GMI:+6; QQQQ turns up; Biotechs to turn?

The GMI finally went to the maximum of +6, with the Daily QQQQ indicator turning positive.  Gmi0302 There were 238 new 52 week highs in my universe of 4,000 stocks.  This represents 6% of all stocks in my universe.  Compare this percent to the 25% of stocks that have doubled in the past year that hit a new 52 week high.  What more proof do we need than this to show that the strongest stocks tend to get stronger ? Nicolas Darvas (see his books to the right) was very wise to have used doubling in the past year as one criterion for  buying a stock.  All of my other indicators changed slightly yesterday.  41% of the Nasdaq 100 stocks rose on Thursday, along with 36% of the S&P 500 stocks and 40% of the Dow 30 stocks.  Still, Thursday was the first day of the new short term up trend in the QQQQ.  With all of the bearish sentiment around for tech stocks, it would be just like the QQQQ to start a major up trend.  Keep an eye on the biotechs, which may be forming a bottom.  The MACD for the biotech ETF, BBH, has recently had a bullish crossover.

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GMI still +5; GMI-S: 88; QQQQ getting stronger; Some new leaders?

The GMI was again +5, and very close to a maximum reading of +6.  This is because the QQQQ came back strongly.  It closed back over its 30 day average and the MACD had a bullish crossover.  One more up day will turn the Daily QQQQ Index positive.  The growing strength of the QQQQ is also reflected in the rebound of the short term GMI-S, to 88.  The longer term GMI-L is at a maximum 100.  Gmi0301_1 There were 276 new 52 week highs in my universe of 4,000 stocks and 34% of the stocks are within 5% of a 52 week high.  74% of the stocks that hit a new high ten days ago closed higher on Wednesday than they did ten days earlier.  Buying stocks at new highs 2 weeks ago has therefore likely to have been profitable.  79% of the Nasdaq 100 stocks advanced on Wednesday, along with 73% of the S&P 500 stocks and 83% of the Dow 30 stocks.  55% of stocks are in a short term up trend, the most since February 3.  69% of stocks are in a longer term up trend.  Wednesday was the 18th and maybe final day of the recent short term down trend in the QQQQ………

A number of stocks with recent quarterly earnings increases of 100% or more had large volume (at least twice their 50 day average volume) moves up today.  They include:  SPW, TER, ATHR, WIRE, ASEI, ASTSF, ASF, JOYG and CYBS.  I own some of these.  The Nasdaq 100 may be about to break out on the up side.  Given that the leaders of a new rise often are among the first stocks to break out, this list may be worth watching.

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GMI: +5; GMI-S falls to 56; GLD

I am posting after the open today, so I will not opine about today’s market.  I only want to provide you with Tuesday’s closing stats. The GMI remained steady at +5, but the GMI-S fell to 56.  This drop occurred because the Nasdaq 100 short term indicators are all negative and because all of the other indexes closed below their 10 day averages.  Closing below the 10 day average is not a sign of huge weakness.  Gmi0228 Typically, consecutive closes above the 10 day average occur during sustained rises.  A stock or index can close below this average and still be in a sustained rise, just rising at a slower rate.  So, the decline in the GMI-S just indicates, for now, a slowing in the rise of these indexes.  A return above the 10 day  average by these indexes would indicate to me a resumption of a stronger short term up trend .  The GMI-L is still at 94, showing that all of these indexes remain in a longer term up trend.  On Tuesday, only 21% of the Nasdaq 100 stocks rose, along with 12% of the S&P 500 stocks and 10% of the Dow 30 stocks.  There were still 150 new highs in my universe of 4,000 stocks.  The percentage of stocks in a short term up trend rose to 53% , but the percentage that closed above their 10 day averages for the past four days declined to 38%, another indication of the slowing of the rises in these stocks……….

I have been buying the gold ETF, GLD, as it appears to have bounced off of its rising 30 day moving average.  In the recent past, such bounces have occurred at the beginning of profitable rises.  I always place a stop loss below the bounce to protect me against a decline.

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