Good morning Option Traders,

As a recent change to this service, we’re providing more specific timing advice and recommendations – saving you the work of going through our research for timing signals and picking what options to trade.

We remain bearish on the market.  The timing of our last PUTS looks good, but the markets are in the process of bouncing and we’re waiting for the timing of our next round of PUT recommendations.

First, let’s take a look at sentiment:

option sentiment

This means the crowd is betting on upside – and when this has happened at this level in the past, we were within a week of a significant top.

On the more precise timing – here’s another chart:

nasdaq new highs

In the short term, the number of new highs are bouncing, which is bullish and action you would suspect – but given the sentiment, we would consider this a bounce in a downtrend – or at best a test and slight break of previous highs.

Accordingly, we wouldn’t join the crowd and play the upside CALLS here – and we’ll wait for early next week for an option to add some PUTS to our portfolio.  At that time, we’ll explore the relationship between the NYSE and the NASDAQ to figure out which looks weakest and select from that group.