Wednesday, March 17, 2010

LCR Change Timer DID NOT CONFIRM

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This market continues to astound me.  Nevertheless, I'm still playing longs.

My pick for GS yesterday paid off ... GS went up 1.53% and my gain was a bit over 1%.  We'll see if it continues to move upward.  This is a risky trade, so be careful if you followed me.

Today's pick is LIHR, but we may be a bit early for this stock as well as industry group.  We'll see.

The GGT Price index hit a new all-time high of $24.83, up nearly 0.7% from Monday's value of $24.66 and a full $0.10 higher than the peak last Friday.  Volume continues to be steady, with 2.0M shares indicated.  New highs on steady volume is bullish.

There was a below-average number of New Longs (64) and above-average number of Affirmed Longs (707), indicating that well-performing stocks continue to perform well, but we're not rotating.  The number of New Cash and Affirmed Cash stocks was well below average, so the bulls clearly won the day.

The Long-Cash Ratio moved higher to 3.237, up from 3.178 and now indicates that 2434 stocks are long in the database and 752 are in a cash status.  Just so that you are under no illusion, the fast LCR EMA is falling in day-over-day change, which means deceleration.  This continues to flash caution overall.

The LCR Change Timer did NOT confirm the transition to CASH.  3 up days of LCR changes and 1 down day of LCR changes were not enough to move this, although it is very close.  If the markets are up only slightly today it is very possible that we could get a confirmed move to CASH, because the down days will have more strength than the up days, so beware.

I continue to hold my longs, but I'm typically setting stops tightly to protect gains.  My typical set point right now is a penny or two below the 2-day-ago low.

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Remember, you are responsible for your own trading decisions, not me.  Do your own diligence.

Regards,

pgd