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NASDAQ McClellan Indicator and SP500: Oversold Zone ?
August 5 ( From Stockcharts )
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We observed that when the NASDAQ McClellan Indicator was going near +10
( on a ratio adjusted basis ), most of the time, the market was taking
a pause or entered into a correction as you may see in the chart below...
And when the NASDAQ McClellan Indicator was going near -30
( on a ratio adjusted basis ), most of the time, the market
was taking a
pause or entered into a bullish trend.
This indicator is in Oversold Conditions already: the market
is expected to start a tiny upwave correction after that indicator
reached -30 within the next few sessions as history suggest.
Only a tiny dead cat bounce has we had in May before resuming
downtrend ( See chart below )...
But the most interesting technical factor is at a time were this indicator is into the ovesold zone, we are testing the 50 DMA (Day Moving Average) on SP500 as shown by the chart below.
( See chart below - bottom panel - ellipse - blue line ).
"Chance favors the prepared mind."
NASDAQ McClellan Indicator and SP500: Oversold Zone ? $SPY, $SPX #trading #SP500 #stocks
Nasdaq McClellan Oscillator ( Ratio adjusted - Dots - Top Panel )
7 DMA ( Blue Line )
and SP500 Index ( SPX - Candles - Bottom Panel )
200 DMA ( Red Line )