- My best guess for the timing of a top would be at options expiration this Friday. Strong trends have tended to last through option expiration and reverse afterwards. In addition, Citigroup reports earnings the day after options expiration and the government will likely start selling shares once those earnings are reported. Additionally, once companies report earnings we should see a pickup in secondaries. The heart of earnings season roughly coincides with expiration.
- Positive seasonality lasts through the first few days of May. My sense is that the market is too extended to make it that long without a correction but that is a worst case scenario for the bears, in my opinion
- Sentiment is so stretched that a top can happen at any moment.
Three Possibilities For Timing A Top
As readers know I am expecting a major top to be put in during the next few weeks. I currently see three distinct possibilities for the timing of a top