Market Health Tracking

[PuddinHead42]

11/24/25 - Strong or Wrong?

We looked good today. A very strong looking move after the Friday reversal, and as such, a follow-thru of sorts. However, we still have lots of work to do. We are just at the 50dma on SPY and Naz, so need to move above that. We also need to get above Thursday’s highs. It seems traders need to start some small positions in good setups with obvious stop loss areas. A bad example is CLS, it closed right below the 50dma on Friday and today shot up 15%.

If you buy now, you are 15% above the 50dma, which would be a classic stop loss area. You can’t buy now. If you set a 5% stop loss, you could get shaken out in the AM and miss 10% after lunch.

Look for stocks that held up well in the volatility and look for good stops to take a position (e.g. see the $GMED chart, or the morning opportunity today in IDXX after Friday’s close).

Here is our checklist of “buy switches” that will indicate growing strength in the recovery. Webby tends to punch the gas once we have 3 days of lows above the 21dma and where day 3 is an up day

[PuddinHead42]

11/25/25 - Progress

S&P, Naz and others closed above 50dma prompting recommended exposure to move to 20-40%. We did move a tiny bit above the 11/20 highs, but could not close above it.

Keep looking at the stocks that held up well during the decline. “Heat” stocks that crashed below the 50 and have not even made it back yet should be avoided. SPY and QQQ are a “safe” way to rebuild exposure.

11/26/25 - Progress

Checked off a few more today (21dma and 50dma are very close to each other, so two birds with one stone)

Technical Analyst Katie Stockon thinks we a few days of momentum left, but that this is just an interruption in the correction. If we hit new highs, the reassess.

Refresher….

Market School Counts

• 0 - In correction (0% invested)
• 1 - FTD 20%
• 2 - xx (55%)
• 3 - xx (75%)
• 4 - xx (90%)
• 5 (6,7) 100% invested

You add “1” for different good things that happen. For instance, after the 8/13 FTD, the S&P then got above the 21dma, so that took us from 1 to 2. On 8/15, there was a subsequent FTD, so that took us to 3. The S&P low got above the 50dma and that took us to 4. If we get below 21dma, 50dma, etc, the we start subtracting. This is how they decide on their exposure levels

Update: after hours, exposure was raised to 40-60% as the strength noted in the above checklist has put us into a “resumed uptrend”. Distribution days are now tracked at Naz 4 and S&P 6

[PuddinHead42]

12/7/25 (Sunday)

Technicals are looking much better as shown in checklist below. Just waiting on new power trend (and new market highs). Recommended exposure is 60-80%, but we do have 5 distribution days on Naz and S&P500.

[PuddinHead42]

12/10/25

Today recommend exposure went to 80-100%.

Naz and S&P gave ten consecutive days with lows above 21dma. 21 is above 50dma. Looks like we meet all the criteria for a Power Trend. Webby will be “punching the gas”

Start of a Power Trend

A power trend starts when these four events occur simultaneously on a major index:

The [index] low is above the 21-day exponential moving average (EMA) for at least 10 days.

1. The 21-day EMA is above the 50-day simple moving average for at least five days.

2. The 50-day line is in an uptrend.

3. The market closes up for the day.

Update: 12/11/25: Naz tested the 21dma on ORCL mess, but it rebounded nicely. S&P did not really get close to 21dma. Markets still look strong. IWM is powering up after Fed cut rates, but it has been a heartbreaker all year.

[PuddinHead42]

12/15/25 - Day two…

Of our next “3-day correction”.

S&P held the 21dma, but Naz fell below the 50dma. RSP actually had an up day, showing it was the Mag-7 hurting the market.

Ideally, we open low and reverse up and Naz gets above 50dma as do many leading AI stocks.

Recommended exposure still 80-100%

[PuddinHead42]

12/22/24

Power trend was interrupted shortly after it started, but the indexes are back above their 21dma (Friday) and look to close with the low above it today. Have also been above the 50dma.

I suspect recommended exposure will move from 60-80, to 80-60% with a good close today. Webby is worried that the Wednesday market closed at the lows without any buying support at the end. If it had finished at the 40% daily range or so, he would have been very bullish by Friday.

[PuddinHead42]

1/20/26

Ugly down day, both S&P and Naz finish solidly below their 50dma. Naz was a gap-down open below the line. Both finished at or near the lows of the day.

Recommended exposure reduced to 60-80%.

1/22: Trump walked back military takeover of Greenland and claimed he had a “framework” for a deal. Makets responded well over last two days. Naz and SPY are back above 21dma and their lows today were above the 50dma. Recommended exposure still 60-80%

1/27: 80-100% exposure. Naz and S&P have last two days’ lows above 21dma. Webby likes to push on the gas if there are 3 days like that.

[PuddinHead42]

2/5/26 - I am become death, destroyer of worlds.

