Wishing Wealth Blog

The GMI and GMI-R remain at zero. 

There were 12 new highs and 328 new lows in my universe of 4,000 stocks on Friday.  This number compares with 988 new lows on July 15.  So this decline is not nearly as severe as last July's, thus far. Friday was the fourth day of the current new QQQQ short term down-trend.  Note that the Worden T2108 indicator is now at 42%, in neutral territory far above the extreme lows (below 20%) reached at prior market bottoms.

I have written before that the GMI indicators have helped me to be out of the market or to be mainly in cash during all significant market declines.

  This chart shows how the GMI has tracked the QQQQ since April 17.  It shows only changes in the GMI.  Note that during rises in the QQQQ, the GMI is usually at 4 or above.  When the GMI is below 3, I tend to get defensive.  Note that the GMI held at zero through most of July.  It then rose with the August rally and then fell quickly to 3, to 1 and now, to zero.  This ability of the GMI to track the ups and downs of the QQQQ was also evident in prior time periods.  While not perfect, I rely on the GMI to guide me when to enter and exit growth stocks, as reflected in the QQQQ (Nasdaq 100 index) ETF. Meanwhile, during the past 2 years, 5 consecutive daily declines in the QQQQ is extremely rare and we should expect a bounce on Monday.