This puts this rally in uncharted territory, which is always a little bit of an uncomfortable place for me. A FTD could still occur, and just because we have had a strong 9-day rally does not mean a bull market has already been missed. But one purpose of the FTD concept is to help in identifying market bottoms. If we are already at a 50-day high, then I would say this is one case where the FTD has let traders down in try to identify that bottom.
Note: There was a 1% FTD in the Russell 2000 last week. I do not look at the Russell 2000 for FTD purposes. My studies have always looked at the Dow, Nasdaq, and SPX. The Nasdaq goes back to 1971, and I wanted to be sure to include that index initially. The Russell only has history back to the mid-80s. I feel consistency is important when testing and therefore I only look at those 3. IBD and others may sometimes look at additional indices. For consistency in testing, I don't. And this is the 1st rally where none of those 3 have registered the FTD before hitting a 50-day high.
3 comments:
Rob-
I like that you're comfortable saying something like "this rally is in uncharted territory, which is always a bit of an uncomfortable place for me..." rather than feeling you have to rush in and define a situation just to show expertise.
What is that saying about "..no old AND bold traders..?"
It is also a 50day SPX closing HI under the 200 day SMA, and price is near the top of the std Bollinger band at the close. After an explosive rally but on questionable light volume...
Certainly gives one pause..
Rob,
I never understood why you gave the follow through signal so much weight in your blog.
I have read all your studies and it is not one of the most impressive ones you have shown.
But nevertheless I like this update.
Cheers!
Long Term View of Debt and GDP
We are way, way above the long term trend-line, and usually these huge overshoots result in an overshoot to the other extreme.
Thanks to Comstock for the original chart, the irreverant stuff is by me.
http://www.comstockfunds.com/default.aspx/MenuItemID/139/MenuGroup/Home.htm
Don't know your past, don't know your future.
http://oahutrading.blogspot.com/
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