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

 

Internet has been spotty. I’ve gotten all the data through the phone, but posting hasn’t been possible. The following is based on Friday’s data.
 
I’ll continue posting late next week. It’s a busy time.
 
“Trade what you see; not what you think.” – The Old Fool, Richard McCranie, trader extraordinaire

Michael Ramirez, Political commentary at... https://michaelpramirez.com/index.html

 

“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).
 
HERITAGE CAPITAL BLOG (Heritage Capital)
“As I wrote the other day, new highs have been expanding... The NDX...is but a day from new highs. I cannot believe the only pullback we will see has already been seen this week. That seems too little, but would indicate a possible surge to the upside if this goes on much longer. That is not my base case.” – Paul Schatz, President Heritage Capital.
https://investfortomorrow.com/blog/nasdaq-100-leading-like-a-champ/
 
JOBLESS CLAIMS (Reuters)
“The number of Americans filing new applications for jobless benefits unexpectedly fell last week, suggesting employers may be holding on to workers despite other indications of a cooling labor market. Initial claims for state unemployment benefits dropped 5,000 to a seasonally adjusted 227,000 for the week ended July 4...” Sory at...
https://www.reuters.com/world/us/us-weekly-jobless-claims-fall-unexpectedly-latest-week-2025-07-10/
 
MARKET REPORT / ANALYSIS
-Friday the S&P 500 declined about 0.3% to 6260.
-VIX rose about 4% to 16.40.
-The yield on the 10-year Treasury rose to 4.417% (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, 11 gave Bear-signs and 12 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 remained in a Neutral position at +1 (1 more Bull indicators than Bear indicators). I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread reversed down – a bearish sign.
 
Ruh-roh. Houston, we have a problem...maybe. The 10-dMA of spread is now falling and that is not a good sign. It usually signals a drop, but that drop might be small (a few precent) or large (use your imagination). The good news (sort-of) is that breadth was decent at the recent all-time high (last Thursday) and so were new-highs. That has limited corrections to 10% or less in the past.   
 
I don’t have a very good crystal ball for short-term calls, but we can watch the lower trendline.  The S&P 500 closed at the lower trendline Friday.  If that support level fails significantly, then we can suspect a correction is likely. The key word is “significantly.” What the heck does that mean? Some say that any break below the trendline is significant. I prefer different signals. There are a couple of tells for significant breaks in trend: (1) Two successive closes below the trend line (2) a break 3% below the trendline. Either, but not both, are good enough for me.
 
BOTTOM LINE
I am neutral. We are watching the S&P 500 and the lower trendline.
 
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 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 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.