8th day of $QQQ short term down-trend

GMI

5/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

72%

Tech stocks, as measured by the QQQ short term, are still lagging.  But the GMI is at 5 and on a Buy signal.

IBD says correction over; GMI flashes Buy signal; GLD Stage 2 up-trend over

GMI

4/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

72%

IBD used to say all up-trends began after a high volume follow-through day, until now. This was a very short and unusual down-turn.  However, the QQQ short term down-trend remains in place by my count. Monday was the 7th day of this down-trend.  Tech stocks have lagged the large cap stocks. It remains to be seen whether the techs will continue this rise.

Meanwhile, this weekly chart shows that GLD (gold ETF) is now below its 30 week average (red line) indicating the stage 2 up-trend is likely over.

GLDwkly04012014

 

6th day of $QQQ short term down-trend; GMI could signal a Buy

GMI

4/6

GMI-2

1/8

What is the GMI?
 

WORDEN T2108

68%

The GMI could signal a Buy with a strong day on Tuesday, even as the GMI-2 sinks to 1.  This is a very split market with the tech and growth stocks lagging.  I remain mainly in cash.  Will stocks rally with earnings?  Meanwhile, gold is breaking down and the Stage 2 advance appears to be over.

5th day of $QQQ short term down-trend; $FANG shows strength

GMI

1/6

GMI-2

2/8

What is the GMI?
 

WORDEN T2108

60%

Monday is a critical day for the market.  The QQQ is over-sold and it will either bounce or begin a significant decline. The key is to wait for the end of the trading day, around 3:45 PM, to see where the market will settle.  Right now I remain mainly in cash in my trading accounts, with a small position in SQQQ.

I ran my scan for stocks that reached a 52 week high on Friday and had good recent quarterly earnings. Almost one half of the only 17 stocks that came up were involved in energy.  Three of the energy stocks (EOG, WGP, FANG) have been on the IBD 50 list or in their New America column.  If the market turns up, I prefer FANG.  Check out its daily chart below. Note the 30% rise in February, followed by a 5 week consolidation. FANG has just broken out and now has expanding Bollinger bands.

FANGdaily03282014

But with the GMI on a recent Sell signal, I will keep my powder dry and wait for a change in trend to go long again. Note that the QQQ is now back below its critical 10 week average. In contrast, the SPY is still above its 10 week average.  This decline has targeted biotech and growth stocks.

GMI03282014

 

4th day of $QQQ short term down-trend; GMI flashes Sell; mainly in cash

GMI

1/6

GMI-2

2/8

What is the GMI?
 

WORDEN T2108

57%

With the GMI turning to Sell, I am in cash with a very small position in SQQQ in my trading accounts. The longer term trend remains up. On the other hand, the QQQ is very over sold, with a low daily 10.4 stochastic,  and it could bounce at anytime.  Sentiment in my class on Thursday was also quite bearish. That is why cash is the safest place for me now.

IBD sees market in correction; 3rd day of $QQQ short term down-trend

GMI

2/6

GMI-2

2/8

What is the GMI?
 

WORDEN T2108

59%

My trading accounts are now in cash or in SQQQ.  The failure of leading stocks to hold during the last week of the quarter is a serious omen for me.  Moreover, most recent green line break-outs have failed to hold. I remain invested in mutual funds in my university pension for now. IBD has now called the market in a correction. The GMI has fallen to 2 (of 6).  Another day below 3 will trigger a new GMI Sell signal.

2nd day of $QQQ short term down-trend; $AAPL shines; $HAL green line break-out

GMI

4/6

GMI-2

3/8

What is the GMI?
 

WORDEN T2108

65%

AAPL shined again on Tuesday.  AAPL held its trend line break-out for the second day.

AAPL03252014

HAL had a green line break-out with above average volume  last Friday.  So far, it is holding. Cup and handle? Check out this daily chart. (I have a very small position in HAL.) IBD comp rating: 89

HALdaily03252014

 

New $QQQ short term down-trend; $AAPL showing strength

GMI

4/6

GMI-2

3/8

What is the GMI?
 

WORDEN T2108

64%

I am raising stops and getting ready to move into SQQQ if this down-trend continues. It is still possible the market will rise the rest of the week with end of quarter window dressing.  But they are shooting all of the leaders now, except for AAPL. AAPL was strong on Monday and may have broken its down-trend (green trend line) , see daily chart below. I took a small bite of AAPL on Monday and will spit it out if it falls back below this trend line.

AAPL03242014

 

$QQQ short term up-trend in jeopardy; 3D stocks looking weak; $XEC, $NGVC, $ASGN–green line break-out

GMI

5/6

GMI-2

5/8

What is the GMI?
 

WORDEN T2108

66%

Friday’s late reversal threatens to end the QQQ short term up-trend that completed its 29th day on Friday. A down or flat day on Monday could begin a new short term down-trend.  However, with the end of the first quarter mutual fund window dressing occurring this week, the market could start off down on Monday and come back strong towards the end of the day and the rest of the week.  I will watch the market carefully for signs of a trend change.  To hedge my trading account, I have a small position in SQQQ and a somewhat larger position in TQQQ.  I will adjust these holdings when the short term trend becomes clearer to me.  Short term down-trends often give brief fake-out moves  that last only a few days. I am re-posting a chart of the short term up and down trends that I posted in early February. Note that 41% of the 51 down-trends between 2006 and December, 2013 (as I define them) lasted 5 days or less.

Duration If a short term down-trend begins, I will be more sure of it once it passes day 5 and add more SQQQ then. Another possible  scenario is for a bounce later this week, followed by a resumption of a down-trend.  Then again, with earnings release season in April, we could see a decline leading to a significant advance when earnings start coming out.  Take your pick…..

One source of concern is the topping behavior of the 3D printing stocks that have had a huge bull market run.  XONE, ONVO, DDD, and SSYS have all developed weak chart patterns.  For example, look at what appears to me to be a head and shoulders top in SSYS in its weekly chart. Note the large red volume spikes, suggesting selling by mutual funds. I drew in a possible neckline which has been penetrated. Another danger sign is that the 30 week average (red line) is now starting to level off.

SSYSwkly03212014

The other three 3D stocks have similar weak chart patterns. Even 3D stocks do not advance forever……………….

Meanwhile, the GMI is at 5 (of 6) indicating to me a still solid longer term up-trend in the general market. The more sensitive GMI-2 is now at 5 (of 8) reflecting weakness in its very short term components.

GMI03212014

There was an interesting green line break-out stock on Friday, XEC. Check out its daily chart. Any stock that can sprint to an all-time high in a weak market and hold it is worth watching. XEC has an IBD comp rating of 94.

XECdaiy03212014

NGVC, an IPO in 2012 also broke its green line last week.  Check out its weekly chart. IBD comp rating: 90.

NGVCwkly03212014And ASGN broke its 2000 peak, IBD comp:  95.

ASGNwkly03212014

28th day of $QQQ short term up-trend; $ASGN green line break-out resumes

GMI

5/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

65%

GMI-2 is now at 8 (of 8).  These are a collection of very short term indicators.

ASGN recently re-tested its green line break-out and headed up on Thursday on above average volume. ASGN has an IBD composite rating of 96.

ASGN03202014

 



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