Exodus’ Shortest Duration Oversold Algorithms at Shallowest Point Ever

Within the Exodus matrix, there are 4 principle algorithms, divided by time frames. The purpose of this is to ensure the engines learn how markets are behaving and to adjust accordingly.

Our shortest duration algo is 3mos. Back in March of 2016, at market lows, the oversold trigger was 2.31 on a scale of 1-5. As markets improved and volatility vanished, the scores steadily rose to reflect a market that rallied on any semblance of weakness.

Right now the trigger is 2.54, the highest 3 mo score ever, or the shallowest point in history. In other words, it won’t take much of a down tick for the system to flag OS. The interesting allegory being painted here is one that typically precedes sharp sell offs. The very essence of a calm normality is toxic for stocks. The last time the score was near this level was in late June of 2015, when it hit 2.52. Shortly thereafter, the SPY dropped from $205 to $182.

Food for thought.