Time wise I believe we are getting close to a buying opportunity. Likely sometime next week. How good or bad things get between now and then is the question.
Every time the market started to rally Thursday, the sellers stepped up and took it back down. It was a very lame dead cat bounce and even though the indicators are starting to see some extreme levels to the buy side, it could mean we may have not seen the worst of it yet. The fear factor hasn't shown up either but the new AAII Sentiment Survey numbers tell us we are getting closer.
Chart provided courtesy of www.decisionpoint.com
Although we did not quite get to the minimum 35% bearish figure I was hoping for, we did hit the 1 to 1 ratio of bulls to bears as they both came in at 32%. In one week we went from a 2 to 1 bull to bear ratio which was bearish for the market (and it turned out to be just that) to that 1 to 1 ratio which is just into the bullish zone. I know this can be confusing to some of the newer readers. I'll try to explain it better another time. It's Friday and it's been a long week.
Next week is the week following an options expiration week and it can typically be below average, with those Monday's being particularly weak lately. After what has happened this week however, I don't know if we should just throw the historical data out the window and just prepare to get a little more invested if we see another big sell off. I will likely move the remaining 70% I have in the G fund into stock funds either all at once, or in two moves of 35% sometime between now and the end of next week. It depends how things play out. Things still have a chance to get uglier.
That's all for today. Currently 70% G, 30% C fund. See you tomorrow.
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