I believe for most stocks the low was last Thursday November 5. If we are going to have another serious wave of selling, that would be in 2027. The reason is too many stocks made high volume capitulation lows already. Last Thursday November 5 was the highest volume of puts ever recorded — high volume put buying is a contrary indicator that usually occurs near lows. It is not enough on its own to be bullish, but it definitely supports what I see looking at a multitude of charts. 

Attached is the chart of Applied Optoelectronics. It is a textbook example that supports this case. Take a look.

The stock is down from $280 to $45. Even more significantly it fell almost 50% in 7 days from $85 to $45 into the recent low on high volume. All the signs of capitulation here as traders just wanted out at any price. The stock then bottomed on the release of earnings.

In my view too many stocks look like this for it to be the START of a new decline. Next year after a relief rally, I could see it, but not from here. Within that structure though the leaders of the last year could well decline. So we for sure need to be long new groups and not the leaders of the last couple years. One stock I like is AAOI as stated. 

Thanks,

Joe

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