Monday, June 7, 2010

GGT Weekend Update, Posted early Monday 6/7

.


Status:
  • LCR Change Timer:  Signaled long on 5/27, remains long as of 6/4 close, but has transitioned to LONG-CASH (0).  If Monday is a DOWN day as far as the GGT database is concerned (watch FinViz ADV/DEC) then this timer will transition to CASH (-1).
  • GGT Price EMAs are bearish again.  All but the 65d EMA are below their faster values, e.g., 55d > 34d > 21d > 13d > 8d.
  • GGT Price ($23.27) is trading BELOW the 8d EMA ($23.88), which is bearish since all of the EMAs are inverted.
  • GGT Price ROCs all turned down with Friday's action, which is bearish.  All are negative, which further nails the coffin shut.
  • Slope of 65d EMA of GGT Price is negative (bearish) and reversed, now pointing downward (bearish).  This is the wrong direction.
  • GGT Volume was +2% higher the 50d MA, but this is within a normal distribution (neutral).  We are seeing less participation in the market, which I consider bearish.
  • Elder's 13d Force Index on the GGT Price continues negative (bearish) @ (471K) but is holding this relative level, which I consider mildly bullish.  We'll see.
  • GGT Long-Cash Ratio (LCR) fell from 0.291 to 0.210, which is short-term bearish.  It has dropped below it's 4d SMA, which I consider bearish.  We need a strong up day or this trend will continue.
  • GGT LCR EMAs are all inverted (13 < 21 < 34 < 55) and with Friday's action, are all pointing downward.  The database is struggling on the long side.
  • GGT LCR ROCs are all negative (bearish) and are pointing downward.  This is problematic.
  • GGT Strength Index dropped dramatically from 0.57 to 0.19, and is below my less-than-scientific 0.2 threshold.  When we are this low the market favors a bounce upward on a short-term scale.
  • GGT Equity Curve based on the LCR Change Timer dropped dramatically from $2.5080 to $2.4017 with Friday's action.  The day-of-the-signal (5/27) value was $2.4812 as a point of reference, so we're down about 3.2%.  This is in the 3rd standard deviation of daily movements, which means that it is very uncommon (but obviously can occur).  Stay the course on the short-duration side.
====================

Let's take a look at the GGT Universe of stocks through the lens of HGSI.  I like HGSI because it allows you to create specific charts using any list you desire to put together.  As with all my charts, click on the image for a larger view:
































Reminder:  The GGT database of stocks is constructed such that I only pick:

  • stocks above $1
  • stocks on the three major exchanges
  • stocks with at least 100K 50d MA volume
Some obvious things are apparent with the graph above:
  1. Elder's 13d SMA on the Force Index is NEGATIVE.  We are in a down-trend.
  2. Directional Movement for the database is at 34.  I like values above 40, so we're somewhat indecisive --> risk is higher at the present time
  3. Wilder's RSI(14) is at 41.  I prefer entry into longs below 20 or 25.  Conversely, I prefer entry into contras above 75 or 80.  We're not in any position to go either way as of the open on Monday.
  4. The Money Flow Index(28) is at 35.  Values below 20 are preferred, so again, we're drifting without a good wind to fill our sails.
====================

Setups for Monday, June 7th

I am still holding LONG ETFs in UWM, DDM, and SSO, in accordance with the GGT LCR Change Timer status (presently Long-Cash = 0).  My profit targets seem out of reach right now, but we'll see.  I believe the timer, and will stay the course.

I am holding DUG per Drew's StockOwl recommendation, and will not change this today.

I will not add to my contra positions, per items 2-4 above.

====================

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

Regards,

pgd