Market Trend Indicator (MTI) Composite Model

Paul Gire

These charts represent the 21 indicators that make up the Market Trend Indicator (MTI). The purpose of this indicator is to provide actionable buy and sell signals for investors using the S&P 500. The primary objective is to avoid the periodic bear market declines that can be devastating to ones wealth. Though a number of the indicators are themselves short-term, the model is optimized to reduce the number of trades, though of course, trendless and fast moving markets environments will tend to increase the number of trades.

Market commentary is provided in the first chart and a summary of recent MTI signals can be found in the second chart. The charts that follow are for each of the individual indicators that make up the Composite.

3.52 - $NYSI - McClellan Summation Idx - Weekly

Breadth Indicator: 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.

1/17/2017 -- The breadth surge of 11/9 has ended as the McClellan Momentum Oscillator ($NYMO) has dropped decisively below the McClellan Summation Index ($NYSI). Accordingly, traders are advised to sell the positions they bought on 11/10/2016. Depending upon which fund you purchased, resulting gains were 25% for URTY and 19% for UWM.

11/09/2016 -- A rare setup occurred today as the McClellan Momentum Oscillator ($NYMO) surged above the McClellan Summation Index ($NYSI). This indicates a characteristic surge in the number of advancing stocks, which indicates the start of a new rally. My research shows these setups are profitable more often than not. Traders are advised to go long leveraged index funds and hold until this condition ends. Small-caps currently lead large-caps so the recommended ETF's for the Russell 2000 are UWM (2x) and URTY (3x).

3.54 - HYG - Weekly

Leading Indicator

3.55 - HYG - Monthly

3.60 - $$UNEMPRATE - Monthly

3.7 - Market Commentary

SPY - Breadth Indicators - Daily

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