EARLY WARNING NEGATIVE CROSS - SO WHAT?

ที่อัปเดต:
My early warning indicator can offer warning signals well in advance of market turbulence. It can also help on the long side by giving confirmational signals when in agreement with a trend. It recently had a negative cross and is enough for me to raise an eyebrow and err on the side of caution. There are times when a signal crosses negative only to return positive..i.e. a false signal. It is useful, however, after a very strong trend (like we have seen over the last year and a half) and it turns down sharply. Take a look at the vertical lines for examples and take note of the one in January 2020. The signal crossed over bearish and the market sold off. Then the market found support and made a new high but the signal was still under the crossover (negative) and we had an incredible crash. I have no idea what will happen but it is certainly possible we could see a repeat of that.. I'm watching for the following:

a) a sharp selloff followed by a sharp bounce followed by a crash (like what unfolded Jan 2020-March 2020)
b) just a sharp drop... i.e. flash crash (but perhaps not a major top)
c) a false signal and another sideways consolidation and period of noise

Who can say? Just be careful out there, measure your risk to reward, and study. Speculate less. Study more. Also consider looking down when others are looking up... look up when others are looking down.
บันทึก
I received some feedback about this indicator and I want to clear up something. First, an indicator is just a tool for measuring something.

Your gas gauge in your car can indicate when you're low on fuel.. that's helpful. That's very similar to what this is. But what it can't do is predict where the next gas station is. The market can signal weakness through this indicator but we don't know if the fed will pump it (gas station) more or let it coast.. and even cool off.

The best advice I can give is this- use many indicators. Look for divergences in the market. Look at the VIX. Study put:call ratios, look at this indicator, look at market volume, etc..

just like you use many gauges in your car when navigating on a road trip, you must do the same in trading.. constantly work with the road ahead... You don't need to know everything.
บันทึก
Here's example of another tool. It's spx/vix..best ratio. This period looks similar. If it repeats again it means vix up, spx down. Let's see if it happens สแนปชอต
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zzz.. this market is dried up. Seems like a good shake up would do everyone some good.. keep this game interesting

สแนปชอต
บันทึก
Here's another handy tool.

The upper is s&p stocks above 200 d
the middle is s&p stocks above 50 d

compare to s&p index
สแนปชอต
บันทึก
Momentum is coiling in the VIX. This can be a rather significant clue. I am concerned that something is very near สแนปชอต
บันทึก
Spx/vix getting tippy
สแนปชอต
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