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NYSE Summation Index: A Macro Signal : Bullish Mode ?
July 14 ( From Stockcharts )
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Developed by Sherman and Marian McClellan, the McClellan Summation Index
is a breadth indicator derived the McClellan Oscillator, which is a breadth indicator
based on Net Advances (advancing issues less declining issues).
The Summation Index is simply a running total of the McClellan Oscillator values.
Even though it is called a Summation Index, the indicator is really an oscillator
that fluctuates above/below zero. As such, signals can be derived from bullish/
bearish divergences, directional movement and centerline crossovers. A moving
average can also be applied to identify upturns and downturns.
And each time we had the 7 day moving average going up
(it did on July 13 with SP500 at 2099), market followed
as you may see in the chart below...
Last time we reached that level on the 7 DMA ( Day Moving Average ) on the Summation Index was on October 23 2014 when the SP500 was within a rebound phase. ( See 1rst chart below- Blue Line ).
Observe also the divergence between the Summation Index and the SP500: A Lower High from March 2015 til now on the Summation index but a new High on the SP500 in May 2015.
The real Bullish or Bearish Signal for me will be when we finally break the Rising Wedge Pattern that started back on December 2014 and not before that. Til then, we are in a range trade situation...
( See Second chart below ).
NYSE Summation Index: A Macro Signal : Bullish Mode ? $SPY, $NYA #Trading #investing #NYSE #SP500
NYSE Summation Index ( Top Panel - Dots )
7 DMA ( Blue Line )
SP500 ( Bottom Panel - SPX )