Not in the classic sense...if anything, it continues to show that the price index is in a corrective sequence of a strong uptrend.
But "T Theory was never about shorting the end of a T, but finding a new investment period that will show greater strength, after a period of cash buildup. Price can and very often does move higher after a T ends."
Or as Terry himself explains his theory:
A simpler way to put it is to say the market can only “make a strong run ” as long as it has previously ”rested”. As you might expect, the practical purpose of the theory is to anticipate the runs of “superior returns”.
As I remember, Terry especially used this in switching between 2 bond funds, FAGIX vs VUSTX, as Doug comments above.
Today, with ETFs, one could also use HYG vs LQD
He would buy high yielding bonds in bullish market phases and then switch to "safer" Treasuries as conditions changed.
This simple Bond technique at times offered him better returns than the stock market!
(Of course that was before all of the government QE helicopter money.)
Note how the price advance slowed at the end of a short range T (based on the Volume Oscillator) in Terry's chart below.
Edited by Rogerdodger, 23 May 2021 - 11:05 AM.