And just like that, they declare “confirmed uptrend”…
Nasdaq and S&P 500 hit new highs for the year, as number of distribution days shrinks a bit.
This could mean the the distribution count was around 6, which is borderline, but as time passed without new dist, they fell out of the time window and don’t count.
Currently, 4 distribution days on Naz and S&P.
On 4/12 they said this
Distribution days increase as the Nasdaq composite struggles to make decisive move above 200-day moving average…
and
Just when the market uptrend was teetering, buyers came in to prop it up and keep it going at least one more day. The Nasdaq rose 0.8%. It not only made a bullish price reversal but it also climbed back above the 200-day moving average. The composite has yet to firmly establish itself above that line; buyers and sellers have skirmished around it for a couple of weeks…
With the big move the other day, we are nicely above the 200dma now, however volume was just above average. Big oil meeting Sunday that could move the market with a big change in the status quo (not likely in my mind).
“Confirmed Uptrend” means the probability of success is much higher, but you must buy breakouts of strong growth stocks in proper chart patterns. (If following their “rules”).
For us it could mean reducing any cash positions and add to growth stocks we love.
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4/18/16
Indexes hit new highs for 2016 and the number of distribution days lessens a bit…4 each on Naz and S&P…
Volume on the Nasdaq rose from Friday’s levels. NYSE volume fell. Volume Friday was below average but skewed somewhat by options expiration…
Volume on the Nasdaq rose from Friday’s levels. NYSE volume fell. Volume Friday was below average but skewed somewhat by options expiration…
Once again, growth stocks showed signs of life with the IBD 50 up 1.1%. Universal Display (OLED) did the heavy lifting in the IBD 50, up nearly 8% in more than double-average volume. Advancing stocks outnumbered decliners by nearly 3-to-1 on the NYSE; the ratio was nearly 2-to-1 on the Nasdaq…
there’s more to like about underlying market health than not to like. A quick scan through several growth-stock screens shows no shortage of stocks in bullish setups, and many more trading tightly and holding gains post-breakout. Many stocks, though, have made modest progress from buy points…
When it comes to market technicals, the overall picture looks pretty good. The Nasdaq shows four recent days of bullish price action: March 29, April 1, April 12 and April 13. The first three were upside reversals in higher volume. The last one was a gap up that resulted in the resumption of the market uptrend.
Meanwhile, a weekly chart for the S&P 500 shows two recent accumulation weeks: the week ended March 4, and the week ended March 18. Accumulation weeks are good to see when a stock or an index gets into position for a breakout try.
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4/19
The S&P 500 finished above 2100 for the first time in 2016. All throughout last year, the large-cap benchmark had supreme difficulty mounting a meaningful advance past that milestone…
Volume jumped on both major exchanges, which meant that the Nasdaq chalked up a fifth distribution day, or bout of heavy professional selling. That’s not the kind of day an investor going long wants to see, especially after the Market Pulse’s current outlook saw an upgrade on April 13 to “Uptrend resumes” from “Uptrend under pressure.”
There are two more reasons why investors should consider very carefully if they want to be aggressive buyers. One, earnings season is adding to the market’s volatility, even if the CBOE Market Volatility Index (currently near multi-month lows) does not show it. Just look at Netflix (NFLX) (down 13% Tuesday in volume 260% above average), Illumina (ILMN)(-23%, volume 821% above normal) and IBM (IBM) (down 6%, volume up 172%), all of which scored weaker than expected results or light guidance.
None of these three former big winners have finished completing bases or triggered proper buy points. Even Netflix, which had climbed back above the 200-day moving average last week, was still 16% below its 133.27 peak. IBD’s study of the greatest stock market winners going back to the 1880s shows that in most cases, a stock is primed to break out after it has rallied to within 5% to 15% of its 52-week or all-time peak. So the CAN SLIM investor who is following all the rules for selecting growth stocks would not have been hurt by their sell-offs.
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