Navigate the Stock Market: 2025

Friday, March 28, 2025

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

My competition...

TODAY’S COMMENT
Breadth crashed today and down goes Frazier, down goes Frazier...no, but the indicators fell as fast as Frazier. The daily, bull-bear spread of 50-indicators fell sharply and turned bearish at -12 (12 more Bear indicators than Bull indicators). I can’t recall ever seeing such a big reversal in my indicators, although the 10-dMA of the spread is still moving higher - bullish sign.

Looks like investors made up their minds. A retest of the low of 5522 looks likely now. That is only about a 1% decline from today’s close. As of today, the drop from the all-time high is 9.2%.

We won’t know anything until the S&P 500 retests the old low. When it does, we may have a better idea whether there will be more downside.

BOTTOM LINE
I am neutral.

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 fell to 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.

Thursday, March 27, 2025

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

“Top national security officials for President Donald Trump, including his defense secretary, texted war plans for upcoming military strikes in Yemen to a group chat in a secure messaging app that included the editor-in-chief for The Atlantic, the magazine reported in a story posted online Monday.” – WAVY TV, Norfolk, VA.

“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.

GDP (WSJ)
“Gross domestic product grew at a slightly faster pace in the last three months of 2024 than previously estimated, the Commerce Department said Thursday. Commerce revised up its fourth-quarter GDP growth figure to a 2.4% annualized pace, from a previous estimate of 2.3%. That followed growth of 3.1% in the third quarter.” Story at...
https://www.wsj.com/economy/u-s-fourth-quarter-gdp-revised-higher-caaf0ca6

JOBLESS CLAIMS (CNN)
“Initial claims for unemployment benefits aren’t spiking — in fact, they’re mostly unchanged from last week. There were an estimated 224,000 initial claims for jobless benefits for the week ended March 22, a decline of 1,000 from the prior week’s upwardly revised tally.” Story at...
https://www.cnn.com/2025/03/27/economy/us-jobless-claims-doge-federal-applications/index.html

MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Thursday the S&P 500 declined about 0.33% to 5693.
-VIX rose about 2% to 18.69.
-The yield on the 10-year Treasury rose to 4.361% (compared to about this time prior market day).

MY TRADING POSITIONS:
SSO added 3/24/2025 SOLD 3/25/2025 (Decided to reduce risk and buy SPY instead.)

XLK added 3/24/2025
SPY added 3/25/2025

CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 7 gave Bear-signs and 13 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.)

TODAY’S COMMENT

Investors can’t seem to decide what to do recently; they couldn’t make up their minds today either.

Rinse and repeat.

The daily, bull-bear spread of 50-indicators declined, but remained Bullish at +6 (6 more Bull indicators than Bear indicators). The 10-dMA of the spread improved again – another bullish sign.

Repeating: Investors are still trying to decide how much slowing will be seen in the economy – Economists have the same question but there aren’t too many answers. Are markets going to re-test the correction low or not? Unfortunately, I can make a good argument either way. On the bear side, we didn’t see a successful retest of the low. On the bull side, there have been some very strong, bullish momentum-indicators after the low. We’ll see...

BOTTOM LINE
I am cautiously bullish. Indicators suggest the correction is over, but I have my doubts.

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

My basket of Market Internals declined to HOLD. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges from the Index.)

Wednesday, March 26, 2025

Durable Goods ... Crude Inventories ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

“Combatting stupidity and domestic terrorism.” – Michael
Political Commentary from Michael Ramirez at...
https://michaelpramirez.com/index.html

“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.

"I was really the first Democrat to refuse to shut our government down, and my party was so desperate to pander to shut the government down. Absurd, absolutely absurd. Six months ago, we were lecturing the Republicans, ‘You can’t shut the government down.’ Now it’s, ‘Well, yeah, let’s do these things.’ It’s like that’s part of the problem, to pander, and they want to pander to the extreme parts of our party, to shut the government down. I said I will never burn the village down and claim that I’m saving it.” - Sen. John Fetterman, D-Penn.
My cmt: Fetterman was one of 10 Democrats who voted for the Bill.

