The GMI is back to 5. The SPY and DIA are weak. The Nasdaq 100 stocks are showing the most strength. It will be interesting to see whether AAPL follows RIMM’s lead next week.
Month: June 2007
GMI: 4; GMI-S: 31; GRMN and MR strong
The Nasdaq stocks really strengthened on Wednesday and that index is in its 60th day of an up-trend. 
There were 80 new highs but 92 new lows in my universe of 4,000 stocks. The Nasdaq 100 index is much stronger than the Dow and S&P 500 indexes. The GMI is back to a definite 4. My covered call positions are holding up, with the exception of the IOC debacle I wrote about yesterday. I bought back some of my IOC calls and sold the shares at a large loss. I probably will close out all of the shares and calls tomorrow.
GRMN continues to climb and I own some shares of this company. I think we are getting a rally based on anticipated good earnings to be released on August 1. I also own some MR, which is showing major strength.
See my disclaimers on the previous post.
GMI: 4? and on the edge; GMI-S: 13; IOC—YIKES!!!
The GMI is down to 4 and could fall to 2 tomorrow with another down day. The GMI-S is down to 13. 
There were only 56 new highs and 84 new lows in my universe of 4,000 stocks. Two indicators are too close to call (?), so I left them positive. Tuesday was the 59th day of the current QQQQ up-trend and it would not surprise me to see a new down-trend. The QQQQ has closed above its 10 week average for 12 weeks. The SPY is now below its 10 week average. The Worden T2108 indicator shows 34% of stocks above their 40 day average, far from the 80% peak in April, but not low enough to where declines typically end, around 25%. So, this decline could have more to go…..
I was bloodied by IOC on Tuesday. The stock fell 30% and evaporated many of the gains I had achieved by selling high premium calls on it the past two months. This was an important lesson about not being too greedy on such bets….
I still suspect we will have an earnings rally in July. The put/call ratio was over 1 on Tuesday, a bullish sign because options players are betting on a decline. However, if the GMI continues to weaken, I will go to cash and purchase QID or SDS to make money on the short side.
