AD Line Holds at 20-day Line. Plus a New “Have it Two Ways” Trade

Given the surge in bearishness, is a bottom closer than would normally be expected?

The September swoon is taking a break.  And while caution is still in order, our most reliable indicator, the New York Stock Exchange Advance Decline Line (NYAD) is still in an uptrend.  That’s great news which continues to point to a market rotation instead of a bear market.

Yet, as I noted this weekend, given the rapid rise in bearish sentiment, and although it’s not a certainty,  it would not be surprising that a tradeable bottom sets up sooner rather than later.

The U.S. Ten Year Note yield (TNX) remains below 4%, but may be tested this week as the release of the August CPI is due out on Wednesday. 

The S&P 500 (SPX) is holding above 5400, but remains below its 50-day moving average.  It has not delivered an oversold reading (RSI of 30).  Thus, we may see more volatility before things finally settle down.

We have several open trades which are showing excellent characteristics and upside potential.  And, in this issue, I am adding a “Have it Two Ways” trade, with no risk if it doesn’t get triggered but lots of upside potential if the BUY point gets hit.

If you’re a FREE subscriber, thank you for the vote of confidence.  And while this is an uncomfortable market, my indicators suggest that things could turn bullish, perhaps quickly. If a tradeable bottom develops closer than the majority expects, it will pay to have your paid subscription in place ahead of the turn, as I will issue updates as things develop.   Thus, this may be a good opportunity to become a paid sub.

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