The model score today is still stuck at -85. This means that the market is not improving internally.  Nothing has changed in the spreads. Quite simply all the spread prices are so far below the relevant moving averages that small rallies just do nothing to improve the score.  It is still correct, in my opinion, to avoid risk assets, even if the next couple of days could easily be mildly positive.

Unless the market now stabilizes at higher levels, the asset spreads utilized in the model suggest this will be a temporary reprieve, with much worse to come eventually.

Our asset allocation Counter-trend model was stopped out of SPY at -3% and is back into Risk Off in TLT.

I would still advise extreme caution and lightening up of individual names which are under-performing the market into rallies.

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