the bottomSince the market bottom of  March 2009, we have only reached this level of oversoldness just three other times. That’s right, just THREE TIMES. 

Whether you shorted this market from start of this year or not, this is not the time to start getting bearish. You’ll see from the T2108 (% of stocks trading above the 40-day moving average), that this is the place where the market bounces hard and fast. I’m not talking we stay this oversold for a while and eventually get around to bouncing, I’m saying that when this level is reached it is nearly an immediate bounce that follows. 

That’s why you won’t see me shorting this market at this time. It is a high, high risk trade that is not worth going after at this time. 

Here’s the T2108 Indicator:

t2108 a bottom is forming

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