Month: July 2009

The major indexes all held at their 30 week averages and the QQQQ is in a strong Stage 2 advance.   There were 43 new highs in my universe of 4,000 stocks on Wednesday, the most since September 19th.   There were only 6 new lows.   The GMI is at 5 for the first time since April 24, and the T2108 indicator rebounded to 65%.   I wrote earlier this week that the market was in a short term down-trend within a longer term up-trend.   Well, it looks like the indexes found support at their 30 week averages and the short term down-trend has ended.   The QQQQ is back above its key 10 week average. I am going long in my trading account and transferring more funds from money market to growth mutual funds in my university pension.   It looks to me like we are at the beginning of a Stage 2 advance with the 30 week averages having successfully turned up.   See Weinstein’s book, to the lower right, for an explanation of stage analysis, my primary method for determining the market’s major longer term trend. Among the stocks at new 52 week highs on Wednesday that are close to their all-time highs are:   LL, AIXG, MVL, ORLY, ROST.   Any stock that can come through the past year’s market decline and be trading near its all-time high is a potential market leader that should be watched. I own ROST.

With the GMI and GMI-R back to 1, I remain mainly in cash. I am a chicken, and prefer to wait out times like this.   The T2108 is at 27% still not at the depths where meaningful turns come.   The key to success in the market is to lose little during the bad times.