Thursday, March 26, 2026

… 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.”
 
SEVERE MARKET DROP? (MarketWatch)
“Three factors that have preceded double-digit stock-market declines are all present in 2026…During those years, recession, military conflict and unexpected shifts in the Federal Reserve’s monetary policy were largely responsible for the steep declines, Colas said. Recession was the most frequent culprit, responsible for driving losses of 10% or greater in eight of the 12 examples.” Story at…
My cmt: The economy is not in recession and it would take extended high fuel prices to get there. Could it happen, sure, but I don’t see signs now.
 
S&P 500 WARNING SIGNS (Markets Insider)
“-The S&P 500's recent dip below its 200-day average hints at potential downside ahead.
-Lance Roberts of RIA Advisors suggests watching six technical indicators to assess market health.
-Roberts advises investors to trim large positions and hold cash to mitigate potential losses.” Story at…
 
 
QUICK MARKET SUMMARY
-Thursday the S&P 500 declined about 1.7% to 6477.
-VIX rose about 8% to 27.44.
-The yield on the 10-year Treasury rose to 4.412% (compared to about this time prior market day).
 
MY TRADING POSITIONS
SPY – Added 12/1/2025.
NVDA – Added 12/1/2025 & 2/6/2026
“Despite all the bearish noise, Goldman Sachs isn’t backing down on Nvidia (NVDA) stock yet. After another stellar GTC showing, the bank reiterated its $250 price target and maintained a buy rating, underscoring confidence in the AI giant’s tremendous upside from current levels.” Story at…  
 
CURRENT SUMMARY OF APPROXIMATELY 50 INDICATORS:
At the close today, of the 50-Indicators I track, 19 gave Bear-signs and 7 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
S&P 500 drop from the Top: 7.2%
S&P 500 % above 200-dMA: -2.4%
Trading Days since top: 51. (Avg top to bottom for corrections less than 10% = 32 days, but the 10% correction in Sept of 2023 lasted 64-days top to bottom.)
 
The daily, bull-bear spread of 50-indicators declined from -8 to -12 (12 more Bear indicators than Bull indicators), a BEARISH indication. I consider +5 to -5 the neutral zone. The 10-dMA curve of the spread (purple on the chart above) that smooths daily fluctuations continued higher – a BULLISH indication. The continued improvement of the 10-dMA is a good sign.
 
The 10-day is more important than the daily numbers since it shows an underlying improvement in the markets.
 Thursday, there was a technical, buy-signal. Volume was much lower than the prior panic low last week and we saw sufficient (but not great) improvement in the internals to call a “Buy.”
 
This presents a difficult question for investors.  Do we buy the signal? We need to recognize that the news can overcome technicals and the war is continuing. Further, there may be no way to end the conflict without invading Iran.  That will drive the markets down. For me, I would trade the low if there is confirmation tomorrow.  The confirmation we want to see is a strong up-day suggesting that other traders agree with us.
 
The chart looked ugly today and there is no guarantee that we’ll see buying tomorrow to confirm the technical, buy-signal.
 
Unfortunately, I am traveling and won’t be doing any trading Friday.
 
BOTTOM LINE
I am cautiously bullish.
 
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…
 
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…
 
THURSDAY 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 invested position is about 55% stocks, including stock mutual funds and ETFs. 50% invested in stocks is a normal, conservative position for a retiree. (80% 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 although I don’t trade as much as I used to. 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.
 
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