128 replies to this topic

[Scott-stock]

Diogenes Thanks, I may be dumb, but what do you mean if the summation index lows above lowes or summation index highs above highs For example if the summation index is -230 -400 100 200 300 Which is what? Thanks I appreciate the help.

[diogenes227]

Diogenes
Thanks, I may be dumb, but what do you mean if the summation index lows above lowes or summation index highs above highs

For example if the summation index is

-230
-400 (Low)
100
200
300(High)
200
100(Low above -400 low )
200
300
400(New High, and a high above the 300 high)

Which is what?

Thanks I appreciate the help.

See your numbers revised above, and here's a graphic example in the Oscillator (NYMO) and the Summation index (NYSI) with the current lows above lows circled in green, along with the Russell index(RUT). Hope that clears it up.

http://stockcharts.com/c-sc/sc?s=$NYMO&p=D&yr=0&mn=8&dy=0&i=p67894266749&a=163053780&r=6057.png

[mdszj]

diogenes If one signal is given, say from the NASI/NAMO pair, would you enter the trade in the Nas 100 based on only this signal or do you wait until the NYSI/NYMO pair also gives confirming signal? At least once, looking back over some of the past signals, there has been a day or so difference in when the signals from each index are given. thx

[diogenes227]

diogenes

If one signal is given, say from the NASI/NAMO pair, would you enter the trade in the Nas 100 based on only this signal or do you wait until the NYSI/NYMO pair also gives confirming signal?

At least once, looking back over some of the past signals, there has been a day or so difference in when the signals from each index are given.

thx

NASI/NAMO are the same signal -- when the NAMO crosses zero it turns the NASI up or down.

I think you mean NASI/NYSI? They are at times. as you say, a day or two apart. That just happened. The NYMO whipsawed along the zero line turning the NYSI up and down a couple of times. Watching the NASI would have kept you out of that. Then they both went long last Friday, 5/29. (And there are times when they can whipsaw together. It wouldn't surpise me if they do that right now, given that I don't think we went down far enough or long enough on this last decline to get a decent pullback in place.)

I tend to want both the Nasdaq and the NYSE Summation indexes to agree and confirm each other, but if you are only trading the Nas 100, the NASI may be more important to you. That's your decision. I'd suggest diligent study and a lot of paper trading experience if you are just starting out before you rely on any indicator in the market.

Good trading to you.

[diogenes227]

Wouldn't you know it? We have the whipsaw mentioned above. The NYSI is once again down (barely) giving a sell signal. The NASI is still up (barely), holding to its buy signal. Tough market. What to do? What to do? Sell half? Not a bad idea. Wait to see which way the whip whips next? Usually, at this point in the McClellan cycle (three to four weeks from the momentum low), the market sells off into a "buy spike" and then the rally really gets rolling. That's typical of bull markets but this is still a bear so... What to do? As Ed Hart on the Financial News Network used to say: "We will know in the fullness of time." Probably tomorrow. In the meantime, a combination of leveraged long ETFs -- SSO, QLD, UWM -- are up 6.7 percent since the May 29th Summation buys signals. Good trading to everyone.

Edited by diogenes227, 08 June 2009 - 04:15 PM.

[diogenes227]

Ah, the fullness of time. Both the NYSI and the NASI are now in agreement -- SELL. Since the March 29th buy signal on the Summations, the combination of leveraged long ETFs being tracked here -- SSO, QLD, UWM -- closed today up a bit more than seven percent. Kind of a tricky trade with the NYSI whipsawing along the way, but in the end a relatively benign sell-off to conclude the run. Regardless, the McClellan is in sell mode until further notice. SDS, QID, TWM for leveraged short ETFs. And for a sometimes scary bang for the buck, maybe some TZA. Good trading to all.

[laza]

Diogenes -- great thread. I've been lurking for quite a while. Question: I notice a "ledge" has formed on the NYSI. I once read that ledges are bases to "fall off of" and wonder if you agree with that. IOW, is there a history of ledges preceding falls? Thanks.

[diogenes227]

Diogenes -- great thread. I've been lurking for quite a while.

Question: I notice a "ledge" has formed on the NYSI. I once read that ledges are bases to "fall off of" and wonder if you agree with that. IOW, is there a history of ledges preceding falls?

Thanks.

I agree ledges are usually made to fall off of, but at the moment I don't think that is much of a ledge (a couple more days along that line and I'll change my mind). As to your second question, falls are not necessarily preceded by ledges. Falls can come at any time, with or without a ledges.

Good trading to you.

[laza]

Thanks diogenes. Much appreciated.

[diogenes227]

The Nasdaq Summation turned up Friday and managed to hold on today (barely) as the New York Summation (NYSI) joined it in positive territory. This a BUY.

Or at least it's a cover shorts. Given that most indexes are in a four-day advance, I wouldn't be surprised to see at least one down day here which might whipsaw the Summations. But for now, it's go long, buy the dips, whatever one is comfortable with, until further notice. The market sides with the bulls.

A basket of leveraged short-side ETFs -- SDS, QID, TWM -- in place for the sell on the Summations closed out today up 2.4 percent. Better than a loss. The advance in the last four days did some damage to that position, which was up nearly 11 percent the day before the Fed announcement (I guess the Fed saved the day for the bulls ).

I'm going to track SSO, QLD, and UWM on this buy signal. But I'm trading IWM, UWM, and TNA on the Russell.

Good trading to everyone.

http://stockcharts.com/c-sc/sc?s=$SPX&p=D&yr=0&mn=5&dy=0&i=p11613899261&a=163053782&r=5230.png