This morning I became more skeptical of the rise in the S&P 500 while watching gold take a $60 nosedive, so I decided to sell my largest position - which also had a modest gain - and head towards the sidelines. This is a daily chart of Claude Resources Inc (CGR) which I sold for $1.47. I will continue to hold a substantial position of CGR in my retirement account as I am very persuaded, for now, that this company has both excellent earnings prospects and long term value.
My TSI trading record has been updated.
The list of 20 short/SELL trades, based on the True Strength Index (TSI) indicator's negative divergence SELL signal has been updated to include today's closing trade. It turns out that 57% of the NYSE stocks closed lower today, while 75% of those stocks I listed also closed lower. If you would like to review that data, click here, then scroll down the page a bit to reach the data table.
A couple of readers have written me to inquire about the possible short sale of particular stocks that seem to meet the TSI negative divergence SELL signal criteria I imposed upon myself. I would like to share those with you now and try to clarify why these two stocks were not viable candidates of the negative divergence rules I applied to my selection.
This first chart is a daily of Autodesk Inc (ADSK). This is an excellent example of the trend line break BUY signal trumping the otherwise obvious negative divergence SELL signal.
And the next chart is a daily of Salesforce.com Inc (CRM) - also an excellent example of a trend line break messing up an otherwise legitimate negative divergence.