2014年9月1日星期一

Stockbee Primary Indicator for Market Timing 2007-2014

Stockbee Market Monitor is a Breath Based indicator, it has both long term and short team breath number while eliminate the noise by count the significant move only. Below is the SP-500 weekly chart combine with Primary indicator:
    - Green on indicator: Number of stocks + 25% in one Quarter > Number of stocks - 25% in one Quarter (Primary confirm bullish)
    - Red on indicator: Number of stocks + 25% in one Quarter < Number of stocks - 25% in one Quarter (Primary confirm bearish)
    - Yellow Arrow on Chart: Extreme bullish (When Number of stock +25% <200)
    - Red Arrow on Chart: Extreme bearish (When Number of stock -25%<200)
    - Green Circle on Chart: (Breath Flip happens: strong market turn signal at bottom, Green Number is the Primary reading right before flip, some flip may happen inter-day with this number even lower)

Analysis
(1) Basically Green indicator catches the bull move while Red indicator catches the bear move. Primary indicator itself is a lag indicator, you will miss the big fortune in early market turn and give back profit during market top.
(2) In bull market, primary like to be continuous green; in bear market, it is NOT continuous red but makes marginal green (you do not see extreme bullish in these short green period)
(3) In bear market or big correction (2008, 2010 summer, 2011 fall), primary indicator can go to extreme bearish. At or close to extreme bearish phase, breath flip provide very good and strong bottom signal.
(4) Besides 2013, Major bull market often end with extreme bullish primary readings. 
(5) Top signal is not as good as bottom signal. After primary goes to extreme bullish:
      - it can go to bear market or major correction (2008, 2010 summer, 2011 faill, you see breath flip)
      - it can go to minor correction (2012 Jul, Aug or 2012 Nov, you did not see breath flip)
      - it can just side way move or pull back (with primary still green) then continue (2013)

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