Below is a short excerpt from Tuesday night’s Subscriber Letter which addresses Frank’s concern and provides more detail on the setup. It’s fairly common that I include additional information on studies in the Subscriber Letter, and this was one of those instances. As a refresher, the setup involved a 1.25% rise in the S&P 500 and a close below 25 for the Quantifiable Edges Spyx reading.
This setup has been especially bearish during the current bear market. Below are all instances since October 2007 along with their 4-day returns:
Ten for ten to the downside in this case.
1 comment:
Off Topic -
I noticed that my Bloomberg application on my iphone showed that 35 out of 35 stockmarkets world-wide went up yesterday....
That's 7 stock-markets in the Americas, 18 in Europe/Middle East/Africa and 10 in Asia and Pacific.
I don't know if anyone monitors anything like that but I just guess it is some sort of 'breadth indicator'?
My hunch is that that is bearish. 35/35 going up suggests (to me) that some sort of psychology measure is at an extreme.
Wish I had some sort of data set on something like this.
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