Stock Market Technical Indicators & Analysis
All of the shorter term averages (red) are rising above the longer term averages (blue) in a RWB up-trend. The daily closes are shown by the dotted line. Note the oversold bounce marked by a blue dot in the second daily chart. I plan to explain my blue dot indicator in my presentation at the Boston IBD Meetup online in May. More details about this meeting in a future post.
With QQQ now below its 30 week average, the Stage 2 up-trend is in serious jeopardy. I have begun to transfer university retirement accounts out of mutual funds. I do not want to give up the substantial gains they made the past 2 years. I would rather be safe than sorry. If the market holds I can always reinvest. If the 30 week average should curve down, I will take all remaining funds out of stocks. That strategy saved me from most of the declines in 2000 and 2008. The 30 week average is the solid red line in this chart. The last time QQQ closed the week below the 30 week average was last September, for one week only. Tops usually take a few weeks, with false rallies, to set up so I may be early. Youths under 30 can wait out any significant decline. I can’t.
These 13 stocks on my list of 559 promising stocks reached an all-time high, ATH, on Friday. They are ranked in descending order of the last column, close today divided by close 250 days ago. Only one of them, CCB, is more than twice its price a year ago. The fact that 5 of them, PLMR, AXS, PGR, BRO, AJG are in the insurance business is noteworthy. As we all know, insurance costs have skyrocketed, thus growing profits for the industry. PLMR held its green line on above average volume after having a GLB after recently releasing its earnings. During a weak market, stocks that can reach an ATH are showing incredible strength. See PLMR’s daily chart below.
The GMI is RED and both QQQ and SPY have closed below their 10 week averages. Time for me to be in cash and/or very risk adverse with close stops in my trading accounts. I may nibble at a stock for insurance, however, ha ha. It is so much easier to be profitable trading long when the GMI is Green and registers 5 or more.
