The market failed to trigger a strong Spike Bounce signal on Friday, as the monthly NL remained below its –500 level. FGIC spent the third consecutive week in extreme fear readings, 20 calendar days.
The bars on the chart are colored red when FGIC is -8 or lower (Extreme Fear) and green when FGIC is +8 or higher (Extreme Greed). [ Please follow these links: original and update explanations how FGIC works. ]
The average length of stay in the extreme Fear zone has been 46 calendar days. It was 43 days in July and August.
In the past, the occurrence of a strong Spike Bounce signal combined with a rising FGIC has frequently signaled the end of the correction.
We need FGIC to rise out of Fear zone in the next few days in order for this last Spike Bounce to be the first movement of the new bullish leg.
(This article has been posted on SpikeTrade. Follow FGIC updates on www.spiketrade.com)