Dr. Wish

GMI: 6; GMI-S: 94; IBD 100 stock performance; Put/call ratio: .94

@ 12:01 am

The GMI held at 6, but only 14-20% of the stocks in the Nasdaq 100, S&P 500 and Dow 30 indexes advanced on Friday. Gmi1027_1 There were 258 new highs in my universe of 4,000 stocks.  The GMI-S fell to 94, with the weakening of one of the short term indicators for the QQQQ.  Still, Friday was the 50th day in the current QQQQ up-trend and the 11th week that it has closed above its 10 week average.

The IBD 100 stock lists that I have been following did a little better than the Nasdaq 100 stocks on Friday.  Ibdperf102722-33% of the stocks in the four lists below advanced on Friday.  The list from 10/16 had 14 new highs, but only 43% of these 100 stocks closed higher than they closed on 10/16 when the list was published.  The 14 stocks from the 10/16 list that hit new highs on Friday were:  HXM,CELG,DRIV,JLL,GRMN,ROG,WCG,TV,SIM,

CTSH,BLUD,WRLD,HCSG, CSH.

Monday’s IBD says that the put/call ratio from Friday was .94.  As long as there remains such a high amount of pessimism exhibited by the options players, this rally probably has further to go.  Put/call ratios near one are rare and typically occur only after a sustained decline.  This is a rally that traders love to hate…..

GMI: 6; Growth is alive

@ 12:01 am

The GMI is still 6.   There were 457 new yearly highs in my universe of 4,000 stocks.   Gmi1026_2 81% of the Nasdaq 100 stocks rose on Thursday, along with 69% of the S&P 500 stocks and 53% of the Dow 30 stocks.   68% of the IBD 100 stocks from 10/16 rose and there were 22 new highs among them.   Taken together, it looks like the tech and growth stocks are rising..

GMI: 6; put/call ratio bullish?

@ 12:01 am

The GMI is still at a maximum of 6.   There were 364 new yearly highs in my universe of 4,000 stocks.   Gmi1025_2 63% of the Nasdaq 100 stocks advanced on Wednesday, along with 58% of the S&P 500 and 70% of the Dow 30 stocks.   58% of the IBD 100 list stocks from 10/16 rose and 14 of these stocks hit a new high.   Wednesday was the 48th day in   the current QQQQ up-trend.

One of the reasons I was confident of a continued rise in the QQQQ is that the put/call ratio on Tuesday was a high .97.   This means that 97 puts were traded for each 100 calls.   Put options are bets on a stock’s decline while call options are bets on a rise.   Option traders tend to be wrong at the extremes.   A put/call ratio near 1.00 is a high reading and often correlated with a rise in the market.   When many people bet on a decline, the market often rises.   It is noteworthy that when this market shows any sign of weakness, many people bet on a further decline.   Skepticism of the market’s rise tends to be bullish.   You can find the put/call ratio each day in IBD in a small chart inside the S&P 500 chart on the General Market page…….