Wednesday, May 26, 2010

Wednesday Morning GGT Update

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My LCR Change Timer remains with a CASH recommendation, so no matter what happens today, I'll not be moving into any new long positions.  In fact, truth be known, it reaffirmed the CASH position, simply because the LCR continues to fall.

The new LCR going into Wednesday morning is 0.089.  This is an incredibly low level and suggests that we are extremely oversold (thanks Lisa).  I remind you that just because something is oversold, this does not imply that the markets will move aggressively higher -- we could stay down here for a bit.

I note with interest that the Elder Force Index 13d EMA on the GGT Price series has started to move upward, but is still in negative territory.  When this signal crosses the 0 line into positive territory we generally can move back into long positions.  Note that this is not a sure-fire signal, but certainly is confirming.  Here's the graph:




























As I write this the futures are down across the board, but just slightly.  I note with considerable interest that many of the major market indexes finished with a "hammer" pattern, which if confirmed, could be very bullish.  A confirmation on the hammer pattern is simple:  we must open higher than yesterday's close, and we must finish higher than we opened.  We'll see.

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

Regards,

pgd