DURABLE GOODS (Reuters)
“Orders for long-lasting U.S. manufactured goods unexpectedly rose in February as businesses rushed to avoid potential price increases from tariffs, likely boosting capital expenditure in the first quarter. But the report from the Commerce Department on Wednesday did not change economists' expectations that economic growth was slowing considerably in the first quarter...” Story at...
https://www.reuters.com/markets/us/us-core-capital-goods-orders-unexpectedly-drop-february-2025-03-26/

CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 3.3 million barrels from the previous week. At 433.6 million barrels, U.S. crude oil inventories are about 5% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf

MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Wednesday the S&P 500 fell about 1.1% to 5712.
-VIX rose about 7% to 18.33.
-The yield on the 10-year Treasury rose to 4.354% (compared to about this time prior market day).

MY TRADING POSITIONS:
SSO added 3/24/2025 SOLD 3/25/2025 (Decided to reduce risk and buy SPY instead.)

XLK added 3/24/2025
SPY added 3/25/2025

CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 6 gave Bear-signs and 14 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.)

TODAY’S COMMENT
The daily, bull-bear spread of 50-indicators declined, but remained Bullish at +8 (8 more Bull indicators than Bear indicators). The 10-dMA of the spread improved again – another bullish sign.

On the bear side, the S&P 500 dropped below its 200-dMA.

Investors are still trying to decide how much slowing will be seen in the economy – Economists have the same question but there aren’t too many answers. Are markets going to re-test the correction low or not? Unfortunately, I can make a good argument either way. On the bear side, we didn’t see a successful retest of the low. On the bull side, there have been some very strong, bullish momentum-indicators after the low. We’ll see...

BOTTOM LINE
I am cautiously bullish. Indicators suggest the correction is over, but I have my doubts.

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

My basket of Market Internals remained BUY. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges from the Index.)

Tuesday, March 25, 2025

Consumer Confidence ... New Home Sales .. Richmond FED Manufacturing ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

TODAY’S COMMENT
The daily, bull-bear spread of 50-indicators improved to a Bullish +10 (10 more Bull indicators than Bear indicators). The 10-dMA of the spread improved again – another bullish sign. Indicators are popping higher. The Index is 0.4% above its 200-dMA and has closed above the 200-day on consecutive days. That’s a good sign.

All the signs seem to suggest the correction is over and we have seen the lows. However, I am finding it hard to believe, given all the Trump tariff-talk, DOGE antics and real Russian collusion (Trump has taken the Russian side over the Ukrainians).

The S&P 500 has retraced 40% of its losses from the all-time high back on 19 February. That’s slightly above the 38% Fibonacci retracement level, but there are Fibonacci levels at 50% and 62% so the Fibonacci stuff has never appealed to me. The most likely retracement level before a return to the lows is around 50%; it is very possible that markets will retest the lows around 5520. Because of those concerns, I decided to sell my leveraged positions in SSO (2x S&P 500 ETF) for a small profit and swap it for a position in SPY (S&P 500 ETF). Leveraged positions are painful in any kind of downturn. I can always add SSO later.

BOTTOM LINE
I am cautiously bullish. Indicators suggest the correction is over, but I have my doubts.

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

My basket of Market Internals remained BUY. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges from the Index.)

Monday, March 24, 2025

National Activity Index ... 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, DEPORTATIONS (WSJ)
“Americans won’t miss the Venezuelan and MS-13 gang members dispatched by the Trump Administration to El Salvador on the weekend. Most of them are criminals who were in the U.S. illegally. But it’s still troubling to see U.S. officials appear to disdain the law in the name of upholding it.
President Trump ordered the deportation of nearly 300 alleged members of Venezuela’s Tren de Aragua gang, as well as several from MS-13, the ruthless Salvadoran gang. They were apparently deported without a hearing in an immigration court, much less a criminal conviction... The Administration invoked the Alien Enemies Act of 1798 to justify the deportations without need for due process. That law has rarely been used in U.S. history and not since World War II....“They’re not gonna stop us,” Tom Homan, Mr. Trump’s immigration czar, told Fox News on Monday. “We’re not stopping. I don’t care what the judges think, I don’t care what the left thinks, we’re coming.” Elon Musk threatened Judge Boasberg with impeachment, and the MAGA-sphere chanted that Mr. Trump should ignore the courts. Are we already arriving at a constitutional impasse when the Administration thinks it can ignore court orders?” – WSJ Editorial Board at...
https://www.wsj.com/opinion/trump-deportations-gang-members-james-boasberg-tom-homan-nayib-bukele-ms-13-tren-de-aragua-6e377106?mod=commentary_trendingnow_article_pos2

