In a month of first-ever data for the stock market, AA just wrote to inform me that,in the five years we've been tracking the bull-bear power bar ratio and other Chaikin Analytics metrics on the market conditions page, we've not once recorded a Powerbar differential as low at .01 on the SPY. There are two bullish or very bullish stocks and 135 bearish or very bearish stocks in the ETF. The Chaikin Power Gauge, which is the underlying metric for each stock in the index is quantimental model of 85% fundamental and about 15% technical data. Power Bars this low do have a tendency to snap back, so we'll be looking for Neutral + stocks with solid dividends in defensive categories as candidates to play any counter trend rally to the upside.
Our Market Down call using Chaikin data shifted to NEGATIVE POTENTIAL on 10/8 and to MARK DOW on 10/11. Our indicator has never been great for market timing, but it sure saved a tremendous amount of drawdown forecasting the black swan event!
Our Market Down call using Chaikin data shifted to NEGATIVE POTENTIAL on 10/8 and to MARK DOW on 10/11. Our indicator has never been great for market timing, but it sure saved a tremendous amount of drawdown forecasting the black swan event!
In a stunning pullback, we've moved all the way down to the 9+ year bull market trendline, which could act as support. Keep in mind that this is a monthly candle, and even if the trendline holds when the month ends next week, we could pull down to well below that level before snapping back. We'd expect the market to hold support and at least deadcat bounce at this level, but perhaps not before we experience a cascading downward spiral well past support before buyers step in snap us back to this level. That would produce a hammer pattern, likely with a long lower shadow given the amount of panic the market is experiencing.
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