Market rally continues; GMCR soars; Rocket Stocks; Dollar cost averaging into my pension

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The QQQQ up-trend completed its 32nd day on Friday.   When will the up-trend end?   No one knows.   My strategy is to hold growth stocks as long as the up-trend is in place.   Prior up-trends the past 3 years   have lasted as long as 86 days.   So the current up-trend may have a time to go, especially with the fear and skepticism accompanying this one.   On Friday there were only 11 stocks at new highs and 11 at new lows.   After the recent market decline there just are not many stocks near their 52 week highs. On two days last week there were   26 new highs in my universe of 4,000 stocks.   The last time there were more than 100 new highs in a day was September 18.

A stock at a 52 week high is rare, but even more rare is one at an all-time high.   I have been highlighting such rocket stocks the past few weeks.   One stock I wrote about in mid-April is GMCR.   Last week the stock soared 35%, bringing my account well into the black for the year.   There are a lot of other stocks at or near all time highs, including QSII, TNDM, ALGT, ARST, NFLX, AAN, AZO, HGG, ORLY, NTES, SNDA, LFT.   All but 2 (HGG and ORLY) are on my IBD100 list from April 27.   I own some of these rocket stocks and think that some of the next great market leaders will be from this list.   Any stock that can come through the past market decline and now be near its all time high is a winner.

Read moreMarket rally continues; GMCR soars; Rocket Stocks; Dollar cost averaging into my pension

Rally remains in place; Technicals are strong; T2108: 90%

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Friday was the 27th day of the current QQQQ short term up-trend.   There were 10 new highs and 6 new lows in my universe of 4.000 stocks on Friday.   Three of the ten new highs were on the IBD100 lists from today’s edition:   STAR, HANS and JJNF.   Since the first day of the QQQQ uptrend (by my definition) on 3/18, the QQQQ has climbed 13%, the Ultra long QQQQ ETF by 28%, and the SPY by 8%.   During this same period, 84% of the stocks in the Nasdaq 100 Index (measured by the ETF, QQQQ) have advanced, with one third advancing 20% or more.   The key to successful trading on the long side is to have the relevant index in an up-trend.

Read moreRally remains in place; Technicals are strong; T2108: 90%

Buying Rocket Stocks; My market indicators are very strong.

I just completed the best 2 week period in a year. I own a lot of the stocks listed to the right, which are having terrific runs.   The GMI registered 5 for the first time since August, 2008, before the start of the major market decline.   My Successful 10 day New High Index turned positive.   There were finally enough stocks that hit a new high 10 days ago that have closed higher than they did 10 days ago.

Stocks on the 52 week new high lists that are also at or near all time   highs is where I find potential rockets.   Nicolas Darvas made a fortune trading such   stocks. IBD100 stocks near all time highs include: GMCR, NFLX, MNRO, QSII, VLGEA, AZO, SNDA, NTES, ALGT. TNDM.   TSYS, HGG and ORLY are also very strong, but are not yet on my IBD100 lists.

While most of the world looks for bargain stocks at new lows, I seek rockets heading to the moon.   The greatest winning stocks are those heading up to ever higher levels.   Think of how many times that YHOO   or CSCO or MSFT hit all time new highs as they multiplied their prices many times during their great bull runs.   If you want to hop a rocket to the moon, it better be pointing up and gaining altitude.

Read moreBuying Rocket Stocks; My market indicators are very strong.

Dow “bottom rally” puny thus far!; IBD100 and other growth stocks at new highs; I’m bullish for now

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A lot of stocks are beginning to look good.   However, there were only 6 new highs and 8 new lows in my universe of 4,000 stocks on Friday.   Two of the 6 new highs are stocks on the IBD100 list,   CPSI and TNDM.   TNDM is at an all-time high and both of these stocks came public within the past 8 years, a prime criterion of past winning stocks, according to IBD founder William O’Neil.       I scanned my universe and found 105 stocks that are within 10% of their 52 week highs and that have promising technicals.   Among these stocks that   are on my IBD100 lists from the past year and that also have last quarterly earnings up 50% or more are:   AIPC, GMCR, ALGT, QSII, SXL, JJSF, NFLX and PNRA.   I own some of these stocks…

The GMI remains at 4 and the GMI-R is at 7.   The IBD Mutual Fund Index is above its 50 day average, indicating to me that growth mutual funds are starting to make money. When these fund managers can make money buying growth stocks, so can I. The Worden T 2108 is now at 84%, heading towards overbought territory, but not a concern to me, given that the market is snapping back from very over-sold readings.   Both the QQQQ and SPY have closed above their 10 week averages for several weeks, a key sign of technical strength. While still in longer term down-trends, when these ETF’s are above their 10 week averages, I have usually been able to make money buying stocks.  

Read moreDow “bottom rally” puny thus far!; IBD100 and other growth stocks at new highs; I’m bullish for now

Is the bear market over? Check out my “Guppy” charts

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Everyone wants to know if the bottom of this bear market is finally in place. The truth is that only liars and lucky people can really call a bear market bottom close to its occurrence.     I noticed years ago that the pundits on TV usually felt comfortable calling a new bull market about six months after the actual bottom.

The true trend follower rides the current trend until his/her indicators suggest a new trend has begun.   But all trends are not   equal.   Within a longer term down-trend there are short term up-trends.   Currently, we have had a daily up-trend within a weekly and monthly   down-trend. Day traders who monitor trends by the minute or hourly, for example, can trade numerous up and down trends within the longer term trend.

Thus, each person needs to determine his trading time interval when trying to trade trends.   And one can trade different pots of money using different time trends.   So I will not commit my university pension money to the long side of the market when the weekly trend is down.   I stay in cash during such periods. But I may trade with my IRA funds during a daily up-trend that is occurring withing a weekly down-trend.   However, I have had more success trading consistent with the weekly trend and tend to stay mainly in cash even in my IRA during a weekly down-trend.   It is hard to resist buying some recovering stocks during a rally like we have just had, even though my longer term trends are still down.

Read moreIs the bear market over? Check out my “Guppy” charts