NATIONAL ACTIVITY INDEX (WSJ)
“The index’s three-month moving average by contrast increased to 0.03 in January from minus 0.13 in December. The CFNAI diffusion index—which captures how much the change in the monthly index is spread among the indicators over three months—similarly increased, reaching 0.10 from minus 0.07 a month earlier. Periods of economic expansion have historically been associated with values of the CFNAI diffusion index above minus 0.35.” Story at...
https://www.wsj.com/economy/u-s-economic-growth-falls-back-below-average-02120246

MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Monday the S&P 500 rose about 1.8% to 5768.
-VIX fell about 9% to 17.48.
-The yield on the 10-year Treasury rose to 4.338% (compared to about this time prior market day).

MY TRADING POSITIONS:
SSO added 3/24/2025
XLK added 3/24/2025

CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 6 gave Bear-signs and 13 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.)

TODAY’S COMMENT
The daily, bull-bear spread of 50-indicators improved to a Bullish +7 (7 more Bull indicators than Bear indicators). The 10-dMA of the spread improved again – another bullish sign. The spread was +9 around mid-day today, but breadth declined a little and flipped one of my breadth indicators back to the bear side.

The 50-Indicator Ensemble is suggesting the correction is over. There were other signs too. The low (so far) was on 13 March. The day after the bottom, there was a 90% up-volume day that finished on high momentum. The following day there was another high-volume day with 87% up-volume. Even though the 2^nd day dd not have strong momentum into the close, the two back-to-back days are a bullish sign.

Still, I am left with the problem that the S&P 500 may still need to retest the low. The low on 13 March (7 trading session ago) was on lower volume than the previous low, but market internals didn’t improve appreciably. That suggests that a retrace to the 5525 level is still possible and I think it will re-test the lows; but I am following the indicators, not what I think. I am cautiously bullish.

Monday 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.

BOTTOM LINE
I moved to a 50% invested position today, 24 March. Investors are more bullish and that has pushed indicators to the bullish side.

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

DOW STOCKS - TODAY’S MOMENTUM RANKING OF THE DOW 30 STOCKS (Ranked Daily)

MONDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals reversed to BUY. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges from the Index.)

Time to Add to Stock Positions

The Bull minus Bear Indicator spread improved a lot today – up from -4 to +9 on a preliminary, mid-day basis. The S&P 500 looks like it will close above our line in the sand, the recent high at 5675, and Breadth was up across the board.

I am adding to stock positions so that my stock positions will make up 40 or 50% of the total portfolio. 50% is a fully-invested position for me, although I am frequently invested at a higher stock percentage when conditions look good. Now there are enough questions that I will not go all in.

We could still see a retest of the low of 5521 (7-days ago). Even moderate corrections can take a long time to fully resolve. In 2018 we had a 10% correction that retested the low over a month later. For now, there are enough positive signs to support being fully-invested.

Friday, March 21, 2025

Leading Economic Indicators ... Philly Fed ... Jobless Claims ... Existing Home Sales ... 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.

