I’ve been at the Boardwalk Arts Show in Virginia Beach where my wife is selling art this week. Sales have been much slower than last year.
They have had router issues here at the hotel so I haven’t been able to post or check NYSE data to input into the model. Today they got things up and running again.
While the Navigate the Stock Market system has been calling for a Sell the past couple of days, a review of the volume and market internals shows that we had a successful test of the 1257 low on Thursday. That’s because the Thursday-close of the S&P 500 was within 1% of 1257 (the prior low); and the S&P volume was only 66% of the volume at the low; and market internals were improved. Traders saw it too and we had an up day on Friday on relatively high volume (30% > the 20-day moving avg. vol.).
A successful test means we should buy.
We also got within 1% of the 200-d MA.
The NTSM system moved to HOLD on Friday so we could have called a buy Friday, but I didn’t have the data…oh well.
We still have a the same choice though: (1) Buy now or ; (2) wait for the NTSM analysis to give the buy signal.
Last year the Volume analysis called a Buy on a successful test about 5% above the final low of the correction. The NTSM analysis called the bottom to the day. Unfortunately, it is really only a guess which way of looking at the market will give us better results this time.
Normally, I would expect a big up day Monday or Tuesday. News is still very unsettled though and that could dampen spirits. Monday is certainly a trading Buy so I may go 50% in. It is no longer the right climate to be 100% invested. I suggest more caution and a more conservative investing approach.
NTMS is HOLD as of Friday, but volume analysis shows a Buy.
I plan to move some $ back in Monday, but it will be limited in scope.
