Professor’s Comments September 29, 2015
Posted by OMS at September 29th, 2015
The Dow fell 313 points, closing at 16,002. Volume was heavy, coming in at 113 percent of its 10-day average. There were 5 new highs and 493 new lows.
It appears that the market has entered an impulse wave down. I’m still not sure if this impulse wave is Major Wave 3 down or wave 5 of major Wave 1 down, but it really doesn’t matter for now. We should be going a lot lower.
Last night The Professor had 121 shorts, a new record for the algorithm. Let’s put this number in perspective. Since the Fed announcement, The Professor has had 96, 113, 48, 51, and now 121 shorts. The previous high for shorts identified by The Professor in the past 5 years was 28! Clearly something different is happening now.
Think back to 2013, when the Dow was in a trend mode and The Professor was highlighting 50 or more stocks to the long side for us. He didn’t just identify one or two of the rallies, no…he caught them all. But now he’s highlighting lots of shorts. This is just another reason why I believe we have entered a Major Bear Market.
Both of my trend indicators have moved into the trend mode, so until the down trend is over, I will continue to hold my positions in inverse index ETFs.
Yeah, there will be bounces along the way down, but they should be small. Yesterday the A-D oscillator had a reading of -147.77 which tells me the market could see a bounce today. The bounce could retrace about 100+ points on the Dow, maybe 15 points on the SPX and take it back near 1900. I would view any bounce now as a shorting opportunity.
My next target for the current decline is a re-test of the 24 August lows near 15,370. Right now I’m still looking at a Major Wave 1 bottom below 15,000. But IF Major Wave 3 down is underway, the decline will likely be a lot lower, probably between 12,500 and 14,000.
Riding the horse lower.
That’s what I’m doing,
h
Market Signals for
09-29-2015
DMI (DIA) | NEG |
DMI (QQQ) | NEG |
COACH (DIA) | NEG |
COACH (QQQ) | NEG |
A/D OSC | |
DEANs LIST | NEG |
THE TIDE | NEG |
SUM IND | NEG |
Not sure of the terminology we use? Check out these articles
The Hockey Stick Pattern
The Creation of Waves and Trends
FAQ
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Category: Professor's Comments