MARKET COMMENTARY by Woody Dorsey:
Today’s’ Sentiment is 3% Bullish. We have seen in the past that these Low sentiment days are often near price Lows of some degree. Thus shorts should be duly warned. Still, the overtly weak close yesterday and today’s weaker opening do open the door to more immediate weakness. There is now a price pattern allowing a day or more of downside. Given that today is Friday, any lack of reversal behavior today allows for more weakness on Monday. The easy break of the 2060 level infers that the next key level of 2025ish may be touched. Thus Monday/Tuesday becomes a more optimal Reversal time zone.
This most recent corrective behavior is at odds with the typical Seasonals but I had already warned that the Seasonals would NOT be typical this year. There has always been a profile for surprising weakness in For members only-join now Recent trade sets up the potential for this decline to end by early next week, be followed by recovery attempts For members only-join now (not making new highs by any means,) and then be followed by another period of weakness into For members only-join now Yes, after that Santa can come but he may not have that many presents left. This has not been as good a year for stocks as in the past. Still, the Range is well-defined roughly between 2120 and 1875. Those levels are likely to hold for several months.
MARKET TIMING: The market became overbought technically and High Sentiment signaled vulnerability. A new corrective vibration was engendered on 11/3. This is providing more overall profile clarity. Further weakness into early next week should produce decent but not exciting bounces into For members only-join now before another downside attempt For members only-join now
MARKET SUMMARY: Stocks are in the best correction since the Decline from 9/17 into 9/29. Todays 3% Sentiment after yesterday’s dramatic downtrade is confirming of a real decline but is also a typical signal that a trading Low is near. Thus, a Trading Market with better definition has reappeared.
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