OVI has been negative for the QQQQ over the last month and isn’t fairing well either for the S&P. The Dow OVI is neutral but as I’ve said before it does tend to be more bullish than the other two.
The markets are not in good shape overall, however, a very short term bounce is likely at this time. I don’t expect it to last long (and it may not even materialize) but at sometime after the holidays I’d expect the market to decide on a further fall. We’ll see the signs, that’s for sure, just as we did in April and at other times.
In practical terms it would be nice to have a consolidation phase for a few days and then the fireworks can begin after the holidays. The reality is more likely to be a bit of choppiness, so keep your discipline and wait for the plum opportunities.
As ever, trade what you see. Wait for the lovely consolidation to happen and then make your move. Trading is much like hunting – getting to know the market and observing it – that’s how we’re able to be pretty accurate with our intuition.
Over the next couple of months we have some exciting developments regarding the OVI and what we may call “OVI+”. I’ll write more about that shortly, but my research is focusing further into the transaction side of what’s going on in the markets, that 99.99% of people cannot see.
For now, just hold this thought in your mind. In the stock markets, it is not unusual for the “tail to wag the dog”. That means that what goes on in the derivatives markets in fact has a heavy influence on the stock markets. Logically it should be the other way around. But extensive research proves a rather different story.
More soon
All the best
Guy
To learn more and have access to the OVI visit my Private Traders Club area. We’ll soon be allowing new members in, so keep tuned into my broadcasts and you can soon get access to the OVI to see for yourself.