{"id":16725,"date":"2020-11-02T07:30:39","date_gmt":"2020-11-02T12:30:39","guid":{"rendered":"https:\/\/www.jeffclarktrader.com\/?p=16725"},"modified":"2020-11-02T07:30:39","modified_gmt":"2020-11-02T12:30:39","slug":"we-have-a-buy-signal","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/we-have-a-buy-signal\/","title":{"rendered":"We Have a Buy Signal"},"content":{"rendered":"

Stocks are headed higher this week.<\/p>\n

Yes, I know that sounds crazy. Most folks are expecting chaos in the stock market. After all, COVID-19 cases are spiking higher. Europe is locking down. And, major cities in the U.S. are preparing for riots following whatever happens on Election Day.<\/p>\n

You’d have to be crazy to expect stocks to rally in this environment.<\/p>\n

Or would you?<\/p>\n

On Friday, the Volatility Index<\/a> (VIX) generated a buy signal by closing back inside its Bollinger Bands<\/a>. These sorts of buy signals have a fairly good record of happening right before solid, short-term rallies in the stock market. And, as we pointed out a couple of weeks ago<\/a>, VIX buy signals in October tend to lead to strong multi-week stock market rallies.<\/p>\n\n\n\n
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Free Trading Resources<\/strong><\/p>\n

Have you checked out Jeff’s free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career \u2013 at zero cost to you. Just click here<\/a> to check it out.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

To repeat what I wrote back then…<\/p>\n

The S&P 500 rallied 9% in about nine weeks following a VIX buy signal last October. In 2018, an October VIX buy signal led to a 4% gain in the market in just three weeks. The same thing happened in 2017.<\/p>\n

And, in 2016, the S&P 500 rallied nearly 10% in November.<\/p>\n

So, with Friday’s Volatility Index buy signal, it looks to me like we’re set up for a strong move higher this week, and perhaps for the entire month of November. The intraday<\/a> charts of the S&P 500 support that idea as well.<\/p>\n

For example, take a look at this 60-minute chart of the S&P 500…<\/p>\n

\"\"<\/p>\n

The S&P 500 fell 200 points over the past week or so. As a result, technical momentum indicators – like the Moving Average Convergence Divergence<\/a> (MACD) and Relative Strength Index<\/a> (RSI) at the bottom of the chart – dipped into extremely oversold territory.<\/p>\n

But, as the market plunged lower on Friday, the MACD and RSI indicators held above their previous lows. This sort of “positive divergence” – especially when it appears on the intraday charts – is an early warning sign of a potential bounce in the market.<\/p>\n

A similar setup in late September led to a 300-point rally in the S&P 500 in just three weeks. It looks to me like we’re setting up for something similar this time around.<\/p>\n

Best regards and good trading,<\/p>\n

<\/p>\n

Jeff Clark<\/p>\n

P.S. <\/strong>Recently, I created a strategy to get ahead of the dominating machines that currently predict the best times to profit \u2013 causing investors to miss out on huge gains. But, this strategy<\/a> would allow everyday investors to have a fair chance of predicting the markets.<\/p>\n

Click here to find out how<\/a> I put this method to work in my premier options trading service, the Delta Report<\/em>… and exactly how you could get ahead of big market moves every step of the way.<\/p>\n

Reader Mailbag<\/strong><\/h2>\n

Are you expecting chaos in the stock market this week, or will you be looking for a rally like we\u2019ve seen in the past?<\/p>\n

Let us know your thoughts – and questions you may have – at feedback@jeffclarktrader.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Stocks are headed higher this week…<\/p>\n","protected":false},"author":25,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ep_exclude_from_search":false,"service":"","footnotes":""},"categories":[1],"tags":[],"publication":[10],"person":[7],"newsletter-type":[],"ticker":[],"class_list":["post-16725","post","type-post","status-publish","format-standard","hentry","category-market-minute","publication-market-minute","person-jeff-clark"],"acf":[],"_links":{"self":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/16725","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/users\/25"}],"replies":[{"embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/comments?post=16725"}],"version-history":[{"count":0,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/posts\/16725\/revisions"}],"wp:attachment":[{"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/media?parent=16725"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/categories?post=16725"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/tags?post=16725"},{"taxonomy":"publication","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/publication?post=16725"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/person?post=16725"},{"taxonomy":"newsletter-type","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/newsletter-type?post=16725"},{"taxonomy":"ticker","embeddable":true,"href":"https:\/\/jeffclarktrader.com\/market-minute\/wp-json\/wp\/v2\/ticker?post=16725"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}