Tonight was the monthly local IBD meetup. Normally about 8-10 persons get together to share ideas about stock trading. Tonight, just 3 persons showed up, including me. I wrote after last month’s meeting that people were depressed, bearish and mostly in cash. Still, I was not prepared for such a low turnout tonight. The group leader who has lived through several market cycles was not surprised, and noted that it would take a few months of an up market with people making money, for attendance to pick up again.
I was somewhat shocked to hear that the leader was skeptical about the longevity of the current market rise and was not interested in pursuing volatile growth stocks. His opinion contrasted greatly with mine. By following my market indicators, I was completely comfortable with buying and holding growth stocks and assumed that the other traders in the group would agree. The third attendee had made some profits in stocks, especially GOOG, but was relatively new to trading and had no firm take on the market. I have to conclude that the low attendance and caution about the market constitute contrarian indicators, suggesting that this rally has more to go. I wonder if a lot of other people are turned off to the market right now.
The GMI dropped one point to +4, today. This is because there were only 70 new highs in my universe of 4,000 stocks. There were also only 33 successful 10 day highs. Only 21% of the Nasdaq 100 stocks rose today, 25% of the S&P 500 stocks and 27% of the 30 Dow stocks. Clearly this was a weak day. Today was U14, the 14th day of this uptrend.
In spite of the general market weakness, a number of the stocks I follow and/or own, rose, including: GOOG, BOOM, PRGS, NDAQ, NSI. As far as I am concerned, the market remains in an up trend and I plan to increase my positions as my stocks break to new highs or bounce off of their support levels. Of course, I also have my sell stops in place in case things suddenly turn ugly.
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Please remember that the stock market is a risky place, especially now. I am not providing recommendations for you to follow. My goal is to share tools and methods that I have used over the past 40 years of trading, so that you may learn from them and adapt them to your trading style and needs. While I do my best, I do not guarantee the accuracy of any statistics computed or any resources linked to my blog. Please consult with your financial adviser and a mental health practitioner before you enter the stock market, and please do not take unaffordable risks in the current market environment. See the About section for more statements designed to protect you (and me) as you navigate this market. Past performance does not guarantee future results, but I would rather learn from a former winner than a loser.