Both S&P and NASDAQ had greater volume and much larger gains than 1-1.25 % so yes, follow through-days.
Personally, took a new position in NFLX and added to an already positive position in PLTR. Have, and will keep tight stops. A few other small positions, encouraging. But remember that half of FTD’s fail so caution advised. We are only a social comment away from a 5+% drop at anytime someone’s hemorrhoids flare.
Lakedog
4/23/25
IBD:
Despite two days of strong gains for the indexes, IBD’s recommended exposure stays at 0%-20%, mostly because of a lack of buy candidates at the moment.
One of my difficulties with IBD has always been that they work every angle to make a buck. I don’t really deny them that as it’s what they’re suppose to do as a company. But it get’s old having a zillion ads etc thrown at me all the time. Just a couple days ago, literally on the 21st, I got an ad email for their " Portfolio Exposure Level System".
This is NOT their Market School but uses a lot of the same perspective to come up with the exposure level. Don’t confuse them. Not saying one is better than the other, just different goals in expressing interpretation. Note, Market School Rules did not increase buying level either.
Despite a strong gap up and climb today, we had a very weak closure, dropping below the 21 sma and losing about half the gain. While VIX got below 30, it’s still elevated. I took a couple test spots, but watching closely. Interesting that for several days we’ve had some end-of-day buying. Not a ton, but enough to make me wonder about the big boys & girls.
Lakedog
Today, we closed above the 21dma on the S&P and Naz, but low of the day was just below it. Progress.
NASDAQ gapped up with low of 16744.97, close 17166.04 and 21 sma 16710.30
so low did clear 21 sma.
S&P 500 gapped up with low of 5371.96, close 5484.77 and 21 sma 5389.23.
NASDAQ has a B3 buy signal of low above 21, but SPX did not. Both had good gains and would have qualified for B2 buy signals of additional follow-thru days (within 25 days of rally) but had lower volume.
Lakedog
PS Steady retail purchasing until noon, flat then up with an increased tail.
Because this built on already stout progress during the week, and Friday’s low for the Nasdaq and S&P 500 held comfortably above the 21-day line, IBD is raising its recommended market exposure to the 40%-60% level.
S$P 500 made a Buy 3 on Friday.
Both NASDAQ and S&P had nice increase but failed again for Buy 2 because of low volume.
Two buy signals for each index. Futures initially looking down. At a tough zone for support and resistance, we’ll see.
Lakedog
Naz and S&P finished above 50dma and I was thinking this would be an additional FTD, but I think vol was a littler lower than yesterday on both.
AMZN and AAPL were light on forward guidance and are down after hours. Might not hold the 50dma tomorrow, but will a good sign if we do.
That is huge. Hopefully we stay above it and the market starts performing better. RDDT is up big on their report. Unfortunately I didn’t have a cushion so I sold yesterday. Happy to see it doing good though.
At my lake house, internet has been down all day, just back up via cellular hotspot. There are several “steps” for additional buy signals. Using a weak hotspot to write this and unable to list changes. Sorry, hope to have things back up soon.
Short answer, yes, it’s all good and supports further buy signals. Apologies again.
Lakedog
Another strong day for major markets, moving farther above 50dma and near 200dma. Price change in markets was good enough for additional FTD, but once again, volume bars show slightly lower volume. Now we have two days of lows above 50dma. IBD keeps exposure at 40-60%, a third day of lows above the 50dma might take us to 60-80%, or maybe if combined with a move above 200dma. Lake will let us know the signals.
All those have not happened yet, what id Webby say about exposures, won’t he stick with the official scale?
I am 95% invested in my IBD account. That includes a 110% position in TQQQ, which is like a triple position in QQQ, so technically I am on margin. I don’t have a stop loss on it, but need to put one on before Monday.
Webby pulled back a little today because of the 200sma. He fully expects some chop so he was taking a little cash. But he also said that everyone must trade what they are seeing. All my recent trades are up and I am green on almost all of them.
I have this in my notes, but it seems wrong…
A subsequent FTD is 0.2% gain or more on heavier vol than the day before (the stronger the better). These show professional accumulation and correlate with better rallies. Heavier Vol and less than 0.2% rise is “stalling”
I would think a subsequent FTD would have same basic criteria. Did I typo the “0.2%”
Thanks.
I can’t find anything on what makes a subsequent FTD Pete. Maybe Lake has some information on it.
Pete I think a subsequent FTD has the same criteria. I think the .2% is on a distribution day.
Professional distribution, where the index drops more than 0.2% on higher volume, is a concerning sign post-follow-through day. Additionally, if the index closes below the low of the follow-through day within the first 15 days, it indicates an increased likelihood of failure.
Man, you don’t know how much you rely upon internet and cell until you get stuck in a pocket with trivial at best service for both. What frustration. Regardless, I’m back, at least for now. Astound kept saying there were no issues, but a complete outage is an issue. Of course, the only time I could contact them about it was when it was working, for 10 minutes that is……LOL. Needless to say, my positions “rode” thru the end of the week unattended but successfully.
Okay, a lot happening in the Market School perspective, let me do a quick recap and then try to fill in details. It will be brief tonight. I sincerely appreciate the helpful input from @Pddinhead and @Buyandholdisdead.
(1) I didn’t call this at the time, but Alli and Mike were commenting on what days were what on IBD Live and they called this an Additional FTD. The criteria for that is listed as “any additional FTD criteria day within 25 days of Rally day.” If you glance at it, it’s a down candle but had gapped-up and stayed above the prior day’s enough with increased volume to meet criteria. A little hard to see a lower closing candle and think positive, but obviously this worked this time. We’ve had this discussion before.
(2) While there was a lag between NASDAQ and SPX, they both crossed and closed above the 21 sma for a buy 3 signal. They matched on the Buy 4 signal of Trending above the 21 because the NASDAQ delayed a day as 4/30 was a down day and it must be flat or up to count.
(3) The Buy 6 signal, low above the 50 sma, was delayed until 5/2 as it also by criteria must be an up or flat day, yet was down relative to the open on 5/1.
I find it interesting that market school has a 5-step “buy/sell” recommendation for positions. So we are at 100% buy for those stocks in our watch list that are at the proper buy zone by IBD criteria. Note, it doesn’t mean 100% of total financial investment, just the total planned amount for positions I still haven’t found any specific discussions as to how you handle new specific stocks that arise. Do you add only as new buy signals occur or just go for the total at once or ??? Personally, I am a building as the stock indicates and proves itself. Curious if anyone has other input.
This is a quick note. While things are very positive looking, it’s not uncommon to have short pullbacks or similar to balance matters. We are also hitting against some more specific resistance not to mention the 200 needs to be bridged. Keep a balanced perspective.
Lots of catchup for me to do,
Lakedog
Thanks Lake, I am seeing 4/29 as a subsequent Follow through day also. Welcome back.
So I think it is important that we have a clear definition of a subsequent FTD.
Webby says a Subsequent FTD has to be within 25 days of the low. A subsequent FTD has to have more volume then the previous day and it must be up at least 1 percent. The more Subsequent FTD’s the more chance that the upturn is valid.
Here is a good video to watch if you can’t watch the whole video start at 1:29:00 but I think the whole video is worth watching. I watched at 1.75 speed.
It’s any day that meets the standards for a FTD in the first 25 days from a rally day from the MS info. There’s been several that have met price action criteria but not volume. I’ll take a look in more detail tomorrow but Alli and Mike also only referred to the 2 FTDs when they reviewed Friday am on live. But Webster tends to morph his volume perspective
