This is no "been there, done that" market

We look at the market and Chris' latest winner. You are receiving this email because you signed up to receive emails from True Market Insiders, rebranding to Sector Edge. [Unsubscribe here]( Keep the emails you value from falling into your spam folder. [Whitelist True Market Insiders](. Forgot your login information? Click [here](. [Image] Weekly Market Update Today is October 14, 2022 Good afternoon. Say what you will about the current market – but don’t call it boring. Yesterday we saw the market plummet at the open, only to rally like the cavalry riding into a beleaguered western town. The S&P 500 declined as much as -2.4%. The Nasdaq Composite was at one point down more than -3.00%. By day’s end the S&P 500 was up 2.6%, while the Nasdaq had gained 2.2%. For its part, the Dow Jones Industrial Average closed the day up 2.8%, this after being down 1.88% from the previous day’s close. It was the kind of trading day where you heard nobody saying, “Been there, done that.” (If you want to see what a day like yesterday looks like, just look at this 3-month view of the S&P. Bill Spencer Editor-In-Chief True Market Insiders And here’s the Dow… Ben Levisohn at Barron’s put this oddball session into perspective. “It was a massive rally, and one that came out of nowhere. … There wasn’t any new data, no headline-making speeches, no event that occurred just after the open to spur such a move. It literally came out of nowhere—and left us grasping for possible reasons.” Actually, it left some folks grasping for reasons. But those of us here at True Market Insider don’t give too much thought to “possible reasons.” The reason for that is because no one ever really knows the “real” reason behind anything that happens in the market. If you scan the headlines you’ll find any number of candidate culprits. Maybe it was the CPI report? Maybe it was this or that positive earnings report? Maybe it was a spreading belief that we’ve seen “peak inflation.” Maybe it was short sellers covering… Or maybe, as Levisohn suggests, it was just one of those things. Let’s add a different perspective. Here’s a look at our favorite indicator, the [New York Stock Exchange Bullish Percent Index (NYSE BPI)](. This chart shows us what percentage of stocks trading on the NYSE are currently on point-and-figure Buy signals in their own price charts – 23.3%, as you can see by the red arrow at the top. That’s a very oversold level. Since September 1 the chart has been in a column of O’s. And on September 28 the BPI moved to a Sell signal. So the market since September 28 has been considered weak over the intermediate to longer term. Despite Thursday’s storm and stress, that picture of the market hasn’t changed. We’ll know when it does, and we’ll tell you promptly. We’re still in a bear market. The bottom could fall out. Or yesterday’s lows could foretell a parting of the clouds and a longer-term rally. We shall see… What we can see, and right now, is that there’s been some weakening in the “internal market.” If you’re new to that term of art, it’s what we call the market when viewed at the sector, or industry group level and at the level of individual stocks. The internal market gives you a truer picture of what’s happening in the stock market than you get by looking simply at the major averages. (The Dow has only 30 stocks in its universe. In what universe is that a true picture of the market?) Using the US Industry Bell Curve, from our Sector Profits Pro sector research and data platform, we can see at a glance how the sectors are arrayed. As of yesterday’s close, 17 sectors were under the control of the forces of Demand – the bulls. And 28 sectors were under the control of the forces of Supply – the bears. What’s more, most of the boxes (each box is a sector) are stacked up against the left side of the chart. The further to the left, the more oversold is a sector, meaning, the lower is the reading on that sector’s own Bullish Percent (BPI) chart. Here’s the curve from this time last week. The bears were still “ahead,” but not by as much. They controlled 23 sectors to the bulls’ 22. So to repeat, we’re still in a bear market. And we’re still in a midterm election year. You can initiate bullish positions, but consider reducing the size of those positions. And consider using tighter-than-normal stops, while using put options to hedge your downside risk. For more on the market’s latest moves, check out Chris Rowe’s Technical Tuesday article from this past Tuesday ([“A Market Bottom, not THE Market Bottom.”]( And be sure to watch at the bottom of the article. You’ll see me, Chris and Costas Bocelli inaugurating a new weekly video feature we’re calling “Tuesday Morning Quarterbacks.” Now let’s move onto… THE TRADE OF THE WEEK Every Friday we’ll spotlight a particular successful trade from one of the True Market Insider editors. Here is this week’s winner. Editor: Chris Rowe Trade: A bearish play on Sempra Com (SRE). The exit came on Thursday, March 13. What happened: Chris put on this bearish position for readers of his popular Deep Market Trader service. This is a unique service in that Chris offers bullish and bearish trades, and each recommendation comes with a straight stock play as well as an option play. Here’s the pithy way Chris summed up the trade for his readers. “The stock went lower and we made a bunch of money!” This play to the downside returned +7.3% on the stock and +24% on the Put option. If you’ve followed Chris for any length of time, you might be a little jaded with how regularly he puts out winning trades. The man really has a kind of Midas touch. What’s amazing is that he’s also able to spot rare trading talent and bring it into the True Market tent. (I remember how relentlessly he went after Costas until he landed him as an editor and guru. Last year Chris set his sights on finding the #1 cryptocurrency expert in the world. And he found him, a wunderkind named Marco Wutzer. Marco has been guiding readers through the lucrative world of crypto for years now. If you’ve yet to read or profit from Marco’s work, [click here to see what you could be missing out on](. Thanks for reading, and enjoy your weekend! Bill Spencer Editor-in-Chief, True Market Insiders   You can [change your preferences here]( DISCLAIMER ©2022 by True Market Insiders, LLC, Protected by copyright laws of the United States and international treaties. 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