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GMI: 3; GMI-R: 4; on critical support–very cautious

My indicators have weakened and the indexes are sitting directly on support.  We should know in the next few days whether this bounce that began in mid-July will hold.  I am mainly in cash and will wait for the outcome.  Many stocks have broken down recently and in the last six days there have been only 6 to 23 daily new highs in my universe of 4,000 stocks.  This is not a market to profit from buying stocks at new highs.

GMI: 3; GMI-R: 5; 13th day of QQQQ up-trend; bottom in?

The GMI remains at 3 (of 6) and the GMI-R at 5 (of 10).  There were 23 new highs and 31 new lows in my universe of 4,000 stocks on  Friday. Gmi0825

The Worden T2108 indicator is now at 53%, in neutral territory.  It appears to me that the QQQQ, SPY and DIA have all successfully tested short term support.  The QQQQ has closed above its critical 10 week average for three weeks.  A lot of stocks appear to me to be finding support.  So, I am inclined to nibble at QLD again and to look for stocks breaking to new highs.  I remain heavily in cash and will slowly wade into this market if stocks strengthen. 

GMI: 3; GMI-R: 5; 12th day of QQQQ up-trend; still cautious

One of my readers questioned my last post.  How can I be in cash or short when the QQQQ is in an up-trend, now in its 12th day?  Well, for one thing, many of the stocks with break-outs have been failing.  Also, one of the GMI components measures whether the IBD growth mutual fund index is above its 50 day average.  Well, this index has been below its 50 day average since mid-June, and I have never consistently made money trading growth stocks when this indicator is negative.  Finally, instead of having the 100 new highs each day that are required by the GMI, we have been having only 10-14 the past few days.  If only 14 stocks out of 4,000 can hit a new high each day, then  it is unlikely that stocks are strong.  So, the QQQQ remains in an up-trend, but I am unwilling to trade the QLD right now.  I think it better to stay in cash for now. If the QQQQ up-trend strengthens, I may wade in again.

GMI: 3; GMI-R: 5; mainly in cash

The GMI fell to 3 (of 6) and the GMI-R to 5 (of 10).  There were 11 new highs and 146 new lows in my universe of 4,000 stocks on Tuesday.  With many failed break-outs, and more new lows than highs, this market looks treacherous on the long side.  Better to be in cash or a little short.

GMI: 4; GMI-R: 8; 8th day of QQQQ up-trend

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GMI: 4; GMI-R: 8; 7th day of QQQQ up-trend; buying QLD and DDM

The GMI remains at 4 (of 6) and the GMI-R at 8 (of 10).  There were 53 new highs and 47 new lows in my universe of 4,000 stocks on Thursday.  The Worden T2108 indicator is at 53%, in neutral territory.  As this up-trend develops, I am accumulating the ultra long QQQQ ETF, QLD, and the ultra long ETF for the Dow 30, DDM. Thursday was the 7th day of the current QQQQ up-trend.

GMI: 4; GMI-R: 8; 5th day of QQQQ up-trend

There were 58 new highs and 47 new lows in my universe of 4,000 stocks on Tuesday.  Since this new QQQQ up-trend began (by my definition) 5 days ago, the QQQQ has risen 2.5% and 74% of the Nasdaq 100 stocks have advanced; 22% rose by more than 5%.  The QLD has risen 5.2%.  Staying on the side of the market trend greatly enhances the probability of profitable trading. 

GMI: 5; GMI-R: 9; Day four of new QQQQ up-trend; buying QLD

The GMI is now 5 (of 6) and the GMI-R is 9 (of 10).  There were 134 new highs and 52 new lows in my universe of 4,000 stocks on Monday.  June 19 was the last time there were more than 100 new highs (102). Monday was the fourth day of the current QQQQ up-trend.  I am accumulating QLD and other stocks.

GMI: 4; GMI-R: 8; 3rd day of QQQQ up-trend

The GMI remains at 4 (of 6)  and the more sensitive GMI-R rose to 8 (of 10).  There were 80 new highs and 72 new lows in my universe of 4,000 stocks on  Friday.  The Worden T2108 indicator is now at 50%.  The QQQQ is back above its 10 week average and I am adding stocks and QLD.  Friday was the third day of the new QQQQ up-trend.  The prior down-trend lasted 39 days.

GMI: 4; GMI-R: 6; 2nd day of QQQQ up-trend; buying QLD

Thursday was the second day of the new QQQQ up-trend.  However, there were only 36 new highs and 81 new lows in my universe of 4,000 stocks on Thursday. Three fourths of the Nasdaq 100 and S&P 500 stocks had their MACD close above its signal line, a sign of a growing up-trend.  The QQQQ 10 day average is now above its 30 day average.  I am slowly buying some QLD. 



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