GMI: 0; GMI-R: 0; 8th day of QQQQ down-trend; stocks at new highs

No change in the GMI and GMI-R.  Note that there were 20 new highs and 452 new lows in my universe of 4,000 stocks on Thursday.  This was the highest number of new lows since July 15, when there were 988.  The Worden T2108 indicator is now at 37%.

Whenever the market is weak I keep an eye out for stocks hitting new 52 week highs.  I especially like stocks near their all-time high. These may be the next leaders when the market recovers.  Stocks I am watching (some of which I own) include DXPE, CRMT,  SXE, HGR, FSYS, HWK, VAR, STE.  All of these companies have great earnings and technicals.  Sometimes I cannot resist nibbling at promising stocks even in a declining market, but I always use a close stop.  Cutting losses quickly is the trader's secret weapon–the first loss is often  the smallest loss.  If a stock fails to behave as  I have predicted, I get out of my position.  Do not tolerate a misbehaving stock!  With the small commissions available these days, I can always afford to buy it back if the stock behaves well again.  Some of my best gains have come from buying back stocks that I have been scared out of.  As long as I am trading in a tax deferred account, I do not have to worry about the wash sales tax rules.   Nevertheless, I remain  over 90% in cash during market down-trends—like this.

2 thoughts on “GMI: 0; GMI-R: 0; 8th day of QQQQ down-trend; stocks at new highs”

  1. While selecting 4000 stocks for your universe, did you exclude all the funds and reits??? Also, how did you manage to plot GMI with QQQQ in your post couple of days back???

    By the way, thanks for sharing your GMI readings. This is one of the thing that I check in the morning and is helping me to be on the right side of the market.

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