GMI: 0; IBD 100 stocks bounce most

The GMI remains at zero.  Gmi0614 For the first time since June 1, the majority of stocks in all three indexes advanced–  63% of the Nasdaq 100 stocks, 61% of the S&P 500 and 83% of the Dow 30 stocks.  There were still only 4 new highs and 245 new lows in my universe of nearly 4,000 stocks.  Only 13% of stocks are in a short term up-trend, and only 14% closed above their 10 week averages. Wednesday was the 24th day in the current QQQQ down-trend.

The comparison of my universe of stocks and the IBD 100 shows a striking difference in performance on Wednesday.  The IBD 100 stocks have been underperforming for weeks.  On Wednesday, however, Ibd0614 85% of the IBD 100 stocks advanced, compared with 57% of the stocks in my universe.  86% of the IBD 100 stocks closed above their opening price……

Usually after a severe down-trend, people are more comfortable wading into the conservative blue chip stocks;  83% of the Dow 30 stocks rose on Wednesday.  The fact that most of the very oversold IBD 100 stocks also rose suggests to me that this rise may only be a dead cat bounce.  The technical damage to the markets has been extensive and the markets would have to rise a lot more before the down-trends would be reversed.  Time will tell if that will happen.  Until then, I trade consistent with a continuing market down-trend.

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