“Trade what you see; not what you think.” – The Old Fool,
Richard McCranie, trader extraordinaire.
“[Joe Biden] has been wrong on nearly every major foreign
policy and national security issue over the past four decades." – Robert Gates,
Secretary of Defense under the Obama Administration (Gates Memoir, Pub. Jan
2014).
My cmt: Now we have Afghanistan. It is in our National
Interest to keep the Taliban in check.
With US air support, the Taliban would have remained a non-threat even
without US troops on the ground. It’s a travesty that Biden didn’t listen to the
CIA and Defense Dept.
UNIV OF MICHIGAN SENTIMENT (CNBC)
“The consumer sentiment index tumbled to 70.2 in its
preliminary August reading. That is down more than 13% from July’s result of
81.2 and below the April 2020 mark of 71.8 that was lowest of the pandemic era.”
Story at...
MIKE LINDELL’S CYBER EXPERT SAYS HE CAN’T PROVE THE ELECTION WAS STOLEN (msn.news)
"Mike Lindell's cyber symposium might be about to take a turn for the worse since the investigative expert he hired apparently cannot confirm the MyPillow chief’s 2020 election conspiracy theories...In separate but somewhat related news, a federal judge ruled on Wednesday that Dominion Voting Systems can move ahead with the billion-dollar lawsuit they’ve been pursuing against Lindell and other Trump allies for defaming the company in their attempts to delegitimize the election.” Story at...
My cmt: This was reported by the Washington Times, a
conservative newspaper...another Trump claim refuted. The problem with the “Stolen Election”
scenario all along has been the lack of evidence.
TEXAS DEPLOYS OUT OF STATE MEDICAL WORKERS (CNBC)
“Hospitals in Texas are suspending elective procedures
and turning to 2,500 medical workers from other states to help combat a surge
in Covid cases as increasingly younger and healthier patients who didn’t get
vaccinated against the virus crowd treatment floors... the largest and the
highest increases that we’re seeing are the 18-to-49-year-olds, and a lot of these
people don’t have underlying illnesses.” Story at...
My cmt: While the media gloats that the dumb people in the
South are getting what they deserve, the experts predict that the Covid-Delta Variant
will work its way North in late summer/fall as numbers begin to drop in the
South.
CORONAVIRUS (NTSM)
Here’s the latest from the COVID19 Johns Hopkins website as
of 6:00 PM Friday. U.S. total case numbers are on the left axis; daily numbers
are on the right side of the graph in Red with the 10-dMA of daily numbers in
Green.
MARKET REPORT / ANALYSIS
-Friday the S&P 500 rose about 0.2% to 4468.
-VIX dropped about 1% to 15.45.
-The yield on the 10-year Treasury dropped to 1.286%.
Friday the Thirteenth. Today’s volume on the NYSE was 76% below the
monthly average. That’s not such a great
sign in an advancing market – are we running out of buyers? – but it’s not
really a good indicator. Investors seem worried, but perhaps that’s good as we
continue to climb the wall-of-worry.
Here’s Friday’s run-down of some important indicators.
These tend to be both long-term and short-term, so they are somewhat different
than the 20 that I report on daily.
BULL SIGNS
-The 10-dMA of issues advancing on the NYSE
(Breadth) is above 50%.
-The 50-dMA % of issues advancing on the NYSE (Breadth)
is above 50%.
-The 100-dMA of the % of issues advancing on the
NYSE (Breadth) is above 50%.
-The 5-10-20 Timer System is BUY; the 5-dEMA and 10-dEMA are
both above the 20-dEMA.
-MACD of S&P 500 price made a bullish crossover, 11
August.
-The Smart Money (late-day action). (This indicator is based
on the Smart Money Indicator developed by Don Hayes).
-McClellan Oscillator.
-The S&P 500 is out-performing the Utilities ETF
(XLU), not as much as I’d like, but I’ll leave it in the bull category for now.
-55% of the 15-ETFs that I track have been up over the
last 10-days.
-Slope of the 40-dMA of New-highs turned up today. Let’s
hope it continues higher. This is one of my favorite trend indicators.
-Cyclical Industrials (XLI-ETF) have been out-performing
the S&P 500 recently. Let’s hope that continues.
