Dr. Wish

This new QQQ up-trend is uncertain for me until it reaches the 5th day.   Once a short term trend lasts 5 days it is much more likely to continue.   The adviser poll results in IBD show only about 4% more bulls than bears.   Having so many advisers being bearish is a sign of possible strength for the market.   If we could get more bears than bulls, we might have a true bottom of the decline in place.   Note that the T2108 is at 31%, back into neutral territory. I remain in cash.

While Wednesday was the first day of the new QQQ short term up-trend, I normally want to see   a new trend last for 5 days before I become confident in it.   The longer term trends remain down and I am cautious about this rally’s ability to break through resistance. I would like to see the GMI rise to 4 before jumping back in on the long side.

Another up or flat day on Wednesday will change my QQQ short term trend count to an up-trend.   Tuesday was the 20th day of the current short term down-trend.   The longer term trend remains down.   September is typically the worst month of the year for the market, so I would not be surprised to see a decline start soon. By the way, I am not concerned that the market is rising on sluggish volume.   The multi-month rally that began last September also came on below average trading volume. Check out this monthly chart of the QQQ (click on chart to enlarge).