Wednesday, January 26, 2011

Bullish signals are here, by the thinnest of margins...

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Summary
  • The GGT LCR rose +4%, causing the short-term LCR change timer to move to LONG.  I did not move into VTI at the close, as the ADV/DEC values were nearly 1:1 at the close, making the ability to predict the LCR change for the day very difficult.  Moving into VTI, QLD, UWM, etc. early in the day would be allowed under this system.  +4% is a thin margin of increase; I would have liked to see a much higher change.
  • The GGT Price Index FELL -0.07% on Tuesday, another slim margin, showing just how close to walking the line we are overall.  We'll need a significant follow-through day, in terms of alignment of the LCR and the price index, to convince me we're out of the woods.
  • I did not chase DTO yeterday, as it kept moving upward.  In fact, all the contras I watched for entry moved against my buy-limit ceiling, preventing me from entering.  Today looks to be an up day on the markets, allowing the price to come back down in range.  If the markets rally and then pullback, the contras will dip then move higher, and this could present a great entry opportunity.
  • We are still very early on Contra ETFs, but there are a number that are moving upward.  A simple Elder Force Index (13d) scan will help you identify these opportunities; here are the ones that I am watching:
  • EUM
  • EDZ
  • DDP
  • EEV
  • DTO
  • SZO
  • SCO
  • BOM
  • ZSL
  • GLL
  • BOS
  • DZZ
  • DGZ
I'm on a plane most of the day today from the west coast, so my ability to trade will be severely curtailed.

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Remember, you are responsible for your own trading decisions, and I am not.  Please do your own work and take responsibility for your actions.

Regards,

pgd