I’ve been a student of the market for many years. Facing the facts, my interpretation of events is based on magic–Magic T’s, to be precise. This methodology focuses on Terry Laundry’s work on matched Time Trends. Per Terry Laundry, “superior returns” could be achieved by investing in those periods of time that occur after the market has “rested”.
This “rest” period can be recognized by creating Magic T’s, where the left side of the “T” shows the market either resting or weak, followed by a right side of the “T” offering periods of “superior strength.”
Regardless of theory, where are we now? We are very oversold on many indicators. What happens when Price does not move lower when indicators are at negative extremes? We are close to a period where the selling stops.
I’m sharing my charts with no further commentary at this time.
Main T-Theory Chart:
SPX VO chart:
Advance/Decline Line:
Bullish Percentage SPX:
“Simple Chart”:
I leave you with a quotation of Terry Laundry:
“During the early years, I became acquainted with Marty Schwartz, who took a very early interest in the T concept, and applied his exceptional talents to become one of the greatest stock market traders. His exploits, philosophy and comments on my theory were presented in Market Wizards by Jack Schwager in 1989. To this day I still receive inquires on how to obtain the “secrets to wealth” that Marty discussed in this book. On this point I am sorry to to inform many of you that there are no easy secrets, only powerful tools with which you might learn to uncover major opportunities before the masses arrive. Marty and I have often talked over the years about the special advantages conferred on us by our US Marine Corps training. It takes a special state of mind to “sign up” for a short boat trip, in a flimsy landing craft, to a beach completely controlled by hordes who have anticipated your arrival and have set up every imaginable way to do you in. Buying into major market opportunities presents a similarly discouraging picture. You may have good reason to anticipate profits, but if a great opportunity does indeed exist, nearly everyone will be against you, including your friends, and the predominant opinion expressed by your peers, including people you respect, will be that you are embarking on a foolhardy enterprise. I believe that T Theory’s major contribution will be to show you why it will always be difficult to buy at major lows, but using its reasoning you may be able to overcome these obstacles. At each and every great buying point you must struggle at the “moment of truth” where you face seemingly overwhelming negative odds. In T Theory this moment of truth is called “The center post of the T”. It represents the point in time where all the bearish negatives of the past have been discounted by the market and is about to be transformed into an emerging, new bull market. Finding this key juncture is a potentially dangerous occupation, but as with all good Marines, one eventually remembers during the heat of battle, to keep ones head down, shoot straight…”
Best to your trading.
*seen such low readings for such an extended time.
