The Sigma Whole Market Index enjoyed a huge bounce back on Friday. Nevertheless, it is interesting to notice the rally was stopped by the first horizontal resistance. It wil be very important to see if the market can continue its rebound early next week and move at higher levels.
Most indexes remain in dangerous territory: we are close to major resistances, and a global bottom is not a 'done deal'.
The Sigma Trend Index sharply bounced back, and the Swing jumped to '5', generating a 'new' buy signal. The ST model has been experiencing difficult times in recent weeks. This situation has always been the case when we were at turning points in the medium term trend. So, if this is (again) the case, this is not a good signal for the market (because it could underline we are rolling from an uptrend into a downtrend).
Don't forget the relative performance between the S&P1500 and the US 10y T-Notes: the uptrend was broken
Nevetheless, the ST model generated a fresh buy signal and we implemented it. Why? Because on the long run the track record of this model is far beter than the one from our feeling.
Short Term Trading Book: