22 States Already in Recession... 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), May 2025.
 
CASS FREIGHT (CASS Information Systems)
“Just as we correctly expected tariff reprieves to support a recovery in September volumes, we also expect tariffs to result in volume declines and additional softness as price increases reduce affordability and impact spending.
-After rising 13% in 2021 and 0.6% in 2022, the index declined 5.5% in 2023 and 4.1% in 2024, and is trending toward another considerable decline in 2025.
-In October, the shipments component of the Cass Freight Index would decline 6% y/y on the normal seasonal pattern.”
 

Report at... 
https://www.cassinfo.com/freight-audit-payment/cass-transportation-indexes/september-2025
 
22 STATES ALREADY IN RECESSION (Moneywise)
“...in a recent MarketWatch report, Mark Zandi, chief economist at Moody’s Analytics, said 22 of America’s 50 states — including the District of Columbia — are already in a recession, and if certain states start experiencing their own declines in growth, it could tip the entire country into a broad economic slump.” Story at...
Economist Mark Zandi says these 22 states have slipped into recession based on 2 clear indicators — could the ripple effects hit your wallet next?
 
MARKET REPORT / ANALYSIS
-Wednesday the S&P 500 declined about 0.5% to 6699.
-VIX rose about 4% to 18.6.
-The yield on the 10-year Treasury declined to 3.953% (compared to about this time prior market day).
 
MY TRADING POSITIONS:
SPY – Added 8/26/2025
XLK – Added 8/26/2025
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
Today, of the 50-Indicators I track, 7 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 declined from +9 to +5 (9 more Bull indicators than Bear indicators), a Neutral indication. I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread smooths daily fluctuations; it continued higher, a Bullish sign.
 
Conditions were worse earlier in the day. Although the indicator spread was still neutral the 10-dMA of spread was headed down. Breadth improved later in the day and several indicators improved as a result.
 
While the S&P 500 is close to its lower trendline, it is less than 1% from another all-time high.
 
The S&P 500 is 10.2% greater than its 200-dMA. The 10-15% zone is where we often see weakness in the markets so it is hard to say whether we’ll see much of a fall rally that the pundits are talking about on CNBC. My guess is that we will, but the odds aren’t as good as we’d like.
 
Wednesday, we note that Unchanged volume is high, a sign of confusion that some believe precedes a change in market direction. Unchanged Volume has been high a lot over the last month. I’ve never included this in my indicators since it is wrong much more than right.
 
As I noted yesterday, it looks like the market is improving beneath the surface of the major indices. I’ll run the numbers around mid-day Thursday and decide whether to add to stocks.
 
BOTTOM LINE
I’m Bullish/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
 
WEDNESDAY MARKET INTERNALS (NYSE DATA)

My basket of Market Internals remained Neutral. (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, 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.