Rich Trend Trader's Blog

April 19, 2011

Potential Trend Model SELL Signal Upcoming

Filed under: Trend Timing Model — Rich Trend Trader @ 1:14 am

Should the S&P600, S&P400, and S&P500 all finish lower tomorrow, a trend model SELL signal will be issued.  It should be noted that the last 4 SELL signals of this type have all been ‘failures’ in that a BUY signal was not issued prior to the signal failure.


April 11, 2011

Trend Model BUY Signal Still in Effect

Filed under: Trend Timing Model — Rich Trend Trader @ 1:43 am

During the latest rally off of the trend model sell signal failure, only the S&P400 index closed above the upper Bollinger (20,2) band.  I have done a cursory look at data back to Jan/96 and found that when only one index closes above the upper Bollinger (20,2) band and there are subsequently a close below the previous 5-Day low (S&P600 and S&P400 on 4/8/11), only 4 of 14 instances has the market continued to move down to get the required low signal.  The low signal for this type of signal that I have been looking at is at least one index closing below it previous 20-Day low.  Therefore, although the market may move down from current levels, the likely hood of another significant drop without a trend model sell signal is not very high.  This aligns with several Elliott Wave blogs that are still expecting an eventual move above ~1360 on the S&P500 before a more significant correction this summer.


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