By John Del Vecchio and Brad Lamensdorf
Could a short-term bottom be in right here? The Short-term Composite Indicator, produced by Investors Intelligence has dipped to 8.6. Previously, we had warned that the market was overbought and due for a quick pullback. That move has now happened.
If there is a cascade effect to the selling in the market, the indicator could stay pinned here for a period of time. Another bad day for stocks could take the indicator down to 5, which was a buyable bottom last time in September. Right now, we are in wait and see mode.
Market sentiment is starting to turn bearish however, it has not shifted enough for a long-term bottom.
Some reduction in hedges may be warranted here as a preliminary move. Either way, expect greater volatility for the foreseeable future.
Originally Posted on December 1, 2021 – Short-Term Bottom?
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