 24, the Magnificent Seven—Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla—accounted for more than 53% of the stock index’s total return...” Story at...
https://www.wsj.com/finance/stocks/stocks-on-pace-for-best-two-years-in-a-quarter-century-c5b5f9b3?mod=md_usstk_news
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Tuesday the S&P 500 declined about 0.4% to 5882.
-VIX slipped about 0.4% to 17.35. (Options players don’t seem very worried.)
-The yield on the 10-year Treasury rose (compared to about this time, prior trading day) to 4.573%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – added 12/20. (IRA acct.)
SPY – added 12/20. (IRA acct.)
QLD – added 12/20. (IRA acct.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 19 gave Bear-signs and 5 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) remained -14 (14 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
As I noted yesterday, a crash is aways coming – we just don’t know when. Looking back, we note that my indicators got me out at or near the top of the Financial Crisis, the Covid pandemic and the 25% decline in 2022. I called the bottoms within days of these crisis’ except for Covid when I waited for a retest of the low that never happened – we learned from that one.
 
I would expect we’ll see the signs of a crash before it starts in earnest.  So far, those signs have not occurred. One important sign is a narrowing of breadth at an all-time high. While breadth has narrowed during the recent weakness, almost 5% of issues on the NYSE made new 52-week highs when the S&P 500 made its all-time high on 6 December. That is not a stat that is associated with crashes; for now, no crash is forecast.
 
The bull-bear indicator spread remained -14 today. It was -18 at the 19 December low so there is a bullish divergence between the indicators and the S&P 500 value. This is indicated by green arrows on the above chart.
 
The Index dropped 1% below its 50-dMA and Tuesday’s close was 0.2% above the closing low of 5867 on 19 December. Internals were uniformly better, suggesting a bottom.  The fly in the ointment? I’d prefer a lower-low for this analysis and we didn’t get that today. Is it close enough? Probably yes, so my guess is that the weakness is ending.  
 
One third of all volume today was unchanged volume and that qualifies as High-unchanged volume. As I’ve often said, many believe that this indicator suggests investor confusion at market turning points. The trend has been down for a while so this suggests a reversal higher is in the works; however, “High-unchanged-volume” is not one of my indicators because it is often wrong.
 
BOTTOM LINE
I think the weakness is ending, but then, I predicted this a week ago, too. (Why do you read this blog?)
 
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
 
TUESDAY 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. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.
 

Chicago PMI ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

NY TO TAX AMERICA FOR CLIMATE CHANGE (WSJ)
“Gov. Kathy Hochul on Thursday signed legislation that will require fossil-fuel producers to pay $75 billion to supposedly help the state adapt to climate change. “This landmark legislation shifts the cost of climate adaptation from everyday New Yorkers to the fossil fuel companies most responsible for the pollution,” Ms. Hochul’s office declared. She’s right about shifting costs, but those who will pay her climate tax are American fossil-fuel workers and consumers [nationwide]... Ms. Hochul has given the [Supreme Court] Justices another reason to take the case. Otherwise, the climate extortion by spendthrift progressive governments will never end. Similar bills have been proposed in other Democratic-run states including California, Maryland and Massachusetts. Americans used to call this taxation without representation.” – Editorial Board, WSJ from...
https://www.wsj.com/opinion/kathy-hochul-new-york-climate-superfund-taxes-10b132bb?mod=trending_now_opn_3
 
CHICAGO PMI (Investing.com)
“In a recent economic event, the Chicago Purchasing Managers' Index (PMI) reported a score of 36.9, suggesting a contraction in the manufacturing sector of the Chicago region. The PMI score of 36.9 is significantly lower than the forecasted 42.7, indicating a more severe contraction in the manufacturing sector than initially anticipated." Story at... 
https://www.investing.com/news/economic-indicators/chicago-pmi-dips-lower-than-expected-indicating-manufacturing-contraction-93CH-3791583
 
CAPE (CYCLICALLY ADJUSTED PE RATIO) SUGGESTS A CRASH IS COMING (msn)
“...the S&P 500's Shiller P/E is based on average inflation-adjusted earnings over the previous 10 years....

