3/27/2023M Market ends day mixed. Nasdaq Down 0.5%, S&P5 Up 0.2%, DJIA +0.6%.

3/27/2023M  Market ends day mixed. Nasdaq Down 0.5%, S&P5Up 0.2%, DJIA +0.6%.  

THE MARKET’S MESSAGE:   Low volume sideways action shows market uncertainty.

Let me start with an overview of the major market indexes this year:  

The Nasdaq has significantly outperformed the S&P500 and the Dow Jones Industrial Average indexes since the start of the year (almost a full quarter.)

This disappointing DJIA and S&P500 performance compared to the Nasdaq index may be discouraging for the new ownership of Investor’s Business Daily (the Dow Johns & Company division of News Corp.)  I hope they are now excited that they have this long-term market leader in their corral!

I will continue to pay most of my market-following attention to the QQQ (Nasdaq 100). Historically, the Nasdaq has well-outperformed the S&P500, especially if they followed this newsletter’s buy and sell signals.  And I don’t understand why serious investors even consider the DJIA. (Old habits???)

Turn to the 3+ year comparison below and even after the dip off the December 2021 quarter highs,the Nasdaq is still winning. And you have beaten the 55% Nasdaq gains if you got in and out at the signals in this newsletter.

Even with the Nasdaq’s loss Monday, it is leading since the pandemic hit.

On the MARKE TACTION (Nasdaq) OVER LAST 20 DAYS table below, notice the number of rising (green) days, especially the 6 rising days in the last 10 days. What’s missing?  Not one of those rising days had higher volume. Without higher volume, the market is saying it is NOT convinced the Downtrend is over.

What do you think it means that there are only 1 Accumulation day and 4 distribution days in the whole last 4 weeks? It certainly is not a strong statement of optimism.

On the MARKET FACTORS, COUNTS & RATINGS table below, notice the weaknesses revealed in the lack of GREEN boxes. Yes, the Up/Down 10 day count (6 up to 3 down) look encouraging. But that alone is not enough to make me buy the QQQ as a forward-looking step.

Here is one bit of encouragement. The total of A and B rated stocks seems to have found support around the 29 – 32% level. Perhaps the three week flat period in As & Bs count is a show of trader optimism after the big drop in last year’s third quarter.

ACCUMULATION/DISTRIBUTION  RATINGS of STOCKS

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Are you holding onto stocks that you like in spite of their weak chart action? Not me!  Cash is always a safe alternative. Butnote this recent broad rotation (past highly rated stocks being sold and underrated stocks being bought,)

>>>>>>>>>>>>> PLEASE READ THE FOLLOWING NOTE >>>>>  

A long time ago, (after paying for this lesson multiple times…..)  I finally learned two important messages:

1.    I am NOT smarter than the market. And,

2.    The market does not care about my “fine”opinion.

When I see the institutional investors selling hard (as shown by the drop of ”A” and “B” rated stocks, I am happy to step out of the market by selling my QQQ position.  

NOTE:  If you have individual stocks or ETFs that are holding up well, you certainly can hold them. But please keep a tight rein on them.

Remember: Stocks usually fall faster than they rise!

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 Wishing you, “Many Happy Returns.”

Charlotte Hudgin, The Armchair Investor,  (214)995-6702

www.ArmchairInvestor.com   (214)995-6702   editor@armchairinvestor.com  

2023 ACI NEWSLETTER sent via WEBFLOW

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