MBO Issue 48 (Dec 2015) Special Update

By Lawrence

MarketBiasObserver Special Update

Special Update on S&P 500.


Custom market breadth readings across all 3 indices has aligned to make a directional move. Due to volatility expansion this move may move in a way totally surprising to majority of the market participants.


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  • roblovet January 1, 2016 at 9:34 pm

    The move on Thursday reached about half of the projected distance to target zone on ST Tick1K. How much did year end balancing/squaring of positions affect this and is this view still valid given that 2015 is closed?

    • Lawrence January 3, 2016 at 8:09 pm

      To finish the selloff, we need to see uptick in other downside breadth readings like 20 days new low to create the necessary condition for a swing bottom.

  • roblovet January 3, 2016 at 9:23 pm

    Essentially a flush to the 1966 level you were discussing in recent updates. Since we have moved into the new year, wouldn’t such a move have bearish implications for the rest of the quarter/year even if quickly reversed based on STOPD principles? Using STOPD, what would be levels that institutions would cut exposure more significantly? December low or 4Q low? Thanks in advance.

    • Lawrence January 4, 2016 at 1:19 pm

      Today ES reached the first STOPD support of PML (what matters on daily are its higher timeframes). With extreme AD reading and quite a number of stocks printing 20 days new low, a bottom is near.

      May take all week to hammer out the low though if China continue to affect the world markets.

      If China markets holding up relatively well tomorrow, ES can lean on Monday to keep pushing higher into NFP with PMC / open gap as the primary target.

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