S&P 500 Shiller CAPE Ratio© YCharts
 
...On Dec. 24, the S&P 500's Shiller P/E Ratio closed at 38.35, which is within striking distance of its yearly high of almost 39. For added context, this is more than double its average reading of 17.19 over the last 154 years and represents the third-highest reading during a continuous bull market since January 1871... There have been only six occurrences of the Shiller P/E surpassing 30 during a bull market rally in 154 years, including the present, and all five prior instances saw the Dow Jones Industrial Average, S&P 500, and/or Nasdaq Composite eventually lose between 20% and 89% of their value.” Story at...
Is the Stock Market Going to Crash in 2025? 2 Historically Flawless Indicators Paint a Clear Picture.
My cmt: A crash is always coming; we just don’t know when. Further, the CAPE doesn’t predict when either. It’s not a good market timing indicator.
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Monday the S&P 500 declined about 1.1% to 5907.
-VIX rose about 9% to 17.40.
-The yield on the 10-year Treasury declined (compared to about this time, prior trading day) to 4.533%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – added 12/20. (IRA acct.)
SPY – added 12/20. (IRA acct.)
QLD – added 12/20. (IRA acct.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 19 gave Bear-signs and 5 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) remained -14 (14 more Bear indicators than Bull indicators) – same as Friday’s spread.
 
TODAY’S COMMENT
Repeating: The spread of -14 is better than the low of -18 at the 19 December S&P 500 low so I am not concerned. While we don’t like to see spreads fall after a bottom, it looks like there are enough indicators that are close to bullish, we could see a turn higher this week.
 
The 50-dMA of the S&P 500 is 5942. The Index dropped 0.6% below its 50-dMA Monday so that is a concern. The S&P 500 may test its 19 December low of 5867.  We may learn some new information if it does.
 
I’ve redrawn the short-term, lower trendline to incorporate the 19 December low. That puts Monday’s close at the lower trendline. Is today a bottom? We don’t know. We’ll have to watch the indicators.  
 
BOTTOM LINE

Since the 50-dMA has been violated we must be more concerned that declines may continue. We don't want to see the S&P 500 fall much further. 
 
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, but for now, I won’t pay attention to this indicator. (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. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.

Short Post today

 
Busy day today, so here’s a short post on the markets as of 2:30PM. I’ll only post again if there are significant changes at the close.
 
The S&P 500 is down more than 1%; VIX is up 13% and the 10-Year Bond Yield rose to 4.619%.
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 19 gave Bear-signs and 5 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, as of 2:30pm) declined to -14 (14 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
CNBC’s Bob Pisani noted that there was no buying today, i.e., today’s poor results were due to a lack of buying more than selling. It could be, but overall, volume projects to be above normal for a holiday period so I can’t say I know why markets were down. The 10-year bond yield is up to 4.615% and that seems to be as good a reason as any.
 
Today’s Bull-Bear spread of -14 is bearish, however, the more important indication was the improvement in the daily bull-bear spread Thursday. The chart showed a dramatic increase in the bull-bear spread and that is the improvement that signals the recent weakness is very likely over.
 
The spread of -14 is still better than the low of -18 at the 19 December S&P 500 low so I am not concerned. While we don’t like to see spreads fall after a bottom, it looks like there are enough indicators that are close to bullish, we could see another turn higher next week.
 
The 50-dMA of the S&P 500 is 5941. I’ll worry if the Index drops below its 50-dMA.
 
BOTTOM LINE
Indicators suggested the weakness is over and I am sticking with that call for now.

