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CNN Fear and Greed Index Sell Signal


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#1 Douglas

Douglas

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Posted 30 April 2016 - 05:01 AM

In my system I use a host of odd ball indicators sometimes in less than common ways just to avoid herd following.  An example is the CNN Fear and Greed Index shown at money.cnn.com/data/fear-and-greed.  I conclude the index is giving a sell signal when it breaks a trend line drawn roughly under recent lows when greater than about 60.  In this way I try to identify a high level of greed which is just turning down towards fear.  This technique will not catch the top, but should catch important turns (my system is trend following after all). 

 

Yesterday the lower trend line in a nice high triangle in the index was broken giving a sell signal.  I find that the signal is best applied for relatively short intermediate time frames and doesn't necessarily provide useful info about the next day or two. 

 

Regards,

Douglas