GMI: +4; U-1; Looking for longs

The GMI rose to +4 on Friday. The IBD growth mutual fund index is now above its 200 day average and closing in on its key 50 day average. Gmi0630 When these mutual fund managers make money in growth stocks, the odds are good that I can. There were 137 new yearly highs in my universe of nearly 4,000 stocks on Friday.  Friday was the first day in the new QQQQ up-trend (U-1).  The IBD 100 stocks are also coming back.  76% closed above their 30 day averages and 90% are above their MACD signal lines. Ibd0630  29% of the stocks on the IBD 100 list from 5/15 are now higher than they closed on that day. Eight of them hit a new high on Friday:  IBCA, CLDN, LVS, XPRSA, GRMN, HOC, OII, EXPD (I own some of these)……

I am slowly wading into the market on the long side.  It remains to be seen whether this rally will hold.

Please send your comments to:  ewish@comcast.net.

GMI: +1; Too early to tell; 6 IBD 100 new highs

The GMI rose to +1, but it is too early to tell if this reversal will hold. Two other indicators are too close to call (?).  Next week should provide more clarity, after end of quarter window dressing is over and new earnings are anticipated.  96-100% of stocks in the QQQQ, SPY and DIA indexes rose on Thursday.  There were 96 new highs and 48 new lows in my universe of nearly 4,000 stocks.  Gmi0629 There were 6 new highs in the IBD 100 list from 5/15:  GRMN, EXPD, LVS, CLDN, LIFC, OII.  If this turn is for real, these stocks may be among the new leaders.

Please send your comments to:  ewish@comcast.net.

GMI: 0; Minimal changes

The GMI remains at zero.  Wednesday was the 34th day in the current QQQQ down-trend. Gmi0628

GMI:0; 5 Rockets, 433 Submarines; Watch your cash balances

The GMI is still zero.  Between 10-13% of the stocks in the Nasdaq 100, S&P 500 and Dow 30 indexes rose on Tuesday.  There were 28 new highs and 149 new lows in my universe of nearly 4,000 stocks.  Gmi0627_1 None of the GMI-S (short term) indicators are now positive.  A scan of my universe of stocks yielded 5 Rockets and 433 Submarines.  Thus, finding good shorts is 80x more likely than finding possible longs.  Tuesday was the 33rd day in the QQQQ down-trend. The IBD 100 stocks did as badly as my universe of stocks.  Ibd0627 There were only 2 highs among the IBD 100 stocks listed on 5/15.  Only 16 of them closed higher on Tuesday than where they closed on 5/15 when the list was published….. 

This is a good time to be short or in cash.  As I noted a few weeks ago,make sure your cash balances are swept into a high yielding money market fund.  Fidelity brokerage IRA accounts automatically are swept into the Cash Reserves fund paying almost 5%, but many of the other deep discount brokers pay their customers minimal interest while they invest your funds at much higher interest rates for themselves.  I have been told that some of these brokers will let you manually transfer your funds to a better paying fund, if you are smart enough to ask for it…..

Please send your comments to:  ewish@comcast.net.

GMI: 0; 3 IBD 100 new highs; New ETF’s to short indexes–a bullish sign?

The GMI remains at zero, but there were almost enough successful  new highs from 10 days ago (9/15= 60%) to turn this indicator positive.  While I typically call this index positive when 50% or more of the stocks that hit a new high 10 days ago close higher then they did 10 days ago, the numbers here are too small to do so. If it is above 50% again tomorrow, I will make the indicator positive.  Gmi0626 There were 36 new highs and 95 new lows in my universe of nearly 4,000 stocks.  65% of the Nasdaq 100 stocks advanced on Monday, along with 74% of the S&P 500 and 80% of the Dow 30 stocks. Monday was the 32nd day of the current QQQQ down-trend. 14% of the stocks in my universe are in an up-trend, compared with just 9% at the lows last week.  So stocks are getting stronger.

The IBD 100 growth stocks from 5/15 now look as strong as the stocks in my universe.  This contrasts with the way they acted during the recent decline, when they greatly underperformed other stocks.  Traders and funds were clearly unloading the premier growth stocks in the IBD 100 list.  Ibd0626Three IBD 100 stocks did hit a new high on Monday:  XPRSA, CLDN, OII.  Any of the IBD 100 stocks that could survive the decline of the past month and go on quickly to hit a new high is a stock worth watching.  69% of the IBD 100 stocks from 5/15 have a MACD above their signal lines, indicating growing strength.   Still, note that only 18 of these 100 stocks closed higher on Tuesday than they did on 5/15 when this list was published by IBD…….

