Why Do So Many Have to Call Bottom on the First Day Up?

Most indexes appear to have (for one day) held at the Double Bottom area we have outlined for you. A double bottom occurs when a low is hit, rallied off of, then retested with a successful hold. The problem is there is really no telling if this is just the “end of quarter” bs that should have occurred earlier or whether this is for real. Only in time will we know. The fact is so many are out to just make the grand call every day which is just a guess. There is really no need to guess. If this is THE low, the market will show its hand as the worst stop going down, the in-betweens build bases and the real strength shows up as leadership. The fact is we are again at very oversold conditions at an important technical juncture with a huge bout of pessimism to throw in. All our sentiment indicators are flashing bright green as everyone now hates the market. This would be the logical place the bleeding would be stanched.

Just keep in mind, sentiment is a secondary indicator. Price and volume are primary. We are now getting close to earnings season in these government run markets and will hope for the best. It is much easier to play the long side than the short side. And of course, if these “double bottom” lows are broken, get out the pitch fork!