Archive for December, 2022


December 10th, 2022 Comments off
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The stock market appears to have completed its Bear Market rally from the October lows. Don’t be surprised if those October lows are tested in the coming weeks with either a low-volumn Dow Theory non-confirmation or a climatic high-volume crash to occur. In most cases, this would be a good time to step aside and let the market set itself up for a better opportunity in late December or in the January/February time period. This is a tricky time in the market where a Bear or Bull can easily lose money and/or sleep!

Key underlying short-term timing indicators show the following:


NYSE McClellan Summation Index: This index’s oscillator has a current reading of 76 and trending down. This indicator is starting to cluster now after a big run-up since October. The cycle of this indicator would suggest that it is now time for the market to head down for a number to weeks before clustering again to form a stable bottom.

Fear/Greed Index: This popular indicator is in the “Neutral” territory with a reading of 54 and trending down. Having been in the “Greed” range for many weeks, it looks like this indicator is heading back towards the “Extreme Fear” area that is required for a good bottom. The trick here is to be patient enough to see a reading in the “Extreme Fear” range, but on the lookout for the deep bottom move to the under 5 reading of major bottoms. This is always a distinct possibility.