Last week FGIC left the neutral zone and entered the fear zone for the first time in almost a year. It is still above its extreme fear readings, closing the week where it started (-4). 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. ] S&P500 latest attempt to rebound didn’t increase the enthusiasm of the market crowd.  FGIC went sideways, suggesting that the bulls’ attempts to lead were not supported by a change in sentiment. We need to see a rise in FGIC if…

A week ago we saw that while the S&P rose to a new high there was no confirmation from FGIC which actually fell. This week it continued lower, and even the last two bullish days could not reverse that trend, and FGIC closed at –4, in negative territory. The last time FGIC was this low in May 2020 (red diagonal arrow), during its rise from the extreme fear readings of the new pandemic. A new (weak) Spike Bounce signal was triggered on Friday (dashed vertical line marked by an “S”) and it will be important to see if the eventual rise in price will be followed by a rise in…

FGIC spent the first four months of 2021 bouncing between its neutral zone and the lower edge of the extreme greed readings, without euphoric excesses and never falling into negative territory. Similarly, the five Spike Bounce signals that occurred since the beginning of this year, were all of the “weak” type, and only interrupted slight pullbacks.  Meanwhile, the S&P500 has risen over 11% since the beginning of the year.  As long as the market continues to rise without excess, it will be very frustrating to look for reversal points. (This article has been posted on SpikeTrade. Follow FGIC updates on www.spiketrade.com)

Yet another Spike Bounce signal and FGCI at the lower levels of extreme greed readings.  Last week I had highlighted as a possible correction would have been anomalous given that most frequently a correction takes its cue with high levels of euphoria on the markets.  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 last time FGCI left its extreme greed readings was at the end of December (red arrow); since then there have been two short pullbacks interrupted…

FGIC left the extreme fear readings almost 11 months ago, it has never turned back and spent so far the longest fearlessness period in the last 6 years. All pullbacks in the last 11 months have been interrupted by medium or weak Spike Bounce signals. 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. ] Spike Bounce signals generated while FGIC was at extreme greed readings, tended to lead to rallies of short duration and to be repeated in a short time (red stars).  On…

Traders like me, who came to the financial markets between the 2001 Dot.com bubble and the 2008 Credit Crunch crisis tend to think that every correction is a prelude to a terrifying bear market. While I don’t expect anything of the sort, FGIC, like the other most indicators in SpikeTrade, has been signaling a lack of strength for some time. 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. ]  Rallies that followed the two most recent Spike Bounce signals were rated Weak and are marked…

There is no change this week, as FGIC remains at the lower edge of the extreme greed readings (+8) for the eleventh consecutive day. There is no new message from FGIC. Today I’d like to share with you my latest research project: a study of the relationship between FGIC and Spike signals. 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 Spike signal is a rare and powerful signal that occurs when the weekly NH-NL crosses above –4,000.  We had it three times…

The bars on the chart are colored red when FGIC is -8 or lower (Extreme Fear) and green when the Fear & Greed Composite Index (FGIC) is +8 or higher (Extreme Greed). [ Please follow these links: original and update explanations how FGIC works. ]  There is no change this week, as FGIC remains at the lower edge of the extreme greed readings for the seventh consecutive day. The Spike signal is a rare yet powerful signal that is triggered in the deepest and most violent corrections when the weekly NH-NL crosses upward of –4,000.  This signal has been triggered three times in the past five years: the figure shows the latest Spike signal…

The bars on the chart are colored red when FGIC is -8 or lower (Extreme Fear) and green when the Composite Fear & Greed Index is +8 or higher (Extreme Greed). As the S&P500 hit new all-time highs again this week, FGIC returned to its extreme greed zone on Thursday.  This bullish period would seem to be very long, but not unusual.  You can see in the inset (dates in the European format) that the average time from the first day at extreme greed levels (+8 or higher) to the first day at extreme fear levels (– 8 or lower) has been 144 days. The longest period on record was…

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). Continuous and dashed lines represent past “strong” and “medium” Spike Bounce signals, respectively. [ Please follow these links: original and update explanations how FGIC works. ]  FGIC lost another two points during the abbreviated last week of the year.  It remains in its positive zone but continued to weaken while the S&P closed at all-time highs. 2020 has been a particular year for this indicator.  It never happened before that a Spike Bounce signal was triggered with FGIC in positive zone.  In 2020 it happened 3 times (marked…