Every week I receive a fresh communication waxing lyrical about the OVI / Trend Fade combination.
Let’s consider what it means in a bullish scenario. OVI is blue, and Trend Fade has produced two downward blue arrows on our charts.
What does that tell us, and does it mean anything?
While no guarantee of price action can be made, such a combination can infer that sellers are weakening (Trend Fade) and leveraged players are ramping up bullishly (positive OVI).
Now, you do still need a set of eyes on the chart – no amount of AI or quanty algos can make eyeballing totally redundant, but these two proprietary indicators deliver the makings of a plausible narrative supported by logic and statistics.
And that is a phenonemal starting point.
Which is about to get better …
Because in the coming weeks we will release a new phenomenon …
The ‘OVI spike’ combined with a simplified Trend Fade.
A nuance on our current approach, with great stats, which we will add to our arsenal.
The bottom line is … if you haven’t yet discovered the joys of the OVI Trend Fade combination, you should consider being aware of it … now and moving forward.
In the meantime …
As of Thursday, the markets could still be said to be remaining irrational … And until they tell us otherwise, there is no need to try to be too clever.
I heard a horror story of someone (not any of our members!) who shorted the QQQ around 630 and is negative $350k. That’s completely nuts.
Remember from last week: “Even if you are completely correct that an asset is over or under valued, betting against the crowd can bankrupt you before the market finally corrects itself“.
Again, this is why we are rarely contrarian. The WiseTraders ethos is to follow the money, not fight it.
In this week’s news, NVDA’s earnings were good, but the market’s reaction was mixed. As I implied last week, at $5.8 trillion, is this behemoth simply too big now?
Market Outlook:
No sign just yet of the mean reversion I’ve signposted for the last couple of weeks. But it will come. The trick is not to act until you get confirmation and you have a proper plan in place to control risk.
Our Market Timers have done a remarkable job in such tricky circumstances, all of them – correctly – pointing bullish.
Notwithstanding the fact that I don’t know how Friday will manifest, I have to lean bullish today, even with the markets as overbought as they are. But it will be with caution and control.
Tech is still roaring, gold and silver are stalling, and oil is getting vertigo.
Our market commentary continues to be outstanding. Mastering market timing enables you to swim WITH the tide at the right time.
Watch the video for more detail.
Market Timers:
Longer Term Market Timer (OVIsi):
Half green.Medium Term Swing Timer:
Bullish.The Main Indices OVIs:
Esentially blue – even the IWM has perked up.
Stock Selection:
It’s a more bullish outlook this week than last week, with many stocks turning back around.
I’ve focused this week on the OVI / Trend Fade combination.
Note: Due to our server migration I’m recording this week’s OVI Market Review on Friday – a day earlier than usual, so Friday’s action may kybosh what I say!
There will be some service disruption on Saturday, but hopefully by the time you see this, the migration will be done.
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