What a difference a day makes. While day before yesterday there was no shortage of momentum chasers and confident market participants, yesterday was a anti climax. After 3-4 days of high momentum market dipped as anticipated. The market was down from word go and it pretty much stayed that way for rest of the day with no dip buyers to aggressively chase it.
If you notice how the market dipped right after Nasdaq Composite climbed over 50 day MA. Traps, small and large are always at most watched levels by technical analysis junkies. With the dip the 65 days ratio has retreated and we still continue to be in correction mode.
Now the task is cut out for dip buyers. As I have said yesterday, how the market reacts to the dip is going to tell a lot about character of market.
Market Monitor is not for day traders or Index traders. It is primarily long term timing model. It went green in 2006 August giving buy signal and stayed green till July 2007. Along the way during many of the dips it never went in to red territory. Plus there are sub component to it which signal intermediate term turn signals. There are layers of signals and they signal different time frame moves.
It is primarily a overall filter for all the methods like Double Trouble, IBD 200 and other methods. It primarily captures the juiciest part of long term trends when strategies on individual stocks can be safely executed.