Monday Market Breadth - Mega Rally Edition
Some aspect of my chart are bullish, others are bearish. Â Unlike last week when breadth was extended too far to the downside, the proper course of action is a little less clear.
On one had, price is bright green indicating very bullish breadth conditions. Â We got a buy from the weekly in pane 4 on Friday. Â We closed above 1073 area and 1081. Â On the other, today’s reading wasn’t as high as prior > 2% rallies (but in line with other bullish accumulation days). Â The sharp spike up in the oscillator (pane 3) has a higher chance (my observation) of mean-reverting than a gradual shift into green (or a less ambitious spike off the get-g0). Â That element of mean-reversion coupled with 6 consecutive higher closes makes me wary. Â So we’ve got bullish conditions, light breadth, and a possible mean-reversion scenario in play (admittedly this was called on Friday, and was utterly wrong), but the condition persists all the same.
Obviously the trend is up, and although there are some critical levels around 1064/1045, it’s not until a break of 1010/980 that the real picture begins to change.
Howdy
indeud
Your indicators are lining up very well with the PPT hybrid calls. This is an excellent, complementary tool to the PPT.
Keep up the great work.
thanks MJ. worth noting that the extended breadth in pane 4 doesnt always mean an all out reversal, it can also mean consolidation for a few days that leads to lower prices (see last 5/6 instances)
This carry trade is seemingly random, so just buy everything dude. One thing’s for sure–big fellas sittin back today watching the little guys bid it up.