Jobless Claims ... Richmond Fed ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

 

RICHMOND FED (msn.com)
“The Richmond Fed Manufacturing Index drifted up to -10 in December from -14 in November, matching the consensus.
The future indexes for shipments and new orders rose further into positive territory, suggesting that many firms expected improvements over the next six months, the Richmond Fed said on Tuesday.” Story at...
https://www.msn.com/en-us/money/markets/richmond-fed-manufacturing-index-improves-in-december-as-expected/ar-AA1wqVuu?apiversion=v2&noservercache=1&domshim=1&renderwebcomponents=1&wcseo=1&batchservertelemetry=1&noservertelemetry=1
 
JOBLESS CLAIMS (AP News)
“Jobless claim applications ticked down by 1,000 to 219,000 for the week of Dec. 21, the Labor Department reported Thursday. That’s fewer than the 223,000 analysts forecast.” Story at...
https://apnews.com/article/unemployment-benefits-jobless-claims-layoffs-labor-6262fe3a1be56945af52f8bb5ed27d97
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Thursday the S&P 500 was little changed at 6038.
-VIX rose about 3% to 14.73.
-The yield on the 10-year Treasury was little changed (compared to about this time, prior trading day) to 4.587%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – added 12/20. (IRA acct.)
SPY – added 12/20. (IRA acct.)
QLD – added 12/20. (IRA acct.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 17 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) improved to -9 (9 more Bear indicators than Bull indicators) compared to the previous reading of -15.
 
TODAY’S COMMENT
Today’s Bull-Bear spread of -9 is bearish, however, the more important indication is the improvement in the daily bull-bear spread – that improvement is Bullish. The chart shows a dramatic increase in the bull-bear spread and that is the improvement that signals the recent weakness is very likely over.
 
BOTTOM LINE
Indicators suggest the weakness is over.
 
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
 
THURSDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals declined to SELL, but for now, I won’t pay attention to this indicator. (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. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.

Indicators Slowly Improving

 
Merry Christmas and Happy Hanukah.
 
Improving daily indicator spread (Red in the below chart) still suggests the bottom was last Thursday.
 

Consumer Confidence ... Durable Goods ... New Home Sales ... National Activity Index ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

 
"Bipartisan' usually means that a larger-than-usual deception is being carried out." - George Carlin
 
NATIONAL ACCTIVITY INDEX (Chicago Fed)
“Index Suggests Economic Growth Increased in November:
The Chicago Fed National Activity Index (CFNAI) increased to –0.12 in November from –0.50 in October. Three of the four broad categories of indicators used to construct the index increased from October, but all four categories made negative contributions in November. The index's three-month moving average, CFNAI-MA3, decreased to –0.31 in November from –0.27 in October.” Report at...
https://www.chicagofed.org/research/data/cfnai/current-data
 
DURABLE GOODS (nasdaq.com)
“New orders for U.S. manufactured durable goods slumped by much more than expected in the month of November, according to a report released by the Commerce Department on Monday. The report said durable goods orders tumbled by 1.1 percent in November after climbing by an upwardly revised 0.8 percent in October.” Story at...
https://www.nasdaq.com/articles/us-durable-goods-orders-pull-back-more-expected-november
 
CONSUMER CONFIDENCE (Univ of Michigan)
“Consumer sentiment confirmed its early-month reading, rising for the fifth consecutive month and reaching its highest value since April 2024. Buying conditions exhibited a particularly strong 32% improvement, primarily due to a surge in consumers expecting future price increases for large purchases.” Report at... 
http://www.sca.isr.umich.edu/
 
NEW HOME SALES (Yahoo Finance)
“Sales of new U.S. single-family homes rebounded in November after being depressed by hurricanes in the prior month, but rising mortgage rates could hamper sales next year. New home sales jumped 5.9%...” Story at...
https://finance.yahoo.com/news/us-home-sales-rebound-november-153802284.html
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Monday the S&P 500 rose about 0.7% to 5974.
-VIX declined about 8% to 16.93.
-The yield on the 10-year Treasury rose (compared to about this time, prior trading day) to 4.589%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – added 12/20. (IRA acct.)
SPY – added 12/20. (IRA acct.)
QLD – added 12/20. (IRA acct.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 21 gave Bear-signs and 4 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 -17 (17 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
Today’s Bull-Bear spread of -17 is bearish. The worrisome sign is that the spread declined.  There were 2 fewer bull-signals and 1 fewer bear-signal. We don’t like to see indicators falling after it appeared that markets made a bottom.  Let’s hope the indicators improve tomorrow.
 
