The market continued to gain strength on Wednesday. The GMI is at 5 for the first time since October 17. Another strong day on Thursday could trigger a GMI buy signal. IBD still sees the market in an up-trend. It has taken over 40 years of trading to realize I must trust the indicators and not my emotions. It is scary to buy into a new up-trend because, by definition, it often occurs after a down-trend. We all tend to drive with our hands on the rear view mirror. The past colors our perceptions. So I grit my teeth and go long, but gradually, and in stages. If this new up-trend lasts for five days, I will pyramid up. Too many times after a long up-trend, I find that I would have done great had I just begun buying index ETF’s early in the up-trend. I am doing so now, but will exit quickly if the new up-trend fails.
New QQQ short term up-trend; buying TQQQ
While the GMI remains in a sell mode, the QQQ short term trend turned up. Tuesday was the first day of the new up-trend. I will become more confident of the new trend if it reaches day 5. Until then, I am buying a little TQQQ. If it reaches day 5, I will double my position. But I will feel much more confident in the up-trend if the GMI can rise above 3.
33rd day of QQQ short term down-trend; DDD surges
One more strong day for the QQQ will begin a new short term up-trend. However, the GMI is back to 2 and it will take a few more strong days for that indicator to signal a buy. Even so, I nibbled a little at TQQQ on Monday and will add more on Tuesday if a new short term up-trend should begin. I am never confident of a short term trend change until it reaches day 5.
Last May 24, I wrote that my “concept” stock buddy, Judy, liked the 3D printing business and the company, DDD. DDD closed then around $30. Well, look at the day DDD had on Monday, up 11.5%! 3D printing is an entirely new field of technology. If you think that it is related to those movies we saw as kids with those special red and green glasses, you better research this new concept! Below is a daily chart of DDD. Note its two recent advances on huge trading volume–funds are buying. (Click on chart to enlarge.) Is this a promising cup and handle pattern? Given the stock’s recent relative strength, I would not be surprised to see DDD as a leader in the next market advance. Also check out SSYS, another 3D company.
