Tuesday, November 23, 2010

Elder Intermediate Timer is LONG

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Summary

  • As of 7 a.m. Tuesday morning Yahoo! finance had not updated their database, so correspondingly, I can't update GGT.  The move to integrate Quotes Plus and GGT thus becomes reignited in earnest.
  • Leader action for the broad market continues to outpace the contra side of the market, with an important bullish reversal occurring during Monday's action.  
  • As anticipated, volume of the DOW, NASDAQ, and S&P indices was below average, reflecting the vacation week.
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A Bullish Bias

GGT has a bullish bias; here's my chart:


























As a universe, an argument can be made that we should continue to support the long side of the equation:
  1. Bull power is significantly bullish.  This is the distance between the high of the day and the 13d EMA.  When this is positive more than the bear power magnitude the bulls are in control.
  2. Both calculation methods of the 13d Elder Force Index (EMA and SMA) are very positive, which is bullish.
  3. The MACD histogram is improving (less negative day over day).
  4. The slopes of the 13d and 34d EMAs are positive as well as pointing upward.  This is strongly bullish.
  5. %B indicates that we are at 0.76, which suggests considerable upside room exists.
  6. Prices continue to close above all the primary EMAs, which is bullish.
Cautionary indicators are:
  1. Bear power is negative.  This is the distance between the low of the day and the 13d EMA.  When this is negative the bears are gaining ground. A resounding bull appears when both bull power and bear power are positive, and this is not the case right now.
  2. The MACD histogram is negative, which means that the MACD is below the MACD signal line.  This is inherently cautionary.
  3. The slopes of the MACD and MACD signal line are negative, which tells us that over these periods (8d, 25d) that we've not been a powerfully-supported up period.
  4. The slopes of the MACD and MACD signal line are in the upper half of the MACD window, which again, suggests that we have already run up significantly so gains on the order of what we have seen since early September are not likely.
  5. Volume is drying up.  Rising prices for an index, on lower volume, is a problem for me.  On the other hand, falling prices on lower volume means that selling simply is not going on.
Overall, I continue to have a bullish bias to the markets, but I'm not playing anything significantly long at this point.  I did make trades in the short-term LCR ETFs yesterday, and will continue to play those minor positions at least until that signal changes.

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Short-Term LCR Change Timer

Because I cannot update the LCR, and cannot give an exact determination on the LCR.  Using my proxy, the www.finviz.com ADV/DEC indicator, I can guess that the LCR continued upward yesterday hence my entry into long positions should be a good bet.  I will continue to hold these positions despite the futures being significantly down as I write this.

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Intermediate-Term Elder Force Index Timer

The chart above shows that Elder's methods still point us on the long side of the equation, and the magnitude of the 13d Force Index levels tells us that we have had a signal change.  GGT's Excel method has had this indicator as being in CASH; the difference lies in the way that GGT and HGSI calculate average price and average volume.  Nevertheless, I'm calling the timer long, independent of the GGT Excel method, hence we can look at stocks through this lens.

Elder candidates that require further screening in terms of effective volume, etc. are the following:

DMAN
LIZ
HAL
XTXI
MMR
HTHT
ELP
MOVE
PSS
LBY
SPPI
HMC
APD
MDR
HHS
JBHT
DOLE
GSK
IDXX
FCT
ZZ
WAVX
PACR
FRO
DNDN
AIB

As always, enter on strength, not on weakness.  Look for prices above yesterday's HIGH (not close) and on volume that is higher than the prorated volume I discuss (look for blog tag "Volume").

I'm sitting on the side lines for the most part, list notwithstanding.

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Remember, you are responsible for your actions, and I am not. Please trade responsibly and of your own thought process.  I cannot possibly communicate all of my thoughts in written form, which places you at a disadvantage if you try to follow my moves ....

Regards,

pgd