- Since the market peak on 2/18, the GGT price index has fallen -6.5%. In comparison, the dip after the 11/8/10 peak was -10.4%, but the 1/18/11 peak to subsequent drop was only -3.90%.
- Wednesday's action saw the GGT price index fall -1.33% on volume that was 33% above average. This was a significant day down, and it caused many stocks to move into a CASH recommendation.
- The 34d pricing slope has now turned downward. This is the first time that this has occurred since 11/16 & 11/17, and during that period, it only lasted 2 days. If we are to recover, I would expect that this will move back to the upside very quickly. If it does not turn up, then I will maintain my bearish outlook.
- My pricing change tool that I use to determine reward/risk levels is pegged against the bottom rail at -14, indicating a great reward/risk on the long side and that I should move into stocks aggressively on the long side. This is a day-over-day tool, so in no way is this telling me to open new positions for any duration of time. My overall outlook on the intermediate term is bearish.
- The Long-Cash Ratio (LCR) Change Timer, which is a short-term timer, is solidly in cash.
- The Elder Force Index timer, which is an intermediate-termed timer, is solidly in cash.
- GGT database strength has just notched it's 6th contiguous day of dropping, the first time it has done this since August 2009 (yes, 2009), and is well overdue for a bounce to the upside.
- The LCR has dropped to 0.305, the lowest level it has been at since 8/26/10, when it dropped to 0.300. This is an incredibly low level.
- The slopes of all the LCR EMAs are pointing downward, and the day-over-day change of these slopes has been negative for three consecutive days. Three consecutive day-over-day changes to the downside means we're running really fast into oversold territory, and a 4th day of this pattern is rare (11/9 - 11/12 inclusive, 10/14 - 10/19, 6/21 - 6/24, 9/21/09 - 9/24/09 ...). I would expect a bounce upward either today or tomorrow, which is quadruple witching day. Until some of these slopes start appearing to move to the upside I will maintain my bearish outlook on the market, and will keep a high degree of cash.