Timing A Top

Many of the indicators I like to look at are showing a muddled picture. As long time readers know I like to use time rather than price as an indicator for when a rally has exhausted itself. The reason being that most market participants can only fight the pull of the crowd for so long when the market is rallying.

Six weeks is the period of time when an intermediate term move often runs into problems. Early next week is when this move will be six weeks old. However, option expiration is very often a turning point for the market, especially recently. Expiration is next Friday.

I prefer when all the indicators line up for a turn in the market. Time indicators point to a post expiration swoon. It is also possible that by that point the sentiment indicators will come around as well. At that point it is likely that the faltering economy will matter again.

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