NYSE McClellan Oscillator, Can anyone give me some insight? Options

[Dex]

I'm watching the NYSE McClellan Oscillator because of 'T' Theory.

http://www.mcoscillator.com/market_breadth_data/

Putting aside 'T' Theory.

I thought the oscillator would have been higher.

Can anyone give me some insight about it and what it is telling us?

[IYB]

Can anyone give me some insight about it and what it is telling us?

In simplest terms, at the moment it is saying nothing more or less than "short term correction in an Intermediate Term advance." This chart from late 2010/early 2011 shows a couple of examples of similar behavior to now:



Same thing here:



Hope that helps. NYMO/NYSI/NAMO/NASI offer, in this traders humble opinion, the most powerful information a trader can possibly acquire, from any source. Period. And it's readily available to all.... Regards, D

This post has been edited by IYB: Feb 16 2012, 07:58 PM

[Rogerdodger]

Terry Laundry has a Volume Oscillator which I think has a proprietary formula.
However one of the forum posters offered a very close simulation and Parker tweaked it.
The MACD of NYUD is the "clone" and it shows the quandary T-Theorists have been in.
It shows no big pullback followed by a breakout.
A breakout would indicate the mid-point of a new T.
I opine that it is reflective of a low volume, FED contrived market.
But if Aristotle's "A equals A" then "It is what It is."
(And if Aristotle was still here, he would be short the Dracma.)



This post has been edited by Rogerdodger: Feb 16 2012, 08:31 PM

[thespookyone]

Well, first of all, IYB is right (as usual).

Beyond that the most helpfull thing I can say is an old truism-"a little knowledge is a dangerous thing". Looking at the MCO stand alone may mislead you pretty well. The true value of the MCO is realized when you are able to look at it in proper context. That context should include, but not be limited to:level of the summation reading, level of the 5 and 10 percent indexes, and if they currently have a positive or negative cross, their position relaticve to their own zero line-and much more. The world of internal market mechanics is full of slight nuance, which when properly understood and applied-one can gain a great look into the future, and make trades with more confidence.

I have studied internal mechanics as a student of Fibs for many years-and have found it invaluable. IMHO, Fib is the finest internal mechanics man on this planet-bar none. You can take the plunge at Technical Watch for a month for $50, and I highly recommend it. I never recieve a nickle for my recommendation of Technical watch, and am quite pleased to pay my $50 a month, like everyone else. It has come back to me MANY fold. Good trading to you.

This post has been edited by thespookyone: Feb 16 2012, 09:29 PM

[voltaire]

What about this McClellan signal?

[arbman]

Voltaire I concur, the credit indices always lead the stock market, but the market breadth helps you fine tune the entries and exits. I look at the cycles within breadth and it appears to me one of the strongest technical timing tools as well after years of experimenting with various techniques...

[arbman]

BTW, COT correlation looks pretty bullish on your chart, it looks like we have a consolidation until the nominal 40 wk cycle low due in late May or early June. If the bears cannot pull a good sell off into the cycle low due in March, probably we have another higher high coming up into April.

[jjc]

BTW, COT correlation looks pretty bullish on your chart, it looks like we have a consolidation until the nominal 40 wk cycle low due in late May or early June. If the bears cannot pull a good sell off into the cycle low due in March, probably we have another higher high coming up into April.

I think you need to look closer there arb. That cot data has a 52 week lead. All I can do is scratch my head and ask myself why it works! It has a history of correlation (with the lead) beyond what that chart has shown.

[arbman]

BTW, COT correlation looks pretty bullish on your chart, it looks like we have a consolidation until the nominal 40 wk cycle low due in late May or early June. If the bears cannot pull a good sell off into the cycle low due in March, probably we have another higher high coming up into April.

I think you need to look closer there arb. That cot data has a 52 week lead. All I can do is scratch my head and ask myself why it works! It has a history of correlation (with the lead) beyond what that chart has shown.

Yes, I am looking and I am seeing 10% credit growth that is leading the stock market. The liquidity leads the stocks. This is exactly what I said, a consolidation into summer and then up, up and away. In fact, if we don't see a clear break into the cycle low into March (64-68 tdays), the chances are there will be an higher high into April from the cycle 64-68 day low. I posted earlier the analysis about the 64-68 trading day cycle. There are too many issues following this cycle, probably we will get some sort of a sell off. The intensity of it will be probably mild given the amount of credit made available...

[thespookyone]

What about this McClellan signal?

His assumption about when the QE money hits the market is flawed. As for the rest, twt.