4-25-12 comments

If the S&P500 or NYSE Composite closes up 1.25% or more we should see IBD put the market back into a confirmed rally. NYSE volume is running at a higher rate so far today with 45 minutes remaining in the day. The NASDAQ action does not count at we are too close into the bottom. A Follow-Through day needs to be on day 4 or later in a possible rally. This not calling a FTD close in to a bottom is because short covering often masks real buying intent.

I sold GNC today as it looks like a possible climax run. Climax runs can be spotted when you see the largest weekly spread since the beginning of its advance and that climactic activity is 18 weeks or more from a first stage base breakout or 9-10 or more weeks from a later stage breakout. GNC is 26 weeks from a second-stage base breakout. Some call the move today a buyable gap up. Since it gapped up through an upper trend line I chose to view it as a climax run and voted at my broker with a sell order.