General Market Index (GMI) table

Longer term up-trend of $QQQ intact; a new short term down-trend could develop with a weak Monday

@ 8:31 pm
GMI5/6
GMI-24/9
T210863%

With the GMI   at 5 (of 6), the longer term up-trend remains intact. IBD sees the market uptrend under pressure and notes that the put/call ratio on Friday was approaching 1.0, a sign that a bounce may be coming as bearishness grows. I am largely in cash in my trading accounts, having had my positions in GLD and NUGT called away at Friday’s close.   We are in the post-earnings release period when the market often corrects.   As we get close to the end of the month and the end of the first quarter, the market will likely recover as it starts to anticipate new earnings reports.   I am waiting to enter positions in rocket stocks when they bounce from oversold levels.   I am also continuing to write some weekly call options. Here is the weekly GMI table:

GMI03142014A weak close on Monday would turn my QQQ short term count (U-24) into a new down-trend.

 

Green line break-outs last week: $SBGL,$WWE,$INVN,$BRKB,$STRT,%PRXL,$PL,$SAIA, $GTAT, $LSTR; 2007 type crash coming?

@ 10:05 pm
GMI6/6
GMI-28/9
T210874%

These 10 stocks broke through multi-month bases to all-time highs last week. I draw a green line at an all-time peak not broken for at least three months, sometimes for years.   I then use TC2000 to put in an alert and send me an email when the green line is broken.   All of my students receive the email alerts. Not all of these stocks will continue rising.   Some will hover around their green line and some will retreat below it and still others will rise after testing the green line. I put these stocks in a watch list and monitor how they behave.   Once a stock surpasses its green line, it may rise for months because there is no over head supply of sellers who bought at higher prices. Also, for a stock to break to an all-time high, especially on high volume, someone may know something good about the company. These stocks are worthy of further research.

SBGLgreenlinewklyWWEgreenlinewklyBRKBgreenline break-out03062014 INVNgreenlinewklyBRKBgreenlinewklySTRTgreenlinewklyPRXLgreenlinewklyPLgreenlinewklySAIAgreenlinewklyLSTRgreenlinewkly

The GMI closed Friday at 6 (of 6) and the GMI-2 is at 8 (of 8).

GMI03072014With all this hysteria about a market top forming like it did in 2007, I thought you might like to compare the market pattern in 2007 to now.   Here is the weekly GMMA chart of the SPY in 2007. Note the danger sign that flashed well in advance when all of the short term averages (red) crossed below the longer term averages (blue):

GMMASPY2007topAnd here is   a current GMMA chart of the SPY.   See any resemblance? As the great bard once said, a coward dies a thousand deaths……

SPYGMMA03092014

14th day of QQQ short term up-trend; be careful

@ 10:36 pm
GMI6/6
GMI-27/9
T210872%

The markets reversed strongly down on Friday as did many of the speculative stocks I watch. Friday was also a high volume down (distribution?) day for the QQQ.   The market averages have been advancing since they bounced on 2/5.   I would not be surprised to see some retracement as current   events in Ukraine provide a catalyst.   International markets are down Sunday night and gold is rallying (Yay!). I will not buy anything else now and will wait to see if the averages   bounce off of support. The QQQ might find support   around 87-88, where a lot of indicators are converging. Here is the daily GMMA chart of the QQQ. Note   all of the rising longer term (blue) averages in the 87-88 area. The market may get to climb a new wall of worry.

GMMAQQQdaily03022014

Meanwhile the GMI remains at 6 (of 6).   Remember, that I am a trend follower and exit after the trend has turned down.   I cannot catch the top. For now, all of my GMI indicators remain positive. Here is the GMI table.

GMI02282014