The weekly timeframe of the CNN Fear & Greed index is the component of the FGIC that best tracks the medium-term cyclical pattern of fear and greed.
In the past, a prompt bullish reaction of the weekly FGI after sinking into extreme fear readings (see green numbers) has often signaled the start of a new bullish leg.
After confirming the uptrend triggered by the last Spike Bounce signal (vertical S line), FGIC went sideways staying a at the –4 level for week. The S&P is now fighting with an important congestion zone: on Friday a V1 was triggered but the S&P closed slightly above the +1 ATR making the signal not particularly attractive. Next week a deeper pullback with a new V1/V2 trigger while FGIC holds at current levels would be an important continuation signal of the current uptrend.
(This article has been posted on SpikeTrade. Follow FGIC updates on www.spiketrade.com)