NEUTRAL
-Distribution Days.
-Bollinger Bands
-RSI.
-Statistically, the S&P 500 gave a panic-signal, 18
June, but the signal has expired.
-Non-crash Sentiment indicator remains neutral, but it is
very bullish and that means the signal is leaning bearish.
-5.1% of all issues traded on the NYSE made new, 52-week
highs when the S&P 500 made a new all-time-high today, 13 August. (There is
no bullish signal for this indicator.) This is below average, but not low
enough to send a bear signal – something to watch.
-The Fosback High-Low Logic Index is neutral.
-There have been 14 up-days over the last 20 days.
Neutral
-There have been 7 up-days over the last 10-days. Neutral
-The size of up-moves has been smaller than the size of
down-moves over the last month, but not enough to give a signal.
-VIX.
-Overbought/Oversold Index (Advance/Decline Ratio).
-29 July, the 52-week, New-high/new-low ratio improved by
0.4 standard deviations, somewhat bullish, but neutral.
-There have been 0 Statistically-Significant days in the
last 15-days. This can be a bull or bear signal. 0 is neutral.
BEAR SIGNS
-The smoothed advancing volume on the NYSE is falling.
-MACD of the percentage of issues advancing on the NYSE
(breadth) made a bearish crossover 10 August.
-The S&P 500 is 12.1% above its 200-dMA (Bear
indicator is 12%.). This value was 15.9% above the 200-dMA when the 10%
correction occurred in Sep 2020.
-Breadth on the NYSE compared to the S&P 500 index is
bearish.
-My Money Trend indicator.
-Long-term new-high/new-low data is falling.
-Short-term new-high/new-low data is falling.
On Friday, 21 February, 2 days after the top of the
Coronavirus pullback, there were 10 bear-signs and 1 bull-sign. Now there are 7
bear-signs and 11 bull-signs. Last week, there were 5 bear-signs and 10
bull-signs.
That’s not much different so it would appear that the slow
melt-up may continue, as long as the market isn’t overcome by news – Covid;
Afghanistan; China slowdown; take your pick.
The daily sum of 20 Indicators remained -4 (a positive
number is bullish; negatives are bearish); the 10-day smoothed sum that smooths
the daily fluctuations slipped from -26 to -29. (These numbers sometimes change
after I post the blog based on data that comes in late.) Most of these
indicators are short-term and many are trend following.
The Long Term NTSM indicator
remained HOLD. Volume, VIX, Price & Sentiment are neutral.
I remain cautiously bullish.
MOMENTUM ANALYSIS:
TODAY’S RANKING OF 15 ETFs
(Ranked Daily)
The top ranked ETF receives 100%. The rest are then ranked based on their momentum relative to the leading ETF.
TODAY’S RANKING OF THE DOW 30
STOCKS (Ranked Daily)
Here’s the revised DOW 30 and
its momentum analysis. 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
I sold American Express (AXP)
today. It has not performed well recently. I’ll look at my momentum analysis in
the Dow 30 and ETFs to determine a replacement.
FRIDAY MARKET INTERNALS (NYSE
DATA)
Market Internals remained NEUTRAL on the market.
Market Internals are a decent
trend-following analysis of current market action, but should not be used alone
for short term trading. They are usually right, but they are often late. They are most useful when they diverge from
the Index.
Using the Short-term indicator
in 2018 in SPY would have made a 5% gain instead of a 6% loss for buy-and-hold.
The methodology was Buy on a POSITIVE indication and Sell on a NEGATIVE
indication and stay out until the next POSITIVE indication. The back-test
included 13-buys and 13-sells, or a trade every 2-weeks on average.
My stock-allocation is about 50%
invested in stocks. I am not super bullish (or bearish) and I am watching the
markets closely.
You may wish to have a higher
or lower % invested in stocks depending on your risk tolerance. 50% is a
conservative position that I consider fully invested for most retirees. As a
retiree, 50% in the stock market is about fully invested for me – it is a
cautious and conservative number. If I feel very confident, I might go to 60%;
if a correction is deep enough, and I can call a bottom, 80% would not be out
of the question.