Naz has been terrible and S&P only a little less so. 3 consecutive days closing below 50dma and on above average volume each time. 5 of last 6 days are down. AMZN down 11% after earnings report as they project CapEx way above expectations. This seems to guaranty a repeat of today. Let’s see, 24,000 x 10% = 2400. 24,000-2400 = 21,600 target for a standard 10% correction from the high. Even with all this increased spending from AMZN, GOOG, MSFT, and META, NVDA can hold the line, much less move up. Lots of sellers and no buyers as people seem to want to rotation out of MAG7 pretty fast.

7 distribution days on Naz, 4 on S&P. Recommended exposure 40-60%

[PuddinHead42]

2/6/26 - 3 Dog Night

…or just another 3-day correction. Indexes rebound with big moves, but still have more to prove. The Naz ended its Power Trend Thursday, but not the S&P, so mixed message there. The S&P closed above the 50 and 21dma, but the Naz is still below both. Equal weighted indexes like the RSP and EQAL are at highs, showing the market is strong for everything but the biggest tech.

Recommend Exposure back up to 60-80%.

The Friday video with Webby was extremely good this week, lots to talk about. If you are wanting to learn more about swing trading and position trading and how to read charts, check it out this week and going forward.

Dow Crosses 50,000 As Stocks End Rocky Week; CCL, GEV, TSM In Focus | Stock Market Today

The video starts with markets and then looks at sector funds and ETFS that have important messages. This week he looks at more stocks than usual and lets us know why he considers the charts broken (e.g. SLV) or ready to buy (e.g. VIK).

Stock chart reviews begin at the 26 minute mark with SLV, GLD, then RCL, CCL, VIK, NCLH comparisons. NVDA, TSM (strong), GEV (extended), IREN (broken),

Around the 1 hour mark they start looking at Webby’s market charts: Weekly candles, regression, RSI (Webby’s Really Simple Indicator) and the Bob Marley STR chart.

Regression trend for Naz is broken, but IWM is in good shape and had a nice bounce of the 50dma. RSP looks very good.

Webby says this “feels like early 1999” to him at the moment.

[PuddinHead42]

3/2/26 - Upside Reversal

The market has been choppy and under duress lately. Recommended exposure it 40-50%. The Naz has 9 distribution days and the S&P has 7.

Today offered a ray of hope. The weekend war against Iran caused futures to sell of Friday night, and the market gapped down hard at the open. But the opening tick was the low of the day and by noon, markets were positive.

At the end of the day, both major markets had both upside reversals and outside days. This is the kind of day you like to see for a “capitulation bottom” in a bear market, but it is a nice day to have anytime. Volume was lower than Friday and the markets only up 0.36% to 0.4%. Both still below 50dma, the S&P just barely. A good day could take both above those trend lines. We had an “FTD in spirit” (per Webby) on 2/20, but it was undercut. This might be considered a confirmation of that or the start of a new attempted rally. Webby will tell us Friday I suppose.

Many stocks also had good upside reversals. Look for stocks that rebounded off the 21dma average and they were holding up better than the market. Look for the subset with high volume.

[PuddinHead42]

3/9/26 - Trump Speaks

Today Trump said vague things like “we are very close, mostly” and “it will be over in a few days” Iran also said something vague and intriguing “tankers going through the Strait of Hormuz should be very careful”. They did not say “do not go”. The did not say “we will blow you up”. One rumor is China is hurting and told them to lay off. At any rate, the USO touched about $130 and fell to about $98 before closing at $104. Amazing swing. The Naz opened with a gap down and touched the 200dma, and followed that with a very strong upside reversal. Quick traders would have been buying that with stop losses below the 200dma.

This was Day 1 of an “IBD” attempted rally and we are looking for an FTD on day 4 or beyond. IBD says wait for the FTD, but Webby says you can use trend lines like 50dma or 21dma to start building new positions with stop losses.

Here is a checklist for market strength

On Friday, Webby reviewed historical examples of markets that tested the 200dma. He showed some bad failures and some good tests. This example from 1996 is what we hope to get now.

This example from 1997 looked good, but never made it back above the 50dma before falling back below the 200dma months later, at which point it finally worked.

In late 1998, the Naz bounced off the 200dma, but again did not move above the 50dma. This time it fell below the 200dma again and it was very bad!

[PuddinHead42]

3/31/26 - Day 1 of attempted rally

This was an official Day 1 of an IBD “attempted rally”. It stays intact as long as we stay above the low of Monday (Day 0). Bill would say to not buy now, but to wait for a follow through day on Day 4+. Webby might be trading moves above trend lines with tight stop losses. Monday might be a perfect day for and FTD, maybe the weekend action ends the war and/or the Strait of Hormuz is opened. Maybe.

Here is a modified “Webby” checklist for this market. Each checkoff gets us more positive about the strength of the rally. The green ones are “worth” more positivity.

