GMI: 0; Unbiased performance of the IBD 100 stocks; Cash and puts

@ 8:32 am

The GMI starts the new week at zero.  Gmi0616On Friday, 30% of the Nasdaq 100 stocks advanced, along with 28% of the S&P 500 stocks and 50% of the Dow 30 stocks.  There were 25 new highs and 52 new lows in my universe of nearly 4,000 stocks.  Only 9% of stocks are in a short term up-trend and 20% closed above their 10 week averages.  Friday was the 26th day in the current QQQQ down-trend.

There were small changes in the IBD 100 stocks as of 5/15.  If you had bought one of these stocks when they were posted on 5/15 and held it through Friday, Ibd0616 you had an 8/100 chance of having a profit.  Only one of the 100 stocks hit a new high on Friday—GYMB……..

In today’s edition, IBD mentions in one place that VOL is being added to the IBD 100 list.  And then in another part of the paper, VOL is listed in a table as the top gainer in the IBD 100 stocks.  Maybe I am cynical, but I think this is misleading.  By deleting the poor performers each week and replacing them with new winners the IBD 100 stock list can always look great.  That is why I track in the table above a list of the IBD 100 stocks as of a specified date (currently 5/15) for several months.  This approach provides a better estimate of the performance of the IBD 100 stocks over time.

It is too early to tell whether the current rally is just a pause in the down-trend or the beginning of a new up-trend.  I remain in cash and in put options.

Please send your comments to:  silentknight@wishingwealthblog.com.

GMI: 0; GMI-S: 25; Bounce or turn?

@ 6:49 am

The GMI remains at zero, although just about all stocks advanced on Thursday– 97% of the Nasdaq 100 stocks, 96% of the S&P 500 and 100% of the Dow 30 stocks.  The GMI-S rose to +25 solely because the indexes closed above their 10 day averages. Still the market has a long way to go to turn the GMI positive.  Gmi0615 There were 12 new highs and 50 new lows in my universe of nearly 4,000 stocks.  Only 27% of the Nasdaq 100 stocks closed above their 30 day averages, and 22% are above their 10 week averages.  Only 36% of stocks are in a bullish up-trend.  Thursday was the 25th day of the QQQQ down-trend.

The IBD 100 stocks as of 5/15 had another strong day.  Ibd0615 96% of the IBD 100 advanced, compared with 90% of my universe of stocks.  And 96% of the IBD 100 closed higher than they opened.  70% of the IBD 100 are now in a bullish up-trend.  The two IBD 100 stocks to hit a new high Thursday were GYMB and XPRSA.  Most of the strength came with regard to the short term averages.  Thus, 37% of the IBD 100 stocks are now above their average close for the past 10 days (10 day average).  However, only 9% are above their average closes for the past 30 days, a key measure of strength.  Just 9% of the IBD 100 list on 5/15 closed Thursday above their close on 5/15.

Only time will tell whether this rush to buy is more than a brief bounce from the string of down days.  Most bottoms take time to form, with at least one re-test of the lows.  I only know a turn after a new trend is established. For now, the trend remains down.

Please send your comments to:  silentknight@wishingwealthblog.com.

GMI: 0; IBD 100 stocks bounce most

@ 6:26 am

The GMI remains at zero.  Gmi0614 For the first time since June 1, the majority of stocks in all three indexes advanced–  63% of the Nasdaq 100 stocks, 61% of the S&P 500 and 83% of the Dow 30 stocks.  There were still only 4 new highs and 245 new lows in my universe of nearly 4,000 stocks.  Only 13% of stocks are in a short term up-trend, and only 14% closed above their 10 week averages. Wednesday was the 24th day in the current QQQQ down-trend.

The comparison of my universe of stocks and the IBD 100 shows a striking difference in performance on Wednesday.  The IBD 100 stocks have been underperforming for weeks.  On Wednesday, however, Ibd0614 85% of the IBD 100 stocks advanced, compared with 57% of the stocks in my universe.  86% of the IBD 100 stocks closed above their opening price……

Usually after a severe down-trend, people are more comfortable wading into the conservative blue chip stocks;  83% of the Dow 30 stocks rose on Wednesday.  The fact that most of the very oversold IBD 100 stocks also rose suggests to me that this rise may only be a dead cat bounce.  The technical damage to the markets has been extensive and the markets would have to rise a lot more before the down-trends would be reversed.  Time will tell if that will happen.  Until then, I trade consistent with a continuing market down-trend.

Please send your comments to:  silentknight@wishingwealthblog.com.