Richard Russell meaning to markets "dead zone"

Richard Russell has been very vocally bearish of late. He’s not the only notable investor who has turned increasingly bearish in recent months. Currently, Russell believes we are in the “dead zone” – a sort of no man’s land for the market where we could potentially meander for a while, attempt to regain our footing and then get knocked flat on our backs:




“We’re in the area that I call the “dead zone.” I’ve been here before, and it’s not easy to write in the dead zone. The dead zone tends to appear after a period of dramatic and clearly-defined action. After such periods the market will often act like an exhausted prize fighter who has been knocked down to the canvas. He gets to his feet, but he is unsteady on his feet, and he’s playing for time — until his head clears. He’s fending off the other fighter as best he can, and he’s depending on his experience. Will he make it to the end of the round? But what kind of shape is he in for the next round?



To be more specific, the last significant low for the Dow was recorded on June 7 at 9816, Transports 4038. I want to watch these two points for indications of further strength or weakness.



The Lowry’s figures are important at this juncture. Their Selling Pressure Index at 707 is 462 points above their Buying Power Index which stands at 245. Thus Selling Pressure is in the dominant position, which suggests that the market should work sharply lower at the drop of a dime.”