Thursday, June 24, 2010

Elder 13d Force Index Whipsaws Positive, but ...

Here's the update dashboard through Wednesday's close:

As with all my images, right-mouse click on the picture to open in another tab.

GGT price fell another -0.2% on Wednesday, ending the day at $24.25, down significantly from the peak of 6/15 when it closed at $25.00.  Volume continues to be on the light side, down -21% from the 50d MA of volume.  We're in the summer doldrums in terms of large transactions, although with the end of the quarter around the corner, I did expect volume to increase as the fund managers get positioned.

GGT strength fell again on Wednesday, and is now sitting at 0.326.  We're getting closer to reversal territory, so I would not be surprised of a rebound in the next few days.  Futures are down this morning, but as we've seen numerous times, this could certainly reverse on us.

The GGT LCR Change Timer remains in CASH (or contra ETF for the more aggressive of you).  My contra ETF positions that are tied to this timer are up just under 1%, having given up a good portion of their gains with the action on Wednesday.  It does appear that we're in for increased gains at the open -- we'll have to see what the day holds.

Elder's 13d Force Index has moved back to the Long side because the 13d FI is greater than 0.  We're obviously on the threshold, having experienced a whipsaw, so caution is advised.  Although the 2d FI is negative, signaling a good entry into stocks if they individually show strength above Wednesday's high, I do think we need to be very careful here because the slopes of the 13d and 34d are heading down, not upward.  Entry into the long side at this point is risky by all of Elder's measures, and for the more conservative of you, I would seriously consider sitting pat.

The slopes of the pricing EMAs are all pointing downward, which is bearish.


Trading Plan for Thursday

No changes.  I will continue to hold my contra ETFs, which are just floating around their 20d EMA.  I'm a bit concerned that the 20d EMAs of the individual contra ETFs are all starting to trend downward, so this bear is weakening.


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