On the good side, Price was bullish today – all of the major indices were up, except for the Russell 2000.
 
The 10-dMA of the 50-Indicator Spread (purple line in the chart above) continued down today so that is a bearish signal. (I follow the 10-dMA for trading buy-signals and as an indicator for sell signals.)
 
Still, I remain bullish and I am betting that the S&P 500 did make a bottom last week.
 
If declines do return/continue, here are some support levels where declines may end:
100-dMA – S&P 500, 5743
October lows: S&P 500, 5700
200-dMA: about S&P 500, 5520
 
BOTTOM LINE
Since price action was good today, I’ll stay with last week’s call; the weakness appears to be over, or close to over.
 
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 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. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.
 

PCE Prices ... Personal Income ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

"Bipartisan' usually means that a larger-than-usual deception is being carried out." - George Carlin
 
"Doesn't expecting the unexpected make the unexpected expected?" – Bob Dylan
 

Michael Ramirez, political commentary at...
https://michaelpramirez.com/index.html#/
If you don’t get the above cartoon, search “Dewey Defeats Truman.”
 
RFK, THE MEDIA AND ME (WSJ - Excerpt)
“The mainstream media is deliberately stoking fear and outrage about vaccines in an attempt to derail Donald Trump’s nomination of Robert F. Kennedy Jr. to head the Department of Health and Human Services.... The attempts to stoke fear are based on legal work I did for a different client, which I never discussed with Mr. Kennedy. Reports recently published in the New York Times and elsewhere mischaracterize the contents of three petitions my firm filed with the Food and Drug Administration from 2020-22 on behalf of a client, Informed Consent Action Network. One of these petitions related to IPOL, which is one of the six polio-containing vaccines currently licensed by the FDA. The petition wouldn’t affect the other five vaccines. No one, least of all our client, wants anyone to have polio. The goal is simply to ensure that vaccines are subject to proper testing for safety and efficacy. The media falsely claimed the petition sought to eliminate all polio vaccines... The scope of our client’s petition was narrow. It simply asked the FDA to require a proper trial for approval of IPOL... Included in many of the stories about the petition was the case of an unvaccinated man who reportedly contracted polio in New York in 2022. Left out was that he had a strain of polio derived from a vaccine, not the wild polio virus. The last documented case of wild polio in the U.S. was in 1979.” - Aaron Siri, managing partner of Law Firm, Siri & Glimstad. Commentary at... 
https://www.wsj.com/opinion/rfk-polio-pinocchio-and-me-media-distortion-legal-work-vaccine-safety-3b50062a?mod=hp_opin_pos_4
My cmt: It surprises me how the media continues to falsely report stories regarding Trump and his nominees. Do these people have any ethics?
 
PCE PRICES (CNBC)
“The personal consumption expenditures price index, the Fed’s preferred inflation gauge, showed an increase of just 0.1% from October. The measure indicated a 2.4% inflation rate on an annual basis, still ahead of the Fed’s 2% goal, but lower than the 2.5% estimate from Dow Jones.” Story at...
https://www.cnbc.com/2024/12/20/pce-inflation-november-2024-.html
 
PERSONAL INCOME (Floor Daily)
“Personal income increased $71.1 billion (0.3% at a monthly rate) in November...” From...
https://www.floordaily.net/flooring-news/personal-income-rose-03-in-november-spending-up-04
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Friday the S&P 500 rose about 1.1% to 5931.
-VIX declined about 24% to 18.36.
-The yield on the 10-year Treasury declined (compared to about this time, prior trading day) to 4.530%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – added 12/20. (IRA acct.)
SPY – added 12/20. (IRA acct.)
QLD – added 12/20 (IRA acct.)

