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A NASDAQ daily chart with key indicators. This chart tracks an intermediate time frame, and Buy/Sell signals are from the 5-10-20 Timer, chart 3 below.
A set of ratio charts designed to assess the market's tolerance for risk. Stocks do best when these charts are climbing.
The 5-10-20 Timer is one of the original momentum-based timers. It's especially useful in the intermediate time frame, in which it tends to filter out noise in favor of the primary trend. The 5-10-20 is less useful in choppy, trendless markets.
The TOF ratio helps visualize sentiment among options traders. Bullish call buying creates climbing lines above, a condition generally positive for stocks. The Blue/Red 21/50-day EMA crossovers trigger Buy and Sell signals. This ratio was first created by long-time board poster Richard McRanie [The Old Fool (TOF)], and I've been a big fan of it ever since. Thanks, TOF.
The McClellan is a benchmark breadth indicator. When used as a timer, it moves you in and out of the market faster than either the 5-10-20 or the NASI. This is useful for scalping quick rallies and avoiding short-term pullbacks. The McClellan is a sensitive indicator with a noticeable margin of error, and is prone to head fakes in either direction. This is especially true during sideways, trendless markets.
The market performs best when Industrials, Transports and Utilities all trade above their 50-day EMA. Signal strength is at its peak when these charts hit new highs, especially in combination.
The VIX, annotated with market events.
These ratio charts help visualize the flight-to-safety trade. They weaken during market rallies, and improve during market weakness. Helps confirm the strength and conviction of pullbacks and rallies.
This chart shows short-term market health to help identify entry and exit points. Strong rallies stay above the black one-week EMA, and stocks act best when the black line is above the red. Gets noisy around inflection points and trend reversals.
The Tick chart shows the short-term health of the NYSE. The black line is the three-day EMA, and the light purple line is the one-day EMA. The market performs better short-term when the black line is above zero and climbing. Crossovers of the 1-day and 3-day EMA's help identify changes in bias.
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