On a day with plenty of selling, you will often see a downward spike in the TRIN reading. Readings of over 2.0 are frequently followed by a price rebound the following day.
Indeed, many of these high readings actually precede price bottoms. It is most likely too early to say whether we will get more than just a snapback out of this, especially when you note that the 10-DMA has not reached the same oversold readings that accompanied previous major market bottoms.
Happy Charting,
Erin
About the author:
Erin Swenlin is a co-founder of the DecisionPoint.com website along with her father, Carl Swenlin. She launched the DecisionPoint daily blog in 2009 alongside Carl and now serves as a consulting technical analyst and blog contributor at StockCharts.com. Erin is an active Member of the CMT Association. She holds a Master's degree in Information Resource Management from the Air Force Institute of Technology as well as a Bachelor's degree in Mathematics from the University of Southern California.
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