Blog Post: 1,106 new yearly US lows and 12 new highs; put/call ratio EXTREME at 1.26, $GNRC showing strength in stormy seas, see daily chart

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GMI-22/8
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With a p/c ratio of 1.26 the market will likely bounce.

I am watching GNRC for a short term rally. GNRC, the generator maker,  usually rises when the US is hit with a hurricane and has shown good relative strength the past 2 days. Look at the volume on Friday and Monday as it rose in a declining market.

 

 

 

 

Blog Post: Market stats are similar to what occurred at June low: 1,374 new yearly US lows vs. 1,394 at June low, 81 Nasdaq 100 stocks with oversold daily 10.4 stochastics vs 85; T2108 = 12 now vs 11; P/C ratio= 1.08 vs. 1.17, but reached a more extreme 1.27 days before June bottom, see charts for trend

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GMI-22/8
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Friday’s indicators are very close to what occurred last June 16 when the QQQ bottomed and began a large rally. Will we get another tradable rally or will QQQ decline to hit that lower trend channel line or something else? No one knows but stocks often bounce during earnings season. These charts reveal the trend. First the daily…

This weekly 10:30 chart provides another picture of the trend. QQQ is leading the two averages lower.

Finally, my favorite chart is  a weekly chart displaying the 4,10, and 30 week averages. QQQ kissed the 4 wk avg. last week and continued down. Note how declines tend to ride the declining 4wk average (red dotted) down. When a real market turn comes, QQQ will close above the 4wk then the 10 wk and then the 30 wk averages which will then begin to turn up. Until that happens, the down-trend is not over.  Trend followers react after the desired signals appear, not before.

When the GMI=0, it is probably best to go short or go fishing….

Blog Post: 1,011 new yearly lows for US stocks on Thursday; I am so sorry for those well meaning but uninformed people who did not exit this market more than 9 months ago when the technicals signaled trouble. This quote from Jesse Livermore says it all.

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“Finally there came the awful day of reckoning for the bulls and the optimists and the wishful thinkers and those vast hordes that, dreading the pain of a small loss at the beginning, were now about to suffer total amputation-without anesthetics.”

This quote appears in this slide which I will show my students tomorrow. It is indeed unfortunate that many older persons, and especially retirees, are having their financial lives threatened by the current declining market. This is why I publish this blog and teach young people what I wish someone had taught me at their ages.