Posted Thursday, March 19, 2009 @ 12:04 am by Dr. Wish

Buying Nicolas Darvas type stocks; New QQQQ short term up-trend

GMI

2/6

GMI-R

5/10

What is the GMI?
 

WORDEN T2108

45%

My short term indicators are coming back, although we are not out of the woods yet.  The GMI is now at 2 and the more sensitive GMI-R is at 5 (of 10).  The QQQQ short term down-trend ended after 21 days, and an up-trend has begun.  However, there were only 11 new highs and 17 new lows in my universe of 4,000 stocks on Wednesday. When the QQQQ is in a short term up-trend, I buy QLD (the Ultra long Nasdaq100 ETF)  and look for growth stocks.

Some of the stocks I have written about have came back to life, including TSYS, AMZN and NFLX.  I own some of these.  I ran my “Darvas” TC2007 scan, looking for stocks that would  meet the criteria that he used to select growth stocks.  Among the 11 Darvas stocks in my 4,000 stock universe are six that have also been on the IBD100 lists during the past year:  NFLX, SNDA, GMCR, QSII, LINC and SXL.  I especially like NFLX, GMCR and QSII because they are close to their all-time highs, which was a major requirement used by Darvas when he traded his way to two million dollars during a 2 year period in the late 50′s.  There is no guarantee that these stocks will do well, but I like to make pilot buys in such stocks, put in a stop loss, and then let the market tell me which, if any, will be winners. I then slowly buy more of the winners. To do well in the market, one has to keep the many losses small and pile into the few big winners.


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Comments ( 7 )

So then have you turned bullish on this manipultated rally built on false political hopes ” that all is well ” , “don’t worry be happy” and lastly B.O. ‘s comment to “buy stocks” . I still think run for your lives is in order.

Bill added these pithy words on Fri, 3-20-09 at 5:41 am

I read what the market is telling me, not what the pundits say and what the news may be.

Dr. Wish added these pithy words on Fri, 3-20-09 at 6:39 am

Mr. Wish, you have a good policy. I also don’t follow what the pundits say; not even what you say! Ten days ago you were going short, but the market kept rallying for 5 consecutive days(check your posts). I stayed with it and made money. Had I followed your “clues”, I’d have missed on this big rally going on. I read you just to see what the pundits say and, respectfully, you are also a pundit without a crystal ball! BTW, I don’t believe you made over 1000% profit in your IRA! LOL

Mosley added these pithy words on Fri, 3-20-09 at 11:29 am

I appreciate your comments. I have been in cash in my university pension for months and mainly so in my trading IRA. I often get whipsawed in my trading IRA during short term changes in trend but make small bets. I always catch the long term trend and go in with all of my funds. That is how I have multiplied my IRA 12x.

Dr. Wish added these pithy words on Fri, 3-20-09 at 4:41 pm

Most contributors of commentary on this site seem to be well informed, savvy traders, primarily interested in short term opportunities. Would be interested in your analysis of intermediate and long term vs. short term trends, accompanied by your definition of each. As an example, in your analysis of whether the market gains the past two weeks are the result of a bear market rally, or instead portend a sustained upward trend to continue for many months. My guess is that the number of stock market-illiterate, financially devastated baby boomers willing to pay for fact-based analysis of intermediate/long term trends is equal to or greater than the number of short term traders who tend to comment on this site more regularly.

Kent added these pithy words on Sun, 3-22-09 at 2:37 pm

Dr. Wish, I have a question for you. I’m wondering if chart indicators for Mutual Funds can be read the same way (or similarly) to regular stocks. GGT has caught my attention, and if it were the stock for a company, I would be very excited about what I think it’s about to do. But I don’t know if I can use my indicators (particularly 30 and 15 day/wk MAs and volume) the same way here. Thanks!

Liz added these pithy words on Tue, 9-15-09 at 6:23 pm

Thanks for your information. Most of the posts in the blog is really valuable.

Stocks to Buy added these pithy words on Sat, 7-2-11 at 4:42 am

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