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I was out late tonight and will not write extensively. Suffice it to say that the GMI held steady at +6, but there were only 265 new highs.
Only about one half of the Nasdaq 100 and S&P 500 stocks rose, compared to 80% of the Dow 30 stocks. The rally ebbs and flows. Note that GDW, one of the consistent long time winners I have talked about hit a new high today………………
Tonight I heard Cramer make the distinction between the short term trader and the investor. Traders should cut their losses at 8% but investors who know the "true value" of stocks can buy on the way down. What a prescription for disaster! No one should average down and no one should let their losses on a purchase exceed 8%. One could have bought Enron all the way down by being a true believer in the accounting statistics and the repeated optimistic company announcements. By the time we outsiders learn the facts, the insiders and people in the know have already sold at much higher prices. No amount of "homework" or research can protect us. That is why one must react to the stock’s behavior as seen in its price chart, not to the corporate propaganda. Shame on you, Cramer.
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Please remember that the stock market is a risky place, especially now. I am not providing recommendations for you to follow. My goal is to share tools and methods that I have used over the past 40 years of trading, so that you may learn from them and adapt them to your trading style and needs. While I do my best, I do not guarantee the accuracy of any statistics computed or any resources linked to my blog. Please consult with your financial adviser and a mental health practitioner before you enter the stock market, and please do not take unaffordable risks in the current market environment. See the About section for more statements designed to protect you (and me) as you navigate this market. Past performance does not guarantee future results, but I would rather learn from a former winner than a loser.