 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 22 gave Bear-signs and 6 were Bullish. (Yesterday, there were 21 bear-signs and 6 bull-signs. I adjusted an indicator.) 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 -16 (16 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
Today’s Bull-Bear spread of -16 is bearish, but the indicators turned up from -18, so that’s a good sign. This sort of validates the buy-signal yesterday. We would like to have seen a bigger improvement, but we’ll take it.  The 10-dMA of the 50-Indicator Spread (purple line in the chart above) continued down today so that is a bearish signal. (I follow the 10-dMA for trading buy-signals and as an indicator for sell signals.) The 50-Indicator spread is conflicted – or at least I am in trying to interpret the improvement. There were good signs today:
-83% of the volume on the NYSE was up-volume. We also noted High-unchanged volume. As I’ve often said, many believe that this indicator suggests investor confusion at market turning points. The trend has been down for a while so this suggests a reversal higher is in the works. “High-unchanged-volume” is not one of my indicators because it is often wrong. The last time we saw this signal (13 November) the S&P 500 rose about 2% before this recent weakness started.
-Friday was a Follow-thru day.
-The S&P 500 close slightly above its 50-dMA.
-There was a nice turn higher in the “Buying-pressure minus Selling-pressure” indicator.
 
On the bearish side of the ledger, we still see a lot of bearish indicators.
 
Friday was a statistically significant up-day. That just means that the price-volume move exceeded my statistical parameters. Statistics show that a statistically-significant, up-day is followed by a down-day about 60% of the time. 
 
I wrote Thursday, “I suspect that the declines are over or nearly over.” Friday’s price action tends to support that conclusion.
 
As always, there are no guarantees. If declines do continue, here are some support levels where declines may end:
100-dMA – S&P 500, 5743
October lows: S&P 500, 5700
200-dMA: about S&P 500, 5520
 
BOTTOM LINE
The weakness appears to be over, or close to over.
 
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
 
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. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.

Buying Stocks

Today we see a Bullish Outside Reversal and Follow-thru Day coming on the heels of yesterday’s near buy-signal.  As of noon, the volume is almost 90% up-volume, another bullish sign. Market action is confirming that there was a buy-signal Thursday, so I am going back into the markets. I’ll add:
SPY
SSO
QLD

GDP ... Philly Fed ... Jobless Claims ... Leading Economic Index ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis

CRAZY THINGS IN THE CONTINUING RESOLUTION
“Critics claim the continuing resolution is filled with provisions that would waste hundreds of billions of dollars on nonsense... Here are some of the provisions drawing the biggest blowback from conservatives, many of which were identified on X by users like Small Gov Lizard:
・Members of Congress would be allowed their first pay raise since 2009
・A provision that allows lawmakers to opt out of Obamacare and use the Federal Employees Health Benefits Program instead. [Lawmaker staffs would still be required to use Obamacare as are lawmakers under existing law. Obamacare was supposed to be such a god deal that Congress required members to be covered by it.  Apparently, they have changed their minds.]
・Language on transparency in concert ticket pricing
・The federal government paying the entire bill to rebuild the Francis Scott Key Bridge.
・Accountability for recycling and composting fraud
・A “Feral Swine Eradication” program
・A continuation of the “Wool Trust Fund” until 2025
・Paying for juvenile delinquents to get their driver’s license
・No longer calling homeless adults and children “homeless”
・Extending a “sheep marketing grant program” until 2025
・The Global Engagement Center, the State Department’s office dedicated to censorship, will get another year of funding
・Spending $3 million dollars to test the inspection of molasses
These provisions and more have many House Republicans extremely frustrated with GOP leadership.
Story at...
The Craziest Things Congress Snuck Into Its Pork-Packed Christmas Spending Spree
 
