Month: January 2013

With the T2108 at 79% (79% of NYSE stocks closed above their average price over the past 40 days) the market is near extreme overbought territory. T2108 can get as high as 85-90%, but when it does the market rally is about over.   So I am proceeding slowly.   Thursday was the second day of the new QQQ short term up-trend and the GMI flashed a Buy signal at Tuesday’s close. LAD, which I wrote about yesterday, moved to another new high.   Other stocks at green line all-time highs are: ABG, CP, V, LMCA, TRMB, EQIX and RAX. All of these were in one of my IBD 50 or other IBD cited watch-lists. They might be worth researching.

Better safe than sorry–but I am safe and sorry.   I stayed in cash to avoid a fiscal cliff debacle.   With a GMI buy signal and a new QQQ short term up-trend in place, I will now look to wade back into the market on the long side.   But the Worden T2108 indicator, at 77%, is getting near overbought and bears watching…….

The two 3D technology stocks, DDD and SSYS,   have been very strong and also bear (bull) watching.   Facebook (FB) and LAD also bounced back strongly on Wednesday. I wrote about LAD on 12/20 when it had a green line cup-with-handle break-out to an all-time high. That break-out failed, but check out its daily chart below.

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I wrote earlier this week that I was mainly in cash in my trading accounts because of the frenetic nature of the market, responding vigorously to each announcement about the fiscal cliff negotiations.   It remains to be seen whether Tuesday’s sudden snap-back rally will hold.   If it does, the GMI and QQQ short term trend could reverse   again. I do not trust changes in the short term trend until they reach five days. I remain on the sidelines in my trading accounts. On the other hand, IBD has changed its view of the market to, confirmed up-trend.   They are typically very good at determining the market’s trend.