Throughout most of 2022 we have been in a broad based equity bear market downtrend, punctuated by periodic sharp but limited bear market rallies. As each one of these rallies lost momentum we tracked them with our Fibonacci Reversal Windows™ using a breakdown through the bottom of the window as confirmation and triggers for the next leg down. So far every one of the breakdowns have been met with oversold buying and new retracements. The big one, the Wave 3 down crash, is still to come. Although each of the major indices has their own retracement patterns, they all follow more or less the same general format, and for any one retracement it could be the Dow, SPX, Russell, or Nasdaq leading the way, so I watch them all. Once two or more fall through the bottom of their retracement zones, assume the next leg down has started and acceleration follows. Why? Because lots of deep pockets and institutions follow their own versions and act almost in unison to move the market. It's not a conspiracy, it's social mood with a touch of greed. While in the shaded zone, I consider the next leg down "Pending". In this case, we are "pending" into the end of the month, about another two weeks. Stay at least partially short until then, and than pedal to the metal when the bottom falls out. If in doubt during the trading day, check Premium (or PRO) links for Interim Alerts.
