(2018-10-24, 07:50 PM)isatrader Wrote: I use the 200 day plot the same way as the Momentum Index, in that crosses below the zero line or a break down from an established long term range towards the zero line are things to take note of, as it is a long term indicator. So yes, is also used for confirmation purposes as it is often one of the last things to break down.
The standard (12,26,9) MACD line chart is the 12-day Exponential Moving Average (EMA) less the 26-day EMA, with a 9 signal line. So the '1,200,1' MACD is the 1 day Exponential Moving Average (EMA) less the 200-day EMA. So it is a little different than the plot of the price minus the 200 day MA, as that uses a simple day MA and not the Exponential Moving Average. But the difference is fairly minor, so could probably lose it.
Thanks for the explanation. I'd not fully understood what you were doing with these plots. Part of the reason for myself programming my own charts was to have a better understanding.
So, to understand you correctly, the MACD '1,200;1' will cross its zero line at the same time that the source data for the MACD would cross its own 200 day EMA.
I'm coming to the conclusion that the shorter 50 day / 10 week SMAs provide the warnings that you should take action and the longer 150 day / 30 week and 200 day / 40 week SMAs are the confirmation, or not, of those earlier warnings.
(2018-10-24, 09:27 PM)gbarbs Wrote: I read SA some time after the 2009 bottom and since then, I don't recall the Chapter 8 indicators being so decidedly negative. Looks like nearly all boxes are checked and it's time to tighten things up and look for shorts.  The MI has not crossed 0 yet but is headed there and has a strong divergence. The Dow feels like its about to fall off a cliff, if it already hasn't.
Not seeing any panic yet, so think that might start to set in and we could get the flush for a short term bottom, and then a volatile relief rally, before the market makes any firm decisions on the general trend direction it wants to take. Personally, I've been waiting for this for ages, as the best time to buy is always when all the time scales of the market breadth indicators are recovering from the bottom zones, which they are only just reaching, and that generally only happens once every 2 or 3 years or so. So I'm going to be watching the breadth closely, but doubt I'll be doing any shorting personally, as I've never been able to well. So if start saying I'm going to then that's definitely a sign that it's a bottom!
One of the challenges I find myself, is should you buy on such a recovery when the market breadth is showing full strength or when it starts to show signs of recovery? With the former you'll likely only get the full strength noted when, say 50%, of stocks are in stage 2, which implies you'll miss the strongest. However, getting in too early when breadth is strengthening risks a false dawn.
(This post was last modified: 2018-10-25, 12:28 AM by kero.)
RE: Stan Weinstein's Stage Analysis
Quote:I read SA some time after the 2009 bottom and since then, I don't recall the Chapter 8 indicators being so decidedly negative. Looks like nearly all boxes are checked and it's time to tighten things up and look for shorts. The MI has not crossed 0 yet but is headed there and has a strong divergence. The Dow feels like its about to fall off a cliff, if it already hasn't.
NHNL was worst in 2015. Momentum, as you said, isn't in the negative zone and there hasn't been any divergence on the ADline. And all major breakdowns since 1929 have been preceded by a divergence on the AD-line (included). The divergence always lasted at least for one and a half month (1937).
Quote:I read SA some time after the 2009 bottom and since then, I don't recall the Chapter 8 indicators being so decidedly negative. Â Looks like nearly all boxes are checked and it's time to tighten things up and look for shorts. Â The MI has not crossed 0 yet but is headed there and has a strong divergence. Â The Dow feels like its about to fall off a cliff, if it already hasn't.
NHNL was worst in 2015. Momentum, as you said, isn't in the negative zone and there hasn't been any divergence on the ADline. And all major breakdowns since 1929 have been preceded by a divergence on the AD-line (included). The divergence always lasted at least for one and a half month (1937).
I think that would also apply to the DJIA. Â However, you may consider the time period too short?
I've just plotted my breadth chart back 10 years (it took a while). According to my scoring it was worse than currently in 2015/16 and also, less so briefly, in 2010, 2011 & 12.
(This post was last modified: 2018-10-25, 07:02 AM by kero.)
RE: Stan Weinstein's Stage Analysis
You're right, I forgot that one. But as you say, it's really short. In my research, the shortest one was in may 1940. It lasted 1,5 month, and the Momentum was already under the 0 line.
(2018-10-24, 09:27 PM)gbarbs Wrote: I read SA some time after the 2009 bottom and since then, I don't recall the Chapter 8 indicators being so decidedly negative. Looks like nearly all boxes are checked and it's time to tighten things up and look for shorts.  The MI has not crossed 0 yet but is headed there and has a strong divergence. The Dow feels like its about to fall off a cliff, if it already hasn't.
Not seeing any panic yet, so think that might start to set in and we could get the flush for a short term bottom, and then a volatile relief rally, before the market makes any firm decisions on the general trend direction it wants to take. Personally, I've been waiting for this for ages, as the best time to buy is always when all the time scales of the market breadth indicators are recovering from the bottom zones, which they are only just reaching, and that generally only happens once every 2 or 3 years or so. So I'm going to be watching the breadth closely, but doubt I'll be doing any shorting personally, as I've never been able to well. So if start saying I'm going to then that's definitely a sign that it's a bottom!
Haha. I will add to my signals. #9 - When ISA starts posting short opps, start looking for stage 2 breakouts.
I am sitting all in cash right now.  I may look for a small opportunity to buy a put if it pulls up some but otherwise am not shorting either. Just saving cash and sitting on the side to see what happens. Its never been more clear to me that this is turning so am very interested to see what happens over the next few months.
One of the more subjective signals is the news, and I have noticed a lot of stories saying this is a pullback in a bull market, talking about the volality being typical around mid term elections. Friends talking about the market and how theyve made money. Economy firing on all cylinders. There was one article that said 15 of 18 bear market warnings triggered in the headline, but when you read the article it was filled with commentary explaining it away.
Attached are the updated charts of the RABWDB Indicator, Individual Phases, SP500 RABWDB, SP400 RABWDB and SP600 RABWDB.
Quick description of the indicator: Sample is the same as for the Survey (2287 stocks). Stock classification is done as per Chuck Dukas's TrendAdvisor Diamond described in his book (see attached TrendAdvisor Diamond). Stocks in bullish, accumulation and recovery phases are considered healthy and cumulatively plotted as an oscillator, same as in the Survey. Those in warning, distribution and bearish phases are considered technically unhealthy.
