We finally hit that Zweig oversold, it was crunching for a while, but the weakness yesterday had us officially into the oversold region and we all know what that means right? Once we climb above 40 we start our Zweig Breadth Thrust watch.
Oversold Zweig’s are not automatic buys however, last August for instance we spent 9 days in the oversold region, selling sharply down once hit. What we are looking for is a big green bar, a really big green bar. That would be our thrust bar. Then we want an NR7, an inside bar or a continuation day. That would be the pattern for a bottom in place and a rally trend about to begin. Until then follow the trenders.
Our CVI continues to look weak. It would like to have a big down day to bounce.
The 40 DPI would also like to have a flush day.
Our NH/NL index is very close to bounce status usually only sitting here for one day.
What can we say about the trenders? The trend is very bearish and rallies remain un-trustworthy until we get a face ripping upside with follow through.
Cumulative 4 week NH/NL