FUN INFORMATION

In light of yesterday's off the chart Trin reading(2.82) , I decided to see what information was available regarding these big numbers. John Carter had this in his book Mastering The Trade:

"If the Trin closes above 2.0, the market has an 80% chance of rallying the next day. If the Trin closes below .6, the market has an 80% chance of selling off the next day."

He goes on to say that "if after a 2.0 reading the market's can't rally the next trading day, then the markets are in deep trouble and are setting up for a major slide."

He notes a July 1, 2004 Trin reading of 2.8 and how the markets tried to rally the next day but failed and the DJIA went on to lose 673 points before bottoming in August of 2004. Also on January 3, 2005, the TRIN closed at 2.53 and the markets could not rally and ultimately slid 410 DJIA points into the end of January.

I guess the lesson is if the markets can't get some kind of rally going today, it could be an ugly few weeks.