This week we have a number of bullish signals. These do not necessarily represent the end of the market decline, but they are the first concrete signs of bear market exhaustion.
Friday triggered a Spike Bounce signal, rated weak, but more importantly the Spike signal is developing.
Although we have not yet seen clear signs of capitulation, the FGIC closed the week at -10, a fear level from which the market in the past has often rallied. Markets must panic before they recover. The confluence of multiple technical signals increases the odds in the trader’s favor: a recovery of FGIC in the coming week will add fuel to the powerful bullish triggers in place or in development.