So the McClellan Oscillator got wicked oversold Tuesday on the close. Yesterday we rallied like crazy, obviously a short covering thingy. A follow through today was key yet it screwed the pooch and decided to go lower in grand fashion.
We have also been told that this month sucks for the market, and my Jewish friends tell me “Sell on Rosh Hashanah, and buy on Yom Kippur”. That is like Oct.3 by the way, McClellan, the archaic market timer that he is, says we will rally on Oct. 3. He must be a Scottish Jew.
I am deep in tea leaves and sun dials tonight
I love watching the McClellan Oscillator because it has been so money when it comes to picking short bottoms. As you can see below, it is close to the August low which sparked a huge rally. This doesn’t mean it will hold again, BUT it is your big level to watch. See chart below then I will stretch it out.
So they say oversold “can stay oversold” right? Lets stretch the chart to see more extreme oversold, shall we?
The daily chart (below) takes you back to the McClellan low readings of -318 in mid JUNE 2013, we closed today at -228. So, can we go lower? Yes. Maybe a big washout is in motion.
When things get goofy like this I love watching this indicator.
Gun to my head? We wont tag the Aug. 2013 lows om McClellan, rather we will tag the AUGUST 2014 low reading and rally. That means we are real close to takeoff.
This is my story and I’m ticking to it. This is ONLY one indicator of the market, I use many. When the moon is in its seventh sun and Jupiter is aligned with Mars, you do divide by three and take the hypotenuse, it is then Grasshopper that you will know the market.
In other news, my $ AGIO exploded today and made historic highs. I am a buyer of biotech on current and any further weakness.
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