Last week, during the shortened trading week, the SharePlanner Reversal Indicator gave us a buy signal. 

So far this week, the market is honoring that move. In particular, yesterday, when the market made a 1% move to the upside out of nowhere. 

But not all is well under the surface. There are a lot of bearish divergences unfolding:

  • VIX is spiking
  • Breadth is poor
  • Nasdaq is seeing a lot of selling, previously a market leader. 
  • On the flip side, the T2108 (% of stocks trading above their 40-day moving average) is holding strong. 

So caution is warranted in this market. Don’t be afraid to hedge your positions if necessary (I did some of that today myself).

And as always, don’t forget to follow your stop-losses (I had to do that as well today, and boy and I glad I followed them!). 

Here’s the SharePlanner Reversal Indicator:

shareplanner reversal indicator 11 29 17

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