My short term indicators are weakening and a lower close of the QQQQ on Monday would bring the GMI to 2. I am very defensive right now. Only 7 new highs and 9 new lows in my universe of 4,000 stocks on Thursday. The Worden T2108 indicator is now down to 41% and will have to fall below 20 to be in possible bottom territory.
The GMI-R has now fallen to 4, reflecting my weak short term indicators. The SPY is now back below its 10 week average, as is the DIA. The QQQQ is still above its 10 week average, reflecting the relative strength in tech stocks–for now. My longer term indicators remain positive. So, this could turn out to be a short term decline within a Stage 2 up-trend.
I am therefore very defensive short term and largely in cash in my trading account, while remaining 15% long in my conservative, pension account. This has been a very tricky market that is difficult to play. In the 2002-03 market bottom it took over 6 months for the real consistent up-trend to materialize. We are still in the, “Is this the bottom?”, period.