Again and again, my nifty-50 stock list moves from oversold to overbought and back again to oversold like an ever spinning wheel within the market’s spinning wheel…
And each time there are 40 or more of the 50 stocks on sells, it’s time to sit up and take notice since that is the number that most often signals either the bottom or the beginning of a bottom on each down swing.
This is just FYI, but it is what market timing and swing trading are all about, and the results can be quite remarkable. For instance, the last 40-plus sell day was November 13th for a buy on open of the 14th. On that buy signal, among the leveraged ETFs TQQQ is up 10.6% (tracking the Nasdaq), TNA up 6.6% tracking the Russell), and UPRO up 10.7% (tracking the S&P 500).
Leveraged sector ETFs include ERX up 12.1% in energy, BIB up 10.7% in biotech, and FAS up 8.6 tracking financials.
Notable stocks on the same signal – AAPL up 4.7%, BIDU up 6.3%, and NFLX up an amazing 15.8%.
This is all in just three trading days so far. Nuff said, I guess.
(click on the chart for a larger image)