4 in a row ... will it be 5?

The ‘Simple Bottom Detector’ has now fired four minor bottoms in a row. Monday 9th May was almost strong enough to qualify for a major & even Tuesday 10th May qualified as a minor despite being an ‘up’ day for the index. Sentiment appears very poor currently!

Boilerplate recap of the ‘simple bottom detector’ rules …

[%NYSE new highs] - [%NYSE new lows] < -16.67% = Minor Bottom
[%NYSE new highs] - [%NYSE new lows] < -33.33% = Major Bottom

… where -16.67% is basically 1/6 more of the NYSE traded stocks achieved new lows than highs for a Minor Bottom & -33.33% is of course a 1/3 more (of total NYSE traded stocks) new lows than highs (as obtained from the WSJ Market Data resource). In practice this means a Major Bottom is signaled when a little more than 1/3 of the NYSE are achieving new lows.


My minor bottom detector signaled on 4/26 and 4/27. No significant bounce.

After May 4th the market has continued to drop but my minor bottom detector has not signaled.

Watching VIX, too, and it hasn’t been doing much. Put/call ratio not reacting much either.

Haven’t seen what I would call blow-off selling, though maybe that’s not necessary at a ‘minor bottom’.