Find stocks that held the 21 or 50dma during this decline. They are some of the best candidates for success in the next rally. Look for high RS as well. Look for stocks that were also high volume today, that is where the money wants to go. Build your watchlist now.

[PuddinHead42]

4/9/26 Progress

Recommended Exposure 20-40%.

But this is a news driven market, and the news seems to be ready to go south.

[PuddinHead42]

Gap up FTDs since 1980. Homework is to go to each of these days and step through it day by day and see what you would have done. Some did fail.

Here is what Webby said in the video reviewing some of the dates above…

• Thursday, Justin and Webby reviewed all the FTD Gap days of 0.5% or more. Some did fail.

• Dates to look at: 12/8/2000 (had been under 200dma much longer than we are now) This one failed by first filling the gap (hint), then closed under pre-FTD day high.

• 10/15/2002: this was at what turned out to be the bottom of that long decline from 2000-2002. The day after the FTD was down 4% and Webby would have been selling in a big way, but it did not fill the FTD gap and it stayed above the 21dma, so it was not failed. As time went on, the low stayed above the 21dma, so you could be nervous, but the market “knew” something you did not and you could not just bail. The day after that gap down, there was a gap up, but it did not go over the FTD high, so you had to be positive and buy, but not press the gas yet. The day after that, there was an upside reversal and a new high, so that was a perfect buying day.

• 4/6/2020 (COVID bear market). News was terrible, but FTD had a gap up to close above 21dma. A few days later, it moved above 200dma and the declining 50dma. You could expect some back and fill because of the declining 50dma. (and it did).

• 10/21/2014 (closest precedent for now). Not under 200dma for too long.

Here we are today on the NASDQ…

Here is 10/21/2014 (FTD)

and here is a while later…

FYI, these are the new charts from MarketSurge. You can’t tell from these shots, but they are 50x better. Allow candlesticks and a bunch of other types of bar types. Tons of drawing capabilities and overlays like “fibs”. Much more “professional” now.

[PuddinHead42]

4/13/26 - market strong like bull

recommended exposure 60-80%. Markets are above all trend lines. NDX lows are above 50dma for 3 days. Upside reversal today, very strong finish. This also qualified as a “subsequent FTD”. Tons of good bases setting up. Be very bullish until the market says otherwise.

Checklist is great

[PuddinHead42]

4/14/26

Here are those charts again, first our precedent from 2014. (Day 5 with green tick mark). The 5th day after FTD was a “subsequent FTD”, thus showing a strong rally.

And now the current NDX…we are at day 4 after the FTD. They can’t look exactly the same, but it is still close with both showing good strength at this point. Today was another “Subsequent FTD” on the NDX. Because of this strength, the new recommended exposure level is move up to 80-100%

[PuddinHead42]

Following Recommended Exposure Levels…

IBD has moved to a gradated system of recommended exposure levels to guide their customers through ups and downs of the market. The idea is to get out when the market stinks and preserve your capital during big declines. Then, by using the “attempted rally”, Follow Through Day, and exposure recommendation, you get back in before it is too late. During choppy markets, you start getting in and out a lot and can get chopped up, but the system has signaled people out before all major declines. Preservation of principal, allowing future compounding, can be very powerful.

Anyway, here is a retrospective of the exposure levels leading you out and back in

I don’t show the incremental reductions, but once it sliced through the 50dma (red line), they started taking it down. March 13 was the final “market in correction” call, with a recommended exposure of 0-20%, we were just going below the 200dma, which you have to do before any major correction

3/31 was a "rally attempt", which can be any up day after a “bottom”, the rally is intact until the low goes below the low of that last pink low day before the attempt.

Then, the system looks for a "Follow Through Day’", starting at day 4. This is to reduce early buying in a “dead cat” bounce on day 2 or 3. An FTD is when we see a significant move of 1% or more and volume higher than the previous day. Which is to say, we are waiting for meaningful institutional buying to give us confidence this rally has a chance (50% of FTDs do fail).

It took until Day 6 of the rally (4/8), which also took us above 50dma, to get an FTD, which gets us to 20-40% exposure. But there were plenty of signs that we could start nibbling: Day 3 and Day 5 were very nice upside reversals, one getting us above the 21dma (green).

4/10 took us to 40-60% exposure thanks to a nice gap up and (probably) being the third day with the low above the 50dma (hard to see).

4/13 was a subsequent FTD taking us to 60-80% Then 4/14 was another subsequent FTD, taking us to 80-100%.

This Friday, 4/17, looks like a subsequent FTD as well, which might convince you to closer to 100% than 80% exposure.

Our power checklist is looking fantastic

We have had 7 up days since the FTD, here is a list of similar. Some form a flag and resume, some crash down through the 21dma and get worse. If your charts can go back in time, this is your homework.