Market Timing Report: Negative Divergences Set The Stage For A Nasty Spill
- In the stock market, there has historically been a pronounced correlation between what occurs in January and what happens for the remainder of that year.
- The January 2014 correction and subsequent rally have left some significant negative divergences and subsurface weakness, which the indexes are masking.
- The "January Barometer" is firmly in place, insider selling is at alarmingly high levels and margin debt is being used in a reckless fashion.
- Thus, we feel the stage has been set for a nasty spill in the stock market.