http://www.financialcarrier.com Wed, 07 Dec 2011 13:51:51 +0000 en hourly 1 http://wordpress.org/?v=3.0.4 http://www.financialcarrier.com/enter-the-rate-of-change-indicator/ http://www.financialcarrier.com/enter-the-rate-of-change-indicator/#comments Fri, 26 Jun 2009 20:23:16 +0000 admin http://www.financialcarrier.com/?p=21 The rate of change indicator certainly proved its worth between 1995 and 2004. For starters, in its patterns of movement, the indicator clearly reflected the A-B wave sequences that took place during this period. Rate of change measurements frequently provide advance notice of market reversals, reversing direction before rather than after or even simultaneously with the trend of stock prices. As a general rule, rate of change indicators peak approximately 50-65% into a market upswing. The area at which these indicators turn down is an area in which it is probably too late for buying, possibly a touch early for selling; this is an area during which it might be appropriate to prepare for the next downside move.
As you can see, every cyclical peak that took place between 1995-2000 was presaged by a negative divergence, with prices rising to new highs, the rate of change indicator turning down to reflect diminishing upside price momentum. This characteristic, in reverse, was also present during the market declines of 2000-2002, with cyclical market lows characterized by advance positive divergences and the rate of change indicator reversing to the upside as prices moved toward their final lows. The 50-day rate of change indicator provided a fine notice of market rallies that developed in late 2001 and 2002.
Investors received clear notice of market recoveries that took place based upon the 18-month cycle, notice provided by the cyclical lengths and by the action of the 50-day rate of change indicator.

]]> http://www.financialcarrier.com/enter-the-rate-of-change-indicator/feed/ 0 http://www.financialcarrier.com/new-highs-and-new-lows/ http://www.financialcarrier.com/new-highs-and-new-lows/#comments Sat, 06 Jun 2009 18:32:27 +0000 admin http://www.financialcarrier.com/?p=7 Another indicator reflects market breadth, a measure of the true internal strength (or weakness) of the stock market. nus is the new high/new low indicator, including various derivatives of the related data. The number of issues making new highs, measured on either a daily or a weekly basis, is the number that reach new 52-week highs in price at any time on a given day or, for weekly-based readings, at some point during the week. This would be a price level higher than any level recorded in the previous 52 weeks. The number of issues falling to new lows refers to the number of issues whose prices have declined to their lowest level in the most recent 52 weeks.
It goes without saying that it is more positive when large numbers of issues advance to new highs than when the numbers of stocks in rising trends diminish. It is more negative when large numbers of issues keep falling to new lows than when increasing numbers of stocks find support, perhaps beginning new uptrends.

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