TARIFF FLEXIBILITY (CNBC)
“’I don’t change. But the word flexibility is an important word,” he [Trump] said. ‘Sometimes it’s flexibility. So there’ll be flexibility, but basically it’s reciprocal’...Trump and his officials say the plan will effectively assign tariff rates to all countries that have their own tariffs on U.S. goods. Countries with other non-tariff trade policies that the Trump administration opposes, such as value-added taxes, could also be subject to new duties.” Story at...
Https://www.cnbc.com/2025/03/21/trump-says-therell-be-flexibility-on-reciprocal-tariffs.html

PHILLY FED (RTT News)
“ A report released by the Federal Reserve Bank of Philadelphia on Thursday said regional manufacturing activity expanded overall but was less widespread in the month of March. The Philly Fed said its diffusion index for current general activity slid to 12.5 in March after plunging to 18.1 in February, although a positive reading still indicates growth. Economists had expected the index to slump to 8.5.” Story at...
https://www.nasdaq.com/articles/philly-fed-index-drops-less-expected-march

JOBLESS CLAIMS
U.S. jobless claims filings rose by 2,000 to 223,000 for the week ending March 15, the Labor Department said Thursday. That’s just less than the 224,000 new applications analysts forecast... U.S. jobless claims filings rose by 2,000 to 223,000 for the week ending March 15, the Labor Department said Thursday. That’s just less than the 224,000 new applications analysts forecast.” Story at...
https://apnews.com/article/unemployment-benefits-jobless-claims-layoffs-labor-571954a7ed9bd2966ada9360ea8ad83f

EXISTING HOME SALES (NA)
“Total existing-home sales – completed transactions that include single-family homes, townhomes, condominiums and co-ops – progressed 4.2% from January to a seasonally adjusted annual rate of 4.26 million in February. Year-over-year, sales slid 1.2% (down from 4.31 million in February 2024). ‘Home buyers are slowly entering the market,’ said NAR Chief Economist Lawrence Yun. ‘Mortgage rates have not changed much, but more inventory and choices are releasing pent-up housing demand.’” Story at...
https://www.nar.realtor/newsroom/existing-home-sales-accelerated-4-2-in-february

LEADING ECONOMIC INDEX (Conference Board)
“The US LEI fell again in February and continues to point to headwinds ahead,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Consumers’ expectations of future business conditions turned more pessimistic. That was the component that weighed down most heavily on the Index in February... the LEI’s six-month and annual growth rates, while still negative, have remained on an upward trend since the end of 2023...we currently forecast that real GDP growth in the US will slow to around 2.0% in 2025.” Press release at...
https://www.conference-board.org/topics/us-leading-indicators

MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Friday the S&P 500 rose about 0.1% to 5668.
-VIX fell about 3% to 19.28.
-The yield on the 10-year Treasury was little changed at 4.245% (compared to about this time prior market day).

MY TRADING POSITIONS:
None

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.)

TODAY’S COMMENT
Currently, the weakness has lasted 22 sessions; the S&P 500 currently has a 7.8% drop from the top and the Index is 1.4% below its 200-dMA. While the S&P 500 finished up slightly today, internals were weak – decliners outpaced advancers by nearly 2 to 1 as did down-volume vs up volume. New-highs had been improving, but they were outpaced by new-lows by almost 4 to 1.

The President’s “flexibility” comment (see above) boosted markets late in the day (according to the pundits). Perhaps, but that doesn’t seem different than what we have seen – a lot of negotiation and tariff delays. We already had flexibility, so it’s hard to feel confident that investors are suddenly ok with tariffs.

The daily, bull-bear spread of 50-indicators remained Neutral, but declined to -4 (4 more Bear indicators than Bull indicators). The 10-dMA of the spread improved again – a bullish sign.

The S&P 500 has not yet managed to break out of its double-top at 5675. Investors seem confused and today’s unchanged volume would confirm that assessment – it was very high.

I’m still waiting for investors to make up their minds about the market – should I stay or should I go?

As I suggested previously, I think a close above 5675 should probably be bought. If it appears a close above 5675 is in the cards, I would add to stock holdings, but not go all in. I might boost stock holdings to around 40-50%. A retrace to the 5525 level is still possible.

BOTTOM LINE
No bottom call yet. I am Neutral on the market with a very conservative allocation of only about 30% invested in stock holdings. 30% may be too conservative and I will add to stocks as noted above.

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

My basket of Market Internals reversed to 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 30% stocks, including stock mutual funds and ETFs – extreme bearish. (I’ll need to recalculate the %.) 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.

Thursday, March 20, 2025

Stock Market Analysis - Quick Update

It’s been a busy day so I’ll just do a quick update...

