{"id":3692,"date":"2014-01-30T09:53:13","date_gmt":"2014-01-30T14:53:13","guid":{"rendered":"http:\/\/www.morpheustrading.com\/blog\/?p=3692"},"modified":"2022-04-06T15:05:04","modified_gmt":"2022-04-06T19:05:04","slug":"timing-model-sell-mode","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/timing-model-sell-mode\/","title":{"rendered":"Why Our Stock Market Timing Model Is About To Trigger A “Sell” Signal"},"content":{"rendered":"

\"StockOn January 27, I said it was not yet time to sell stocks<\/a>, but the technical situation has deteriorated quite rapidly since then.<\/p>\n

Yesterday (an FOMC<\/a> day), stocks saw heavy volume selling action that produced another “distribution day” (a decline on increasing volume) in both the S&P 500 and NASDAQ Composite.<\/p>\n

In a healthy market, a few days of institutional selling over a 3 to 4-week period is normal and can typically be absorbed by demand.<\/p>\n

However, when the running count of distribution days reaches five or more, it nearly always signals a substantial correction is just around the corner.<\/p>\n

The 3-Part Test<\/h1>\n

There are three main components that determine the mode of my broad market timing model<\/a>, which determines whether I focus on the long or short side of the market, and how aggressively to do so. Right now, only one of those three tests is (barely) holding up.<\/p>\n

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