My oversold indicator count is now 4 out of 4. I am looking for a bounce. For example, the T2108 is at 19%, heading towards an area where a bounce might occur and the put/call ratio was greater than 1.0 at Wednesday’s close. I am still in cash and a little short. Since October 8, the first day I identified a new short term down-trend for the QQQ, the QQQ has declined -8.9% and SQQQ (3X inverse ETF for QQQ) has advanced +29.9%. Since the GMI flashed a Sell signal on October 22, the QQQ has declined – 5.7% and the SQQQ has advanced +18%. Clearly the short term down-trend signal provided a better entry, but it is less reliable than the full GMI based signal (I think so but have never tested this hypothesis). The leveraged index ETF’s perform really well when I catch a multi-week trend move. However, they can reverse quickly.
Dr. Wish,
Could you please explain your oversold indicator (4 of 4). I’m having trouble following “oversold” and “first day of up-trend or down-trend” and how it relates to GMI, GMI-2, Worden T2108 and RWB chart. Thanks for your generous contributions.
Duke
My oversold indicator, short term trend count and GMI are separate indicators I use to decide what to do. These guide my short term more speculative money. I use Weinstein’s Stage Analysis to determine when to exit in my university account because there are limits to the number of trades I can do in that account. If there were no such trade limits, I would exit more quickly based primarily on the GMI signals.
While T2108 is in bounce territory, it can go lower. you might wee T2108 get down to 10 before a relief rally occurs.
I think the first question (and I) want to know (if it is not confidential) what constitutes the oversold indicator, the short term indicator and the cut points involved. Thank you for all your community service. I continue to learn a great deal from your efforts.