No change from yesterday: On Thursday, of the 50-Indicators I track, 11 gave Bear-signs and 9 were Bullish. The rest are neutral.

The daily, bull-bear spread of 50-indicators remained Neutral, at -2 (2 more Bear indicators than Bull indicators). The 10-dMA of the spread improved again – a bullish sign.

I don’t see a bottom yet, although as we noted before there have been weak bottom signals. Still, I’ll be on Hold until the S&P 500 closes above 5675 or I see a clear bottom signal.

Wednesday, March 19, 2025

Fed Rate Decision ... Crude Inventories ... Momentum Trading DOW Stocks & ETFs … Stock Market Analysis ...

I MAY NOT BE ABLE TO POST THURSDAY – IT’S A BUSY DAY.

“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.

“The trouble with trade wars is that once they begin they can quickly escalate and get out of control. All the more so when politicians are nearing an election campaign, as Canada now is. Or when Mr. Trump behaves as if his manhood is implicated because a foreign nation won’t take his nasty border taxes lying down. We said from the beginning that this North American trade war is the dumbest in history, and we were being kind.” – WSJ Editorial Board.

FED RATE (CNN)
“The Federal Reserve on Wednesday kept interest rates unchanged... Officials still expect to trim borrowing costs twice this year, according to their latest economic projections released Wednesday, though eight officials are predicting one or no cuts this year, compared to only four who expected that in December... Fed policymakers also expect the economy to be weaker this year than previously thought, according to the projections. They also forecast inflation to be higher this year.” Story at...
https://www.cnn.com/2025/03/19/economy/fed-rate-decision-march/index.html

CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 1.7 million barrels from the previous week. At 437.0 million barrels, U.S. crude oil inventories are about 5% below the five year average for this time of year.” Report at...
https://ir.eia.gov/wpsr/wpsrsummary.pdf

MARKET REPORT / ANALYSIS AS OF 1PM FRIDAY
-Wednesday the S&P 500 rose about 1.1% to 5675.
-VIX fell about 8% to 19.9.
-The yield on the 10-year Treasury declined to 4.246% (compared to about this time prior market day).

MY TRADING POSITIONS:
None

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.)

TODAY’S COMMENT
I wrote yesterday that I hoped the market would make a lower-low Wednesday so I could get a clearer idea of where the markets are headed. I didn’t want to see the S&P 500 close above its recent high of 5675. Well, it didn’t, but it came as close as possible. Today, the S&P 500 closed at 5675 forming a small double-top formation.

The daily, bull-bear spread of 50-indicators remained Neutral, but improved to -2 (2 more Bear indicators than Bull indicators). The 10-dMA of the spread improved again – a bullish sign.

The Bull-Bear spread did change last night; the Sentiment numbers for the Rydex/Guggenheim Bull/Bear analysis never made it to the bear threshold. Sentiment turned sharply bullish on Tuesday at the close. The final spread yesterday was -4. (Both final volume and Sentiment numbers are not available until late in the evening.)

The S&P 500 is back to its 25% retracement level, slightly more than the 23.6% first Fibonacci retracement value, for those who believe in that sort of thing. The Index closed 1.2% below its 200-dMA Wednesday.

Where do markets go from here? The analysis is mixed: price action appears bullish; indicators are mostly neutral, but the 10-dMA is bullish; we got a weak, Buy-signal on 6 March when the S&P 500 was 5739. The S&P 500 is at a critical double-top; as I suggested previously, I think a close above 5675 should probably be bought. If it appears a close above 5675 is in the cards, I would add to stock holdings, but not go all in. I might boost stock holdings to around 40-50%. A retrace to the 5525 level is still possible.

BOTTOM LINE
No bottom call yet, but we may not get one this time around. Given the indicator improvement I am Neutral on the market with a very conservative allocation of only about 30% invested in stock holdings. 30% may be too conservative given the recent price action and I will add to stocks as noted above...when I get the chance (maybe Friday).

ETF - MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs (Ranked Daily) ETF ranking follows:

My basket of Market Internals improved to BUY. (My basket of Market Internals is a decent trend-following analysis that is most useful when it diverges from the Index.)