The market continued to gain strength on Wednesday. The GMI is at 5 for the first time since October 17. Another strong day on Thursday could trigger a GMI buy signal. IBD still sees the market in an up-trend. It has taken over 40 years of trading to realize I must trust the indicators and not my emotions. It is scary to buy into a new up-trend because, by definition, it often occurs after a down-trend. We all tend to drive with our hands on the rear view mirror. The past colors our perceptions. So I grit my teeth and go long, but gradually, and in stages. If this new up-trend lasts for five days, I will pyramid up. Too many times after a long up-trend, I find that I would have done great had I just begun buying index ETF’s early in the up-trend. I am doing so now, but will exit quickly if the new up-trend fails.
Today’s piece was very well written. You accurately described the emotions of many traders.
Elliot wave principle is great way to objectively describe price behaivior and sryrength of market. Helps remove emotion.