(T2108 measures the percentage of stocks trading above their respective 40-day moving averages [DMAs]. It helps to identify extremes in market sentiment that are likely to reverse. To learn more about it, see my T2108 Resource Page. You can follow real-time T2108 commentary on twitter using the #T2108 hashtag. T2108-related trades and other trades are occasionally posted on twitter using the #120trade hashtag. T2107 measures the percentage of stocks trading above their respective 200DMAs)
T2108 Status: 57.9%
T2107 Status: 26.8%
VIX Status: 18.4
General (Short-term) Trading Call: Neutral (target of 1996 on the S&P 500 has already occurred ahead of overbought conditions. See “From the Edge of A Breakout to the Ledge of A Breakdown” for more details).
Active T2108 periods: Day #4 over 20%, Day #3 over 30%, Day #3 over 40%, Day #1 over 50% (ending 95 days under 50%), Day #113 under 60%, Day #318 under 70%
Reference Charts (click for view of last 6 months from Stockcharts.com):
S&P 500 or SPY
SDS (ProShares UltraShort S&P500)
U.S. Dollar Index (volatility index)
EEM (iShares MSCI Emerging Markets)
VIX (volatility index)
VXX (iPath S&P 500 VIX Short-Term Futures ETN)
EWG (iShares MSCI Germany Index Fund)
CAT (Caterpillar).
IBB (iShares Nasdaq Biotechnology).
Commentary
It has been a whopping 95 trading days since T2108 last traded above 50%. Could a trip to overbought conditions, something unseen in now 318 days, be right around the corner?
T2108 surges again in what has become a V-like bounce from oversold conditions
T2108 was last at current levels back in April. Those were the days when the S&P 500 (SPY) was still making new marginal all-time highs. Now, the index is bumping up against its downtrending 50-day moving average (DMA) for the first time since the big breakdown in August.
The S&P 500 makes its highest close of the post oversold period
