Dr. Wish

The GMI remains at 5.  On Friday, there were 183 new highs in my universe of 4,000 stocks and only 9 new lows.  67% of the Nasdaq 100 stocks rose, along with 72% of the S&P 500 stocks and 97% of the Dow 30 stocks.  81% of the Nasdaq 100 stocks have now closed above their 30 day averages.  24% of my universe of stocks are within 5% of their yearly high.  66% of the IBD 100 stocks from 5/15 advanced on Friday, as did 60% of my stock universe.  It looks like the strong IBD 100 type of growth stocks are now leading the market up.  Friday was the eleventh day in the current QQQQ up-trend….

I thought it might be useful to see how the GMI performed during the recent decline.  As the chart shows (click on to enlarge), the GMI topped out at 6 on May 8 and 9 and fell to 4 on May 11.  It remained below 5 until August 16 and was between 0-2 during most of the decline.  Between May 11 and August 16, the QQQQ declined 5.3% and 70% of the QQQQ stocks (Nasdaq 100) declined.  It was during this period that it made sense to be in cash or short.  Now that the GMI is hovering around 5, it is time for me to be adding stocks.  When the GMI turns 6, the up-trend will be on a strong footing……………

Please send your comments to:  silentknight@wishingwealthblog.com.

The GMI is still at 5 and there were 203 new highs in my universe of 4,000 stocks.  Only ten stocks hit a new low.  47-57% of the stocks in the Nasdaq 100, S&P 500 and Dow 30 indexes rose on Thursday.  71% of the stocks in my universe are now above their 10 week average, up from 23% on July 17.  53% of the IBD 100 stocks from 8/14 rose, indicating that these types of growth stocks are still not yet outperforming the other stocks.  People are still skeptical of this market.  However, the QQQQ has now closed for three weeks above its ten week average.  If the QQQQ can close above its 30 week average the GMI will turn 6.  I am still accumulating QLD because I am more confident of the general Nasdaq 100 index trend, than of picking individual stocks.  There is still a lot of whip-sawing back and forth on stocks breaking out.  This is not the time to be on the short side.

Please send your comments to:  silentknight@wishingwealthblog.com.