JAN 7 INDEX UPDATE
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Short-term technical readings:
DOW - lower midrange
SPX - lower midrange
OEX - lower midrange
NAZ - lower midrange
NDX - lower midrange
VIX - upper midrange(inverse to market)
CBOE PUT:CALL RATIO - .63
5 DAY TRIN - 7.98
Per my short-term technicals the overall market is in the lower midrange and if it was to continue down I would get CLASS 1 SELL SIGNALS in 2-3 days, So TUE/WED appears to be the short-term bottom is the market continues down.
As mentioned in my previous index update, the 5-DAY TRIN was very high, and continues to stay high, near extreme levels. Readings at/above are short term buy signal, so with a reading 7.98 it is clearly in buy territory. It is not uncommon that the 5-DAY TRIN readings stay in buy of sell territory for a few days before the short-term reversal starts. From the best of recollection, I recall 3-5 days as being the most, be a short-term reversal. For the last 4 trading days, the 5-DAY TRIN has been above 6.00. So, although the overall market is not yet in CLASS BUY territory, these high TRIN readings could produce some sort of a bounce/rebound at anytime.
I am still holding onto my position that the improvements in the NAZ market internals are implying that a bottom was set. I had previously mentioned that I did not feel that we would get a retest of the previous lows since a HIGHER HIGH was set, but in light of the recent heavy selling it is now a possibility. If the NDX/NAZ does continue to drop for a clear retest, I suspect that such retest should be successfull, nevertheless I will not ignore the possibility that new lows could be set. Although for now, I feel that is less likely for immediatecy. If the market internals reverse dramatically in a negative direction, then I would need to review my position.
Per my personal and our website mutual fund accounts, I have been adding small UOPIX(long-NDX) positions - again just small ones. Please also keep in mind that we are about 78% cash(website) and 65%(personal), so we have plenty of buffer if wrong. I have also been 100% invested in my trading account(less than 10% of all my funds) in small caps(1 biotech/2 hitechs) over the last few weeks. Already took some profits and will continue to add. |
