TRIN Arms Index Daily Chart

The TRIN is a neutral reading at 1.0. During trading, readings under 1.0 verify that the bulls are in control, readings above one signal show that the bears are in control. When extreme readings occur, such as 0.50 or lower, that represents uber bullishness and typically a strong upside market day, thus, the markets usually reverse directly after such a low reading. Conversely, readings in the 3's and higher indicate uber bearishness and off the charts selling occurring, and typically a market recovery move occurs directly thereafter. At 0.44, the markets are obviously on the bullish side and need to see a market pull back to relieve the pressure.

The cross of the 10 and 50 MA provides clues as well. Note that the October market rally was verified as the 10 MA dropped under the 50 MA indicating a preference for the TRIN to drop, which is market bullish. Then when the 10 MA crossed back up thru the 50 MA, like early November, signaled the market rally. The last cross occurred in mid-December, when the 10 fell under the 50 MA signaling that the TRIN plans on heading lower and the bulls will be running, as they have ever since. So watch when the 10 MA crosses back above the 50 MA since that will verify that extended market selling is likely underway and will continue until a high TRIN is printed, such as a couple weeks ago when the high TRIN signaled that markets will recover, which they have over the last week and one-half. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here or any links connected to this information. Consult your finanical advisor before making any investment decision.