1. Breath is weak, and has been getting weaker, as happens before the end of a bull market. The NYA closed below the 200 day and will have resistance above now. The RUT closed barely above. The NYA and other indices have large H&S patterns. The $BSE has a target of at least 16,000 (IMO). And Gold as been on a tear. Also, short-term, we are now entering the down phase of the moon cycle. New moon is here; we are headed for a full moon. This indicates further bearishness to come.
However, before a bull market ends, sentiment is usually very positive. We haven't had very positive sentiment since March or April. Of course it's possible that we are already in Wave 3 of the bear market, and March/April was a top.
However,
2. A few indicators indicate that we made a short-term bottom today (or will do so Monday/Tuesday). These are divergences on 5 MA and 10 MA of advancing stocks on the NYSE and on New Highs (positive divergence in New highs but not yet in New lows. The Russell printed a hammer.
3. A few other indicators (VXW:VIX) also indicate a bottom, perhaps an even longer term bottom.
4. At this point, I plan to go long on Monday or Tuesday. I will be careful with longs. Whether we are in a bull market or not, I think we get a bounce here or Monday. After the bounce, I will likely check out and consider going short.
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