There are now new ways for an investor/trader to short the major market indexes in an IRA without buying put options.  Inverse ETF’s have been born.  They move in the opposite direction of the indexes they track.  So, to short the Nasdaq 100 (QQQQ) index, one can buy  PSQ.  Other inverse ETF’s include:  SH (S&P 500); DOW 30 (DOG) MYY (S&P 400 midcap).  These ETF’s are thinly traded and should be researched carefully before buying. 

Maybe the dawn of a new set of inverse ETF’s is a bullish sign.  Typically, not long after investors are so interested in a sector that a relevant new ETF is issued, that sector is close to a top–check out XHB, GLD and SLV for recent examples.  Too many people may be interested in shorting the major indexes??!!  A new contrary indicator?

Please send your comments to:  ewish@comcast.net.

GMI: 0; minimal changes; D-31

GMI is still at zero.  Gmi0623 On Friday there were 24 new highs and 143 new lows in my universe of nearly 4,000 stocks.  33-50% of the stocks in the QQQQ, SPY and DIA advanced.  Indicators are off of their lowest levels of the past few weeks.  Friday was the 31st day (D-31) of the current QQQQ down-trend.  We have completed 7 weeks with the QQQQ below its 10 week average.  It will take some time for the trend to reverse.  I remain mainly in cash with a few put options in my IRA.

Please send your comments to:  ewish@comcast.net.

GMI: 0 Wed and Thurs.

Taking a little break.  The GMI has been zero on Wednesday and Thursday.  QQQQ is in 30th day of down-trend.  Still mainly in cash. 

GMI: 0; Minimal Changes

The GMI is still at zero.  Gmi0620 There were 18 new highs and 139 new lows in my universe of nearly 4,000 stocks.  50% of the Nasdaq 100 stocks advanced Tuesday, along with 42% of the S&P 500 and 68% of the Dow 30 stocks.  Changes were minimal in any of my other indicators and I am not presenting them.  This market is consolidating before it moves again.  Tuesday was the 28th day in the current QQQQ down-trend.

GMI:0; Few changes

The GMI remains at zero with few changes in my indicators.  Gmi0619 Only 18 new highs and 117 new lows in my universe of 4,000 stocks.  Only 18-20% of stocks in the QQQQ, SPY and DIA advanced on Monday.  Only 9% of stocks are in a short term up-trend and only 19% of the Nasdaq 100 stocks closed above their 30 day averages.  Monday was the 27th day in the QQQQ down-trend……

This is a time for me to remain in cash or in puts as the market remains in a down-trend.Ibd0619 

Please send your comments to:  ewish@comcast.net.

GMI: 0; Unbiased performance of the IBD 100 stocks; Cash and puts

The GMI starts the new week at zero.  Gmi0616On Friday, 30% of the Nasdaq 100 stocks advanced, along with 28% of the S&P 500 stocks and 50% of the Dow 30 stocks.  There were 25 new highs and 52 new lows in my universe of nearly 4,000 stocks.  Only 9% of stocks are in a short term up-trend and 20% closed above their 10 week averages.  Friday was the 26th day in the current QQQQ down-trend.

There were small changes in the IBD 100 stocks as of 5/15.  If you had bought one of these stocks when they were posted on 5/15 and held it through Friday, Ibd0616 you had an 8/100 chance of having a profit.  Only one of the 100 stocks hit a new high on Friday—GYMB……..

In today’s edition, IBD mentions in one place that VOL is being added to the IBD 100 list.  And then in another part of the paper, VOL is listed in a table as the top gainer in the IBD 100 stocks.  Maybe I am cynical, but I think this is misleading.  By deleting the poor performers each week and replacing them with new winners the IBD 100 stock list can always look great.  That is why I track in the table above a list of the IBD 100 stocks as of a specified date (currently 5/15) for several months.  This approach provides a better estimate of the performance of the IBD 100 stocks over time.

It is too early to tell whether the current rally is just a pause in the down-trend or the beginning of a new up-trend.  I remain in cash and in put options.

Please send your comments to:  ewish@comcast.net.



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