3/29/2023W  New UPTREND signaled by Follow-through Day/Nasdaq +1.8% on +21% volume. I will BUY THE QQQ at Thursday OPEN

3/29/2023W  New UPTREND signaled by Follow-through Day/Nasdaq +1.8% on +21% volume. I will BUY THE QQQ at Thursday OPEN

THE MARKET’S MESSAGE:   Time to buy the QQQ and positions in rising stocks!

What is the QQQ?

The QQQ is a bundle of the 100 largest non-financial stocks in the Nasdaq. (Note the last letter of Nasdaq is “Q” – thus the QQQ ticker.)

Historically, the QQQ has outperformed the Nasdaq, which has outperformed the S&P500 overtime (but not every year). And one more note: The S&P500 has beaten the DJIA return over time (but not every year.)

And even better, here is a 20-year look-back at the QQQ versus the other indexes.

For a “Buy& Hold” investment, the QQQ is a strong idea.

 But beware:   The QQQ usually outper forms these others indexes in rising and falling times. That means to hold the QQQ in a falling market means your holding will likely fall more than the other indexes.  

On the American Exchange, the S&P500 and the DJIA indexes are considered indicators of how that exchange is moving.

Here is the comparison of the major market indexes’ growth in 2023 (shown in Monday’s column):

·      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) again indicating the Nasdaq100 (QQQ) is the place for my trend-following investment.

‍

Every day in this newsletter, I also look at how the Nasdaq, S&P500 and DJIA moved that day and include information about the volume of each index. Tuesday was a “small move’” day with lighter volume.

Next, I include the MARKET ACTION (Nasdaq) OVER LAST 20 DAYS table below (it covers about a month of trading).  Notice the number of rising (green) days, especially the 6 rising days in the last 10 days. This change  in market personality indicates the buyers are now jumping into this market.

What’s missing over these four weeks??  Not one of those rising days had higher volume. Without higher volume, the market is saying it is NOT convinced the Downtrend is over.

‍

‍

Even though Wednesday’s volume is higher than the 3 days before, it is still belowits 50-day average. The Nasdaq’s upward strength is in question. (Note the lighter volume this week and last.)  

The Accumulation/Distribution table shows total of A and B rated stocks seems to have found support at 33%.

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.

Note: there is no difference between the meaning of the 2 greens. In the Word program, the 2 colors are indistinquishable. They both refer to a rising rating.

Are you holding onto stocks that you like in spite of their weak chart action? Not me!  Cash is always a safe alternative. But note 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 holdthem. But please keep a tight rein on them.

Remember: Stocks usually fall faster than they rise!

==================

Wishing you, “Many Happy Returns.”

CharlotteHudgin, The Armchair Investor,  (214)995-6702

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

2023 ACI NEWSLETTER sent via WEBFLOW

‍

‍

‍

CHARLOTTE HUDGIN

‍