Occasionally full/new moons can signal market tops/bottoms. On 09/07/21 the Nasdaq Composite (IXIC) made a new all-time high unconfirmed by the other two main US stock indices, S&P 500 (SPX) and Dow Jones Industrial Average (DJI). I call this a “Rule of the Majority” signal – when one of the three main stock indices makes a high/low unconfirmed by the other two indices, the truth is with the unconfirming indices.
On 09/07/21 the truth was with the SPX and DJI bearish divergences implying the trend could be turning down.
Toady 10/20/21 the DJI made a new all-time high unconfirmed by the IXIC and SPX.
The daily DJI/IXIC chart courtesy of Trading View illustrates the September and potential October signals.
The September “Rule of the Majority” signal came on a new moon. Toady’s signal came on a full moon. This implies the trend could be turning down. There are only seven -trading days remaining in the October prime bearish time zone – the potential decline could be brief, maybe terminating at the end of October.
Traders are 50% short as of the SPX 10/20/20 open. Hold short.