There are a couple of signals the countertrend move lower may be coming to at least a short-term end. There is an inter-market divergence and the S&P may be signaling a completion. Additionally, the Indices have reached a point of being extremely oversold, where some type of pause to a trend has a higher probability of occurrence. However, while these exceptions suggest a possible beginning of the end, volume is strongly supporting the move lower and Market Breadth is extremely weak.

If Friday’s low is traded through with no divergence in Breadth and volume is strong, the countertrend move is not complete. However, if Breadth begins to strengthen on any move lower or higher, then at least a short-term low is in place.

DAILY BRIEFING 200201 from Joe Mertes on Vimeo.