Dallas 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.
 
"This is maybe the most dangerous market of my career, and that includes 1987's crash, that includes the savings and loan debacle market of the early '90s, that includes the 1999 to 2009 lost decade in the S&P 500 in the dot-com bubble. This is the most difficult market of my 45 years." -  Bill Smead, Smead Value Fund (SMVLX).
 
“In writing the conservative majority’s opinion that judges went too far when they blocked Trump’s changes to birthright citizenship from going into effect everywhere in the country, Justice Amy Coney Barrett had some strong words about Justice Ketanji Brown Jackson’s dissent. “We will not dwell on Justice Jackson’s argument, which is at odds with more than two centuries’ worth of precedent, not to mention the Constitution itself,” Barret wrote. “We observe only this: Justice Jackson decries an imperial Executive while embracing an imperial Judiciary.” Story at...
Don't like the Supreme Court's recent opinions? Chief Justice John Roberts has thoughts
My cmt: The Court didn’t rule on Birthright Citizenship – just that federal judges can’t block government policies for the entire country when a case is local.  
 
3 SIGNS THE ECONOMY IS WORSE THAN WE THOUGHT (Business Insider)
“...this week's third GDP estimate was worse than expected and the previous two estimates. The third estimate showed real GDP dropped at an annualized rate of 0.5% compared to a 0.2% expected drop and the 0.3% drop reported in the initial advance estimate on April 30... Consumer spending, which is crucial for GDP growth, cooled in the first quarter. It rose 0.5% compared to 4% in the last quarter of 2024... Real spending has weakened, dropping 0.3% in May from April, according to a BEA report out Friday morning. All told, spending growth has been largely flat since late last year.” Story at...
3      signs the economy is in worse shape than we thought
 
OUTLOOK IS FOGGED (The Street)
“While below initial expectations, this is still the highest level of tariffs the U.S. has had in nearly nine decades and, if maintained, will have substantial impact on the U.S. and global economies...we continue to expect interest rates higher for longer. As of this writing, we see the Federal Reserve cutting rates only once in 2025, with a year-end fed funds-rate target range of 4.00% to 4.25%. We believe that Fed Chairman Jerome Powell will likely take a conservative approach to easing policy to safeguard against fears of runaway inflation.
Top economist sends sobering tariff, interest rate forecast
 
DALLAS FED MANUFACTURING (Dallas FED)
“Texas factory activity was largely unchanged in June, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, held steady at 1.3, with the near-zero reading indicating a second month of flat output... Expectations for manufacturing activity six months from now remained positive.” Report at... 
https://www.dallasfed.org/research/surveys/tmos/2025/2506
 
MARKET REPORT / ANALYSIS
-Monday the S&P 500 rose about 0.5% to 6205.
-VIX rose about 3% to 16.73. (The Options Crowd was concerned about something.)
-The yield on the 10-year Treasury declined to 4.232% (compared to about this time prior market day).
 
MY TRADING POSITIONS:
SPY – added 6/5/2025 & 6/27/2025
XLK – added 6/27/2025
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 3 gave Bear-signs and 21 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 increased to a very bullish +18 from +15 last trading day (18 more Bull indicators than Bear indicators). I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread turned higher – a bullish sign. Indicators don’t get much better than this. Wooo-wooo!
- “Looking good, Billy Ray!  Feeling good, Louis!”
- “This is not the recession you are looking for. You can go about your business.  Move along.”
- “A toast to my big brother George, the richest man in town.”
 
The S&P 500 made another new, all-time-high today. Breadth looks good and it was above 50% for all time-frames I track, i.e. more than half of the issues on the NYSE were up over their respective time-frames.  The number of new-52-week highs were again below the 5-year average for what we typically see at all-time highs, but they were well above a number that signals trouble. There was more good news.
 
There were only 3 indicators giving bear signals: (1) Bollinger Bands (2) The S&P 500 is too far ahead of Breadth (3) S&P 500 is outperforming cyclical industrials (XLI)
 
#1 and #2 are top indicators.  The most important might be Bollinger Bands because it is closely followed.  Bollinger Bands are now overbought, but RSI is not. I use them together so no top warning yet. 
 
I measure Sentiment as a 5-day average of %-Bulls (Bulls/{bulls+bears}) based on the amounts invested in select Rydex/Guggenheim mutual funds. My sentiment value is now an extreme 95%-bulls. That’s high, but the sentiment indicator is not yet giving a sell signal. Markets can go higher. When we see more top-signals we may expect a 4-7% correction. I am not looking for a bear-market any time soon, but the news could always change my mind. There are a lot of issues that could present problems: tariffs, inflation, Trump, war, etc. For now, investors remain optimistic.
 
I increased stock holdings Friday, based on good signs from indicators, raising my investment in stocks to about 55% of the portfolio.
 
BOTTOM LINE
I am cautiously Bullish. Cautiously, because of tariffs and their impact on inflation.
 
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 BUY. (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 55% stocks, including stock mutual funds and ETFs. 50% invested in stocks is a normal, conservative position for a retiree. (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.