16th day of $QQQ short term up-trend

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

64%

11 stocks came up on my new high with good fundamentals scan:

Screen shot 2015-02-26 at 9.41.04 PMCheck them out.

15th day of $QQQ short term up-trend; Beware of $TSLA and $SNDK

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

65%

TSLA has a troubling GMMA chart.

TSLAGMMA02252015As does SNDK:

SNDKGMMA02252015

14th day of $QQQ short term up-trend; 12 promising stocks at new highs

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

64%

Twelve stocks came up in my new high and great fundamentals scan.  All of these stocks have RWB rocket patterns and are worth researching.  All but BMA are at all-time highs. I own two of them.

Highfund02242015

 

13th day of $QQQ short term up-trend; $AAPL, $SWKS–RWB stocks

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

64%

AAPL remains in an RWB rocket pattern.

AAPLGMMA02232015As does its supplier, SWKS.

SWKSGMMA02232015

Both are above their green line, all-time peaks.

An important limitation of the GMI signals

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

64%

I have found that since 2006, the GMI has done a good job of keeping me on the side of the general market trend. It is my cardinal rule to trade consistent with the market trend.  While the GMI has helped me to exit the market in prior major declines, I have discovered an important limitation while examining GMMA charts. From the GMMA chart of the QQQ below, I can see that since early 2014, the GMI has issued 7 separate Sell signals (red arrows) followed by 7 Buy signals (green arrows). However, during this entire time the QQQ has remained in a strong RWB up-trend, with all of the shorter term averages (red) above the rising longer term averages (blue)!

QQQGMMA02202015It is clear to me that a GMI Sell signal should only be used by me  for short term trading decisions. Last week I posted that prior major market tops have been signaled when the shorter averages declined below the longer term averages. I should therefore probably remain invested long term in the market (at least in my university pension account) as long as the RWB pattern is in place, even when the GMI signals Sell. I am reinvesting my pension funds back into mutual funds. In the future I will use the GMI signals only to guide my shorter term trading in my more speculative accounts. I will heed the GMMA chart for longer term trends. One must never stop learning and adapting when it comes to the markets….

The GMI remains at 6 (of 6).

GMI02202015

11th day of $QQQ short term up-trend

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

62%

My indicators remain all positive.

10th day of $QQQ short term up-trend

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

62%

GMI is back to 6 (of 6).

11th day of $QQQ short term up-trend; have treasury bonds peaked?

GMI

5/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

63%

This daily chart of TLT, the ETF of the 20 year treasury bonds, is showing possible signs of the long awaited bottom in interest rates.

TLT02172015

As is IEF, the ETF for the 7-10 year treasury bonds.

IEF02172015

The price of bonds falls as investors fear a rise in interest rates.

GMMA charts show no market top in sight

GMI

5/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

64%

I read a lot of pundits who repeatedly claim that this market is topping. If they keep claiming this, someone will eventually be correct! But we technicians rely on indicators to guide our trading. We must always guard against marrying a scenario and be ready to change direction to be consistent with the market’s main trend. One of the methods I have found useful for timing the market is to use a modification of the the GMMA charts developed by the Australian  technician, Daryl Guppy.  Guppy charts plot 12 weekly exponential moving averages on a chart. Six are shorter term averages and 6 are longer term averages. I have added a 13th average, a simple average of length 1 to show me the closing price each week. I always plot the 6 shorter term averages in red and the longer term averages in blue.  A chart where the red lines are rising above and separated from the rising blue lines is showing a RWB advancing pattern. The reverse, a BWR pattern, is evidence of a declining pattern. I make the price bars white so they do not visually distract from the averages.

This chart of the top of the QQQ in 2000, shows how the RWB pattern failed and became a BWR pattern. This is what a market top looks like. The red lines converge, demonstrating little price movement over the different average lengths, and finally you get the red lines below the blue lines with a white area separating them. Note the re-emergence of the RWB pattern in 2003, after the bottom . (Click on chart to enlarge.)

Telechart2000QQQtopNow look at the 2007 top. Again we find the RWB pattern turning into a BWR pattern. Anytime the white space disappears and the red lines fall below the blue lines it is appropriate for me to become defensive.

Telechart2008topSo what is the current GMMA pattern showing? A clear continuing RWB advance! In fact, it looks like we have broken out of a consolidation where the red lines converged and have now turned up again. Note that a  RWB pattern  has persisted since early 2013.

Telechart2015

By the way, I like to use GMMA charts for analyzing individual stocks too.  See AAPL below.

AAPLgyppy02152015And TSLA–no more RWB!

TSLAguppy02152015

The entire bull to bear cycle in GLD is remarkably clear. Guess where we are now?!

GLDguppy02152015

With that said, I have begun to transfer some of my university pension funds back into mutual funds. The GMI has been on a Buy signal since January 23rd, and I have resisted it until now. Everyone has to sell down to their own comfort level.

GMI02132015

 

7th day of $QQQ short term up-trend; $PTLA taking off?

GMI

5/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

63%

Rally rolls on. PTLA is a stock my stock buddy Judy has talked to me about for a long time. They have an exciting drug under development. This weekly chart shows that the  stock may be getting ready to re-take its green line top to another all-time high. I own some.

PTLA02132015



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