2023-10-16M UPtrend Day 7 – Nasdaq rises 1+% to 50-day average price on Higher volume! S&P500 rises 1.1% on lower volume

October 16, 2023

2023-10-16M  Uptrend Day 7 – Nasdaq rises 1+% to 50-day average price on Higher volume! S&P500 rises 1.1% on lower volume

The Uptrend remains uncertain Both the Nasdaq and S&P500 haven’t broken significantly above their 50-day moving average lines!

The Nasdaq continues to ride its50-day line which, unfortunately, is slowly falling.. The Nasdaq does continue to out-perform the S&P500 which is outperforming the poor DJIA.

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Note: IBD is offering a very timely FREE seminar tomorrow:

·      SMARTER SELLING STRATEGIES on Tuesday, October 17@ 1:30 p.m. central time (of course, you can join IBD seminars from any time zone.) I don’t know if you have to be a subscriber to qualify.

 

·      You may have to call them (to get a registration link.  When I put my link in, their system thinks I am trying to register again. If you are a subscriber,registering should be easy when you type in the name of the webinar.  If not, please call them at directly at

 

What happened on MONDAY??? A good day for the Nasdaq – a Major Accumulation day!

Although the Nasdaq is 5.5% below its June 2023 high, the major index has risen 4.4% in the last 2 weeks and is now stalled at its falling 50-day line.

I am cautiously holding my QQQ position.

The following section is a repeat of the weekend,  It struck me as the appropriate analysis for this market which has dipped twice recently

FROM THE WEEKEND ARMCHAIR INVESTOR NEWSLETTER: a GOOD LESSON IN MANAGING YOUR PORTFOLIO IN A SLOW DOWNTREND.

“As you follow the Nasdaq’s moves in the chart above…, since the July high, the Nasdaq has dropped twice and recovered some of those losses before diving again over the last 2 days.

TAKE NOTE:  The above chart shows you how many downtrends form.  They don’t just drop,drop, drop.  They drop some….. then other traders may see the lower price as a bargain and jump in…. pulling the price back up.  Repeat.

Thus since the middle of July, we have had 2 downtrend periods and 2 partial recoveries.  And “partial” is the keyword here. Since the high near the start of August:

·       The 2 lows were “lower lows” and the highs after those lows were also “lower highs!”

·       Traders sometimes say, “The market fell lower and lower with the traders fighting it all the way down.”

But look closer at the volume on the price recoveries (rises.)  If you examine the  volume on the recovery days, you won’t see higher volume on the way up. That is a HINT that the OVERALL PUSH IS TO THE DOWNSIDE.  

The last high is not yet a “high.” It will be a high if the Nasdaq price continues down.  But no uptrend goes up every day….. and no downtrend goes down every day:

·       Do you see the aspect of the Friday price move that warns that Thursday’s high may have been the start of dip number 3?

Answer: Friday was a significant dip (-1.2%)which closed near the bottom of the day. That drop is where the traders went when faced with 2days of not being able to trade (Saturday and Sunday.)

BOTTOM LINE FOR ME ON THIS MONDAY:

Since I have recovered about half of the Nasdaq drop off the July high, I am feeling hesitant to hold my QQQ if they can’t hold above the 50-day moving average line.

         Idea 1)  If this second recovery since the July high continues to rise, I’ll stay in the QQQ and could move back into the TQQQ.

Idea 2) Sometimes CASH is the best position. I am watching out for another dip in the QQQ to tell me to step out to cash.

Note:  On my tables like the one above and below, you will see the red boxes have white lettering in them. Why?Because RED is a “fully saturated” color which means if you printed this presentation out on a black and white printer and I had not turned the numbers white, you would simply see black letters on black boxes. If that doesn’t make sense, call me or your printer-savvy friend.  

Now look below at the NEW UPTREND on the MARKET FACTOR, COUNTS &RATINGS table below. Wow! look at all the green!


 

>>> CAN YOU SEE THE UPTURN IN THE STOCK BUYING OVER THE LAST 2 WEEKS? The count of A and B rated stocks rose from 24% a week ago to 28% Friday. (a mild upturn.) I am NOT EXCITED about a new Uptrend,yet.

When the number of stocks with A or B ratings rise, I know there are more buyers than sellers and money is flowing into the stock market.

But Friday’s 4% increase is not enough to get excited……yet.  And Mondays1.1%rise in the QQQ was pleasant, the QQQ still sits on its 50-day line in a 5 day sideways huddle!

Stay tuned!    

Those birds just aren’t going anywhere!

One additional “Word to the Wise”…

>>>>>--- MOST MARKETS FALL FASTER THAN THEY RISE so give this market some time to reclaim (and beat??) its prior highs.!  

Please send questions, comments,suggestions, ideas and requests to:   My text message account at(214) 995-6702.

Wishing you, “Many Happy Returns.”

Charlotte  Hudgin, The Armchair Investor,                                              

www.ArmchairInvestor.com   (214)995-6702   

2023 ACI NEWSLETTER sent via WEBFLOW

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