10/19/2022 DOWNTREND Day 5 of Attempted Uptrend – Waiting for Strong, Rising Day

October 20, 2022

10/19/2022   DOWNTREND    Day 5 of Attempted Uptrend – Waiting forStrong, Rising Day with Substantially Higher Volume to indicate new Uptrend.

THE MARKET’s MESSAGE:   Market stuck in Directional Indecision.

The market is in a healthy "Attempted Uptrend" (sometimes called a "rally) but has NOT yet show the healthy “Follow-through Day” to signal a new Uptrend.

A good day on either the Nasdaq orS&P500 could signal a new Uptrend (rally) If both major indexes have a F-Tday, the signal would be stronger!

Recap on Follow-through day definition:

A Follow-through day, as discovered by WilliamO’Neil, founder of Investors.com, can occur on day 4 or later of a new “attempted uptrend.”

Tuesday is day4.You can see the prior 3 days on this Nasdaq chart. Note that not everyday in this 4+ day period has to be a rising day. But every day must NOT undercut the day 1 low. Since the Nasdaq is now almost 6% above the recent low, an undercut is unlikely unless this attempted rally is failing.

>>>  Thecurrent “Attempted Uptrend” the market is in will stay in effect until one ofthe major indexes (or both) . Either the Nasdaq or S&P500 ::

·      has a Follow-through day signaling  the startof a new Uptrend, or

·      undercutsthe recent low (killing the current “attempted uptrend).

IMPORTANT NOTE: The following tables show a healthy downtrend.  Theydo NOT show a reduced likelihood of a Follow-through day signaling a newUptrend. F-T days tend to happen as a “sudden change of market personality.”


Thebest “hint” we have that the market might be ready to rally (old name for Uptrend), is found in the Accumulation/Distribution table on page 5 which shows asharp rise in “A” and “B” stocks – showing aggressive buying of the beststocks.

The Accumulation/Distribution ratingskyrocketed over the last 3 weeks from ending the 4th week ago at 19% stocks with A or B ratings (stocks being heavily bought) and skyrocketing to 34% A andB stocks.

But the market continues to be in a Downtrend as the Nasdaq and S&P500 continue to live in the “Attempted Uptrend”mode without a major commitment to a new Uptrend.

Many market datatables are backward  looking. After aprolonged Downtrend (correction), even a successful new Uptrend will show a lotof “red” ratings until the market rise works its way into the ratings.


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Wishing you, “Many Happy Returns,”

Charlotte Hudgin, the ArmchairInvestor,   (214) 995-6702

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Charlotte Hudgin
Editor, Armchair Investor
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