Possible SDA (Sharp Drop Alert) Sighting


I hesitated to post this (and didn't in my earlier report), but the potential for this is bugging me so I'm going to mention it.  While the odds might favor a bit more upside, and MMI is (slightly) up for the next two days,  and the MM Trend Trader's main signal is still on BUY, there is a possible SDA (sharp drop alert) for tomorrow and Friday. 

I hesitate to post this because I don't want to encourage anyone to aggressively short right now, but because we just completed a "denial" pattern which is almost always followed by some type of "wake-up call" or turbulence I'm going to mention it.  The formula for a SDA is overbought (per sentiment) + flatline.  The market is highly overbought (> 20 on the MAM - see earlier report), and there is a relative flatline on the chart tomorrow and Friday.  I put a question mark on the chart because it would have been a clearer SDA if tomorrow or Friday's MMI was down.

Dr. Cari Bourette is an analyst at ElliottWaveTrader.net, where she provides her proprietary market mood analysis in our flagship service, "Avi's Market Alerts."


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