IBD

GMI: 5; AAPL; IBD 100 stocks stronger than Nasdaq 100; window dressing?

@ 8:38 am

I guess we all know why AAPL has been weak.  See the beauty of technical analysis?  The bad news was evident in the stock movement long before it was revealed to the rest of us….

The GMI remains at 5, as the major indexes recovered.  72% of the Nasdaq 100 stocks rose on Wednesday, along with 84% of the S&P 500 stocks and 97% of the Dow 30 stocks.  Gmi1227 There were 306 new 52 week highs on Wednesday and only 7 new lows in my universe of 4,000 stocks.  Still, the QQQQ remains in a downtrend; Wednesday was the 5th day of the current down-trend. The GMI-S is back to 50, but none of my short term indicators for the QQQQ are positive.  We will need to see the end of the 4th quarter mutual fund "window dressing," before we know if this rally is for real.  For now, I remain cautious and skeptical.

An interesting difference in strength occurred on Wednesday in the Nasdaq 100 stocks and the IBD 100 stock lists that I follow.Ibdperf1227 90% or more of the IBD 100 stocks rose on Wednesday, compared with 72% the Nasdaq 100 stocks.  More of these IBD 100 stocks hit new highs and they were more likely to close above their 30 day averages.   It sure looks like the fast growing type of stocks selected for  the IBD  100 lists are outperfoming the Nasdaq 100 stocks right now.  Growth stock window dressing by the mutual funds who want to include the winners in their end of year portfolio statements?  What a great way to look smart, given that the funds fail to disclose the price and date of their acquisitions during the prior quarter….

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GMI: 5; 4th day of QQQQ down-trend

@ 12:24 am

The GMI rebounded to 5 on very light volume on Tuesday and will fall back on any market weakness.  64% of the Nasdaq 100 stocks rose, along with 75% of the S&P 500 stocks and 87% of the Dow 30 stocks.  Gmi1226 There were 167 new 52 week highs in my universe of 4,000 stocks.  Still, the QQQQ is in the 4th day of its current down-trend.  AAPL and RIMM continued to weaken and only 62% of the IBD 100 stock list from 12/18 advanced.  See yesterday’s post below,  for my disclaimer.

GMI: 1; GMI-S: 25; IBD 100 stocks and market leaders falter

@ 12:01 am

Well, the GMI declined to 1 on Friday and the GMI-S fell to 25.  On Friday, only 14% of the Nasdaq 100 stocks rose, along with 21% of the S&P 500 stocks and none of the Dow 30 stocks.  Gmi1222_1 Only 73 stocks in my universe of 4,000 stocks hit a new 52 week high.  Only 32% of the Nasdaq 100 stocks closed above their 30 day averages, the lowest percentage since last July.  Only 25% of my short term indicators for four indexes are positive;  none of the indicators for the Nasdaq 100 stocks are positive, and even the longer term indicators for these indexes has fallen below 100% (GMI-L: 94%) for the first time since October 24.

The IBD 100 stocks are also faltering. Only 38% of the IBD 100 stocks from the list published on 12/18 advanced on Friday and only 2 stocks hit a 52 week high. Ibdperf1222 More telling, only 22% of the stocks from 12/18 closed higher on Friday than they did when that list was published.  With one exception, less than 50% of the stocks in the IBD 100 lists in this table closed above their average price of the past 30 days, and there were very few new highs.

Beware the general market when the leaders weaken.  When a leader like RIMM announces great earnings (+47%) after the close on Thursday , soars on extended trading, and then opens at its high and closes at its low, it is a sign of impending weakness.  On Friday, RIMM opened at 139.97, rose to 140.11 and closed at 130.00, down 3.70 on very heavy above average volume.  Then look at AAPL  which hasn’t hit a new high in 19 days, and GOOG which has not done so in 21 days.  All 3 stocks have now also closed below their 10 day averages.   With the QQQQ in its 3rd day of a new down-trend, I am slowly accumulating QID, which rises as the QQQQ falls. Since the Nasdaq 100 peaked on 11/24, that index has fallen -3.85% and 66% of the Nasdaq 100 stocks have declined and only 23% have risen 1% or more.  With odds like these, it pays to be in cash, or short the tech/growth stock indexes.

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