GDP / PCE PRICES (pymnts.com)
“In the latest and final revision of how the economy fared in the third quarter — through the growth in gross domestic product — the headline is that growth was healthy. GDP was better than expected, and it’s almost always the case that GDP’s direction rests firmly on the shoulders of U.S. consumers’ spending, which accounts for roughly 70% of the figure. GDP increased at a 3.1%...The PCE price index — a measure of inflation — rose by 1.5% in Q3, continuing its downward trend...” Story at...
https://www.pymnts.com/economy/2024/consumer-spending-lifts-q3-gdp-savings-rates-are-pressured/
 
PHILLY FED (Yahoo Finance)
“The Federal Reserve Bank of Philadelphia said on Thursday that its monthly manufacturing index fell for a second straight month to negative 16.4 - the lowest since April 2023...” Story at...
https://finance.yahoo.com/news/philly-feds-manufacturing-gauge-slumps-142634589.html
 
JOBLESS CLAIMS (Economic Times)
“Initial claims for state unemployment benefits dropped 22,000 to a seasonally adjusted 220,000 for the week ended Dec. 14, the Labor Department said on Thursday. Economists polled by Reuters had forecast 230,000 claims for the latest week.” Story at...
https://economictimes.indiatimes.com/news/international/world-news/us-weekly-jobless-claims-fall-more-than-expected/articleshow/116477281.cms?from=mdr
 
LEADING ECONOMIC INDEX (Conference Board via prnewswire)
"The US LEI rose in November for the first time since February 2022," said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. "A rebound in building permits, continued support from equities, improvement in average hours worked in manufacturing, and fewer initial unemployment claims boosted the LEI in November.” Press release at... 
https://www.prnewswire.com/news-releases/the-conference-board-leading-economic-index-lei-for-the-us-increased-in-november-302336250.html
 
MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Thursday the S&P 500 fell about 0.1% to 5867.
-VIX declined about 13% to 24.09.
-The yield on the 10-year Treasury rose (compared to about this time, prior trading day) to 4.550%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20.
 
SSO – sold 12/17. (IRA acct.)
SPY – sold 12/17. (IRA acct.)
QLD – sold 12/17. (IRA acct.)
UWM – sold 12/17. (IRA acct.)
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 23 gave Bear-signs and 5 were Bullish. (Yesterday, there were 21 bear-signs and 6 bull-signs. I adjusted an indicator.) 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 -18 (18 more Bear indicators than Bull indicators).
 
TODAY’S COMMENT
Today’s Bull-Bear spread of -18 is bearish. The 10-dMA of the 50-Indicator Spread (purple line in the chart above) continued down today so that is a bearish signal. (I follow the 10-dMA for trading buy-signals and as an indicator for sell signals.)
 
We did see that both Bollinger Bands and the Overbought/Oversold ratio are oversold. Two indicators are not usually enough to suggest a bottom, but RSI is very close to oversold. I’d say “close enough.”  
 
Thursday, the S&P 500 tested its low from yesterday.  Volumes were lower and some internals improved and some didn’t, so I can’t call a bottom with confidence. Small pullbacks give small bottom-signals so it’s possible that Friday will be an end to the weakness.
 
I suspect that the declines are over or nearly over. Let’s see what the markets do Friday.  Mr. Market may tell us the bottom is in.  
 
If declines do continue, here are some support levels where declines may end:
100-dMA – S&P 500, 5743
October lows: S&P 500, 5700
200-dMA: about S&P 500, 5520
 
BOTTOM LINE
The weakness appears to be over, or close to over, but Futures are down as I write this so I may be wrong.
 
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
 
THURSDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals remained SELL. (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 50% stocks, including stock mutual funds and ETFs. 50% invested in stocks is a normal position. (75% is my max stock allocation when I am confident that markets will continue higher; 30% in stocks is my Bear market position.)
 
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.