The Nasdaq 100 Index, as measured by the ETF, QQQQ, looks as if it started a new short term up-trend. However, with the key moving averages being flat, I don’t trust these signals yet. But I remain vigilant for signs of a turn. There were 9 new highs and 107 new lows in my universe of 4,000 stocks on Wednesday. Interestingly, 60% of the Nasdaq 100 now have their MACD close above its signal line, the most since January 9th. A rise of the MACD above its signal line often occurs before a trend turns up. Four stocks at new highs were on my IBD100 lists: HMSY,MYGN,SXCI and CEPH. These stocks should be watched for possible leadership in a sustained rally. Meanwhile, the GMI and GMI-R increased on Wednesday. I prefer the GMI to be above 3 before I take large long positions. I remain mainly in cash.
IBD100
Tech stocks up, but still in down-trend; education sector rocks
The more sensitive GMI-R rose to 3 (of 10). 82% of the Nasdaq 100 stocks rose, and 49% closed above their 30 day averages. There were 11 new highs and 121 new lows in my universe of 4,000 stocks on Tuesday. Among the 11 stocks at new highs were 4 stocks on my IBD100 lists: DLTR, ESI, MYGN and SXCI. Three other education stocks were on the new high list: COCO, CECO and LINC. Clearly, this sector is a stand-out in a down market. I remain mainly in cash.
Moving averages are flat; many education stocks strong
The GMI-R climbed to one (of 10). There were 9 new highs and 214 new lows in my universe of 4,000 stocks on Monday. The last time we had over 200 new lows was on January 20th. In contrast, the most daily new highs this year was 20, on January 2nd. The QQQQ completed the 13th day of its current short term down-trend. Nevertheless, the key moving averages are flat and have all converged. At some point a new trend will break out. Some stocks are looking strong. Among the new highs today were two stocks on my IBD100 lists: ESI and SXCI. The strongest group I have found is the education and training services group: APOL, CECO, COCO and ESI are doing incredibly well in this declining market. During hard times, people go back to school.