Signals & Trading Plan for Monday 2/3/20

Terminology
We would like to welcome our new members and explain terminology that we’ve been using.

$SPX $NDX have been in the Up Trend since 12/26/18.  During this Up Trend, $SPX $NDX experienced three Major Pullbacks between 12/26/18 and 1/24/20.   

• Major Pullback1:  5/1/19 to 6/3/19
• Major Pullback2:  7/26/19 to 8/28/19
• Major Pullback3:  9/19/19 to 10/3/19

After Major Pullback3, Surge10 started on 10/3/19.  Surge10 ended for $SPX on 1/22/20, and ended for $NDX on 1/24/20.   

We are now in Major Pullback4.

Our trading system based on market internal indicators issued a bearish signal calling for a short-term top on Jan 22.  Our readers had 2 days of warning before market took a serious dive. 

Our trading system also identified in advance the bounce that started on Jan 28.   We urged traders to exit long positions based on $SPX $NDX in preparation for Major Pullback4.

On Jan 30, our trading system issued  another bearish message.   We showed you a highly bearish dashboard of market internal indicators.   The following day on Fri Jan 31, $SPX $NDX $RUT all went into selling mode.

Since our system issued the first bearish signal on Jan 22, $SPX and $NDX are  down over 3%.  Meanwhile the inverse bearish ETF SQQQ has gone up 9.25%.

$SPX $NDX are now in Major Pullback4.   We don’t have enough data yet to determine whether Major Pullback4 will truly turn into a new Down Trend, or whether we will have Surge11 that follows Major Pullbackk4.   

So how do we do short-term and intermediate term trades of this new phase?   Should we get out of stocks in our long-term portfolios?
Read on.

The full article covers:
Market Internal Indicators

• Volatility & complacency
• Market breadth
• Level of bullishness
• Overbought / oversold levels
  
• Bullish / bearish divergence
  

Short-term Support & Resistance Levels

• For $SPX $NDX $RUT SPY QQQ TQQQ

Market Projections and Trading Plan

• For long-term portfolio
• For short-term trades

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