• 734c7cd5e99abdf3c99d9bb7.png (1916×1054)

This is a chart that I don’t often publish, but I found it interesteing just how steep and extreme it is. 

The T2108 is a Worden specific chart that shows the number of stcks trading above the 40-day moving average. Only twice have we seen moves in the market that were more extreme than what we’ve recently gotten, and each time they were met with at least a short-term pullback in the markets (the rubber-band effect). The first occassion occurred in 2003 after an extended Nasdaq sell-off due to the Dot-com bubble. The second one occurred in 2009 off of the March lows that marked the bottom (for now) of the housing crisis.

Heading into today, we are down over 3% prior to the open, and it shouldn’t be surprising considering how overbought we are according to the chart below. This is why I continue to preach to traders, to grasp the opportunitities of today and not continue to project unknowingly in the future for further gains, when they are slapping you in the face today. 

734c7cd5e99abdf3c99d9bb7.png (1916×1054)

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