What it means is the overall p/c is mocing higher. VIX and other are higher too, but not showing fear yet.
We also have the class of more informed investors (i.e., SI posters) jumping on short here.
We had capitulation-style numbers in breadth on Friday (9-1 down volume!), but the volume was not high enough to be called capitulation.
Rydex is showing a bearish slant now.
Sentiment surveys were bearish (i.e., too many bulls, too few bears) last week, but they were taken mid-week.
So, the train has left the station and, in the normal course of events, would continue on down for a little while, say Monday, maybe even Tuesday's open. However, unless we are going to crash, I would be watching for:
1) An Elliott count that could be complete off the top.
2) Either breadth improving even through we continue down or capitulation volume.
3) All p/c's continuing up as late shorts pile on board. They need not get to extreme levels, just higher than where they are now imo.
4) If we think we are close to a bounce based on 1-3, then looks for non-confirmations -- something like new lows on the DOW, but not confirmed by BKX, etc.
A bonus would be the major indices testing some good support, but that doesn't always work out. Man, reviewing the charts this morning I see we are poised over some nasty air pockets.
I am watching two non-tech charts oh so closely. RUMX gave up the large wedge, but looks to have held it on the weekly. I've been going on about GE for two weeks now and I continue to think it's headed to the crapper -- we'll see by the end of this coming week.
Remember the MSFT poll I posted after the court decision? 90% of 5000 respondents said it was a buy or a hold. Duh! ROFL. Time MSFT and GE and you will be a step ahead on timing everything else.
Finally, I think anyone who makes decent money from the market should carry insurance in the form of BK Puts. You will *not* be able to time it when it comes.
Cheers |
