CPI ... Crude Inventories ... 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.
 
CPI (CNBC)
“Inflation perked up more than anticipated in January, providing further incentive for the Federal Reserve to hold the line on interest rates. The consumer price index, a broad measure of costs in goods and services across the U.S. economy, accelerated a seasonally adjusted 0.5% for the month, putting the annual inflation rate at 3%...” Story at...
https://www.cnbc.com/2025/02/12/cpi-january-2025.html
 
CRUDE INVENTORIES (EIA)
“U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 4.1 million barrels from the previous week. At 427.9 million barrels, U.S. crude oil inventories are about 4% 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 declined about 0.3% to 6052.
-VIX declined about 0.8% to 15.89.
-The yield on the 10-year Treasury rose (compared to about this time, prior trading day) to 4.627%.
 
MY TRADING POSITIONS:
XLK – Holding since the October 2022 lows.  Added more 9/20/2024.
QLD – added 12/20/2024. (IRA acct.)
NVDA – added 1/6/2025.
 
The decline in Nvidia appears to be overblown. Regarding competition to Nvidia, Dan Ives (Managing Director and Senior Equity Research Analyst covering the Technology sector at Wedbush Securities) says, “The threat is minimal.” He recommended buying Nvidia. I will hold NVDA and see what develops... 
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 17 gave Bear-signs and 6 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 to a Bearish -11 (11 more Bear indicators than Bull indicators). The 10-dMA of the spread is still falling, a bearish sign.
 
Wednesday there was another bearish Hindenburg Omen. It’s valid because the McClellan Oscillator also turned down today.
Hindenburg Omen: (https://www.investopedia.com/terms/h/hindenburgomen.asp).
As we’ve noted before, the Omen sends a lot of false warnings. The short-term, Fosback New-high/new-low Logic indicator uses a similar analytic approach. It is not yet giving a bearish signal although it is elevated.
 
Breadth declined today and the 50-dMA of issues advancing on the NYSE has been below 50% for three consecutive days. That triggers a “bear now” warning, however, that’s probably an overblown signal.
 
The S&P 500 is 0.8% above its 50-dMA; if the index drops below the 50-day, selling could pick up. So far, investors don’t seem concerned - VIX went down today even though the S&P 500 was down.
 
The S&P 500 is only 1.1% below its all-time high just 3 weeks ago.   So far this “pullback” has been a sideways move.
 
The 50-dMA is an action point. So far, this appears to be an ordinary trip to the lower, trendline/50-dMA. If those support points are broken it suggests further declines, because indicators are quite negative.
 
BOTTOM LINE
I am still Neutral – 60% in stocks.
 
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
 
WEDNESDAY 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 60% 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.