19th day of $QQQ short term up-trend; Biotech green line break-outs: RCPT, CMRX

GMI

4/6

GMI-2

5/8

What is the GMI?
 

WORDEN T2108

50%

The bond ETF’s continue to decline.  Interest rates are rising…….

Here are monthly charts of 2 biotechs that had green line break-outs to all-time highs on Wednesday. They may be worth researching.

RCPTmonthlyCMRXmonthly

As of Tuesday’s close, GMI declines to 5, GMI2 to 4.

GMI

5/6

GMI-2

4/8

What is the GMI?
 

WORDEN T2108

50%

Sorry for this late post.  With the GMI2 at 4 (of 8) half of these sensitive indicators are now negative.  And with earnings out and the AAPL event completed, this market may have little to propel it higher until 3rd  quarter earnings come out. But let’s not forget the Fed’s impending tightening.

17th day of $QQQ short term up-trend

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

56%

$OILT– cup and handle break-out; 16th day of current $QQQ short term up-trend; $IEF signals interest rates to rise?

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

59%

OILT came up on my TC2000 scan for rockets bouncing off of their 10 week average.  When I looked at it, it appears to have broken out of a cup and handle base on Thursday on unusually high volume.  Check out this daily chart:

OILTcupandhandle09062014OILT closed Friday right at the pivot point.  If I bought it here and it trades back below 49, I probably would exit.

Meanwhile the market remains in an up-trend, with the GMI at 6 (of 6).

GMI09052014My biggest concern is that the Fed will start raising rates and kill this market.  This monthly chart of the 7-10 year treasury bond ETF (IEF) is very ominous.  Note that the 30 month average (red line) is now flat and could be starting to decline, after many months of advancing. IEF has now spent 16 months below this moving average. The IEF has not traded like this since 2005-2007, and we all know what happened to the markets after that. Are bond traders warning us of rising rates to come? (When bonds decline, their yields, (or interest rates) rise.)

IEFmonthly

 

15th day of $QQQ short term up-trend

GMI

6/6

GMI-2

6/8

What is the GMI?
 

WORDEN T2108

57%

14th day of $QQQ short term up-trend

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

62%

13th day of $QQQ short term up-trend; $ACAD shoots up

GMI

6/6

GMI-2

8/8

What is the GMI?
 

WORDEN T2108

62%

ACAD, one of Judy’s favorites, had a huge up day (+10.97%) on extraordinary volume.  This monthly chart shows that ACAD recently broke above and re-tested its green line top.  I bought a little and will hold it so I keep an eye on it.  It looks like ACAD is nearing approval of a terrific new drug.

ACADmonthly

 

New Rocket Scan; 12th day of $QQQ short term up-trend; $THRM, $LEA-cup and handle

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

63%

One of the best areas of support for a rising stock is its 10 week moving average. A lot of rocket stocks rest there and then resume their rise.  I created a new TC2000 scan that scans over 6,000 U.S. stocks for a strong rocket pattern and a bounce up off of the stock’s ten week average.  This scan gives me a small list of stocks to research further for possible purchase. This weekend’s scan yielded 10 stocks, shown on the right. Rocketbounce10wkscan08312014Two of them, PANW and THRM, have a blue flag on the left column, indicating they have appeared on an IBD50 list or other IBD lists at some point.  I looked closely at THRM (which I own) and found that it appears to have broken out of a cup and handle pattern, a base that occurs in an up-trend. I have labeled this daily chart of THRM to illustrate the pattern’s primary components.  First, there must be a prior up-trend because this is a continuation pattern. Second, there must be a pattern that looks like a side view of a cup and handle.  Then there must be a break out above the top of the handle (blue solid line) on above average volume.  IBD made this pattern famous as one that can lead to a large gain.  As always, however, whether this break-out continues will depend on the general market’s trend. I typically sell quickly if a stock closes back below its 10 week average or if a break-out fails.

THRMcupandhandle

LEA is another cup and handle break-out in the strong auto parts group.

LEAcupandhandle

Meanwhile, the GMI remains at a strong 6 (of 6) and a Buy signal.

GMI08292014

 

11th day of $QQQ short term up-trend

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

59%

Weak month of September on the horizon.

10th day of $QQQ short term uptrend

GMI

6/6

GMI-2

7/8

What is the GMI?
 

WORDEN T2108

60%



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