Until the conditions can improve underneath the surface of index prices, the model is going to keep generating a short bias.
This is the fourth consecutive week where the bias model is calling for the short. Unbelievable, that’s pretty much the entire month of October. The NASDAQ composite is up 6.88% over the period, it’s best run of the year, and the model is flat out on the wrong side of the tape.
It makes me have a few thoughts—the first is that we are undergoing a shift in the marketplace which is causing my spread to stay pinned to the high side. The second thought is only a few stocks are doing the lifting which is pressuring the hybrid score.
Nevertheless, I would be remiss to ignore the bias. I will be working the short side of the tape this week. I may even initiate BIS again as I eagerly await the ultimate biotech comeuppance—an event so horrific and gruesome that minces biotech investors into little cubes of meat to be served on skewers.
Thanks again to everyone who made it out to NYC this weekend. I had a blast catching up with you guys–especially the trading conversations. A sincere hat tip to you.
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Agreed on biotech. That could well be the doorway into the abyss…for the rest of the list. Shish Kabob indeed.