Are you positioned correctly for the next market move?
The MOTR Risk Gauge, built on principles that have guided investors through bull and bear markets for over 35 years, provides unbiased clarity in a noisy investment landscape. Here’s where it stands for the upcoming month…
October 1st, 2026 – To start last month’s Monthly Risk Gauge, we discussed how the U.S. Risk Gauge reached ‘Risk On’ across all timeframes for the first time in five years, specifically what this means and what it doesn’t mean. Considering that the Risk Gauge is built to help us contextualize overbought and oversold readings in the market, ‘Risk On’ across all timeframes tells us that weakness should be bought because the underlying structure remains intact. Despite the selling, we should at least expect a reflexive relief rally, at which point we can decide whether to take profits and go short or lean further into the rally.
What we also emphasized is that ‘Risk On’ across all timeframes does not mean the market is about to take off and rip to new all-time highs. We say this often, but it’s important: the Risk Gauge is descriptive, not predictive. Following September, the Risk Gauge is describing a structurally intact but oversold market, where we should expect a rally given that the LT Gauge remains in ‘Risk On’. However, it’s important to note that the Medium-Term (Monthly) Gauge also downticked, while the Short-Term Gauge fell all the way to ‘Risk Off’ in the Short-Term (Weekly).
Given the market’s structure heading into this pullback, we still view this weakness as a buying opportunity. However, the damage done on the way down means we will be watching the relief rally closely to determine whether enough repair takes place before the next overbought reading. If the market reaches overbought before stocks can resume their weekly and monthly uptrends, we will be taking profits and shorting into strength.
If you’re interested in following our commentary each week as the Risk Gauges develop throughout the month, including how we’re preparing for the next overbought reading, sign up for a trial of our Weekly Risk Gauge. It will be delivered straight to your inbox every Monday morning.
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