I see 2 tricks today, both point to a red day tomorrow. Just for the last 2 OE weeks these tricks didn’t work well, and for 2 days so far this OE week, they didn’t work as well.
CPCE reads at 0.45 which is way below 0.56. This is too bullish. 68% chances a red day tomorrow.
CPC reads at 0.67, 7 out of 9 times recently a red close the next day.
Some people may have noticed that both VIX and SPX were green today. From the recent data as well as the past, however, there’s no edge in predicting a green or red day the next day. Counting red lines below where solid red line representing a wrong predication, we can see that 7 out of 14 times it led to a red day next day which is 50:50. I’m going to drop this trick from now on.
In tonight’s report, I’ll talk about a few historical extreme breadth readings reached today, although they mean bullish in the intermediate-term but for the coming couple of days, it might not be a good idea to chase high as the market is quite extended now.