The DecisionPoint Chart Gallery
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Last updated
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Below is a summary of the DecisionPoint signals from the Market Trend signals.
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DP Trend Model rules: If the 50-day EMA (purple) is above the 200-day EMA (blue), the long-term trend is bullish. If the 20-day EMA (green) is above the 50-day EMA (purple), the intermediate-term trend is bullish. If the 20-day EMA (green) is moving higher, the short-term trend is bullish. When the black PMO line is moving higher, the trend is bullish. If the black PMO line is above the red signal line, the trend is strongly bullish. Important: Wait until the market has closed for the day to ensure that any new signals are correct.
DP Trend Model rules: If the 17-week EMA (green) is above the 43-week EMA (purple), the long-term trend is bullish. When the black PMO line is moving higher, the trend is bullish. If the black PMO line is above the red signal line, the trend is strongly bullish. Important: Wait until the end of the week to ensure that any new signals are correct.
DP Trend Model rules: If the 6-month EMA (green) is above the 10-month EMA (purple), the very long-term trend is bullish. When the black PMO line is moving higher, the trend is bullish. If the black PMO line is above the red signal line, the trend is strongly bullish. Important: Wait until the end of the month to ensure that any new signals are correct.
The market's overbought/oversold condition can be identified by reviewing our Short-Term Oscillators and the more stable Intermediate-Term Oscillators. Two multi-period charts are also included - one based on EMA signals and one based on PMO signals.
The Swenlin Trading Oscillator for Breadth (STO-B) and the Swenlin Trading Oscillator for Volume (STO-V) provide overbought/oversold readings that are useful for roughly 1 to 2 weeks. Watch for extreme readings that signal important overbought/oversold market conditions. Also watch for divergences between the breadth-based and volume-based oscillators.
The Price Momentum Oscillator (PMO), the Volume Trend Oscillator, the Intermediate-Term Breadth Momentum oscillator (ITBM), and the Intermediate-Term Volume Momentum oscillator (ITVM) can help identify significant overbought/oversold conditions that often precede important trend changes over several weeks/months. Watch for extreme readings in these oscillators that provide "early warnings" for market turns. Also, watch for intermediate-term buy/sell signals when these oscillators cross their 10-day EMAs.
These indicators show the market's short-term (green), intermediate-term (red), and long-term (blue) strengths. Watch for signs of weakness in all three lines before a major market downturn.
These indicators show the percentage of stocks in the index that have one of three different signals based on the PMO. "% PMO Rising" (green) gives short-term, volatile signals. "% PMO Crossover Buy" (red) gives less volatile, longer-term signals. "% PMO Above Zero" (blue) gives the longest-term signals.
Breadth Charts are generally based on statistics like Advancers vs. Decliners and New 52-Week Highs vs. New 52-Week Lows.
The Advance-Decline Line and Advancing-Declining Volume Line should confirm new market highs/lows.
The Net New 52-Week Highs Indicator should rise when the market moves higher. When New Highs fail to confirm new highs in the index, a reversal is possible.
The "Average Price Relative to 52-Week Range" indicator shows the average "position" of all the stocks that make up the index, where each stock's position is measured relative to its 52-week high and low (using a scale of 0 to 100). This indicator should also be rising when the market is moving higher.
The McClellan Oscillator reflects the short-term strength and direction of the market. Readings above zero are bullish, readings below zero are bearish. Readings above +100 or below -100 are extreme and often signal a market turn.
The McClellan Summation Index provides a longer-term view. In general, if the index is rising, it is bullish, and if it is falling, bearish. Typically, the index ranges from -1000 to +1000. In the bottom panel are the two different EMAs of the (invisible) Advance/Decline ratio that are used to calculate the McClellan Oscillator. The red 39-day EMA is called the "5% Index" and the blue 19-day EMA is called the "10% Index." If both the 5% and 10% Indexes are positive, the market is strengthening. If they are both negative, it is weakening.
DecisionPoint uses both survey-based sentiment data and the Rydex Total Asset report as proxies for investor sentiment. Significant market tops and bottoms are normally accompanied by extremes of investor sentiment which often signal reversals. For example, market participants are extremely bullish at tops, just before the market starts to head down. Basically, once everyone gets on the bandwagon, the wheels will generally fall off.
Sentiment data is updated on Thursdays. Bullish signals occurs if the green bars fall below 35 (green line in upper section) or if the red bars exceed -50 (green line in lower section). Bearish signals occurs if the green bars exceed 55 (red line in upper section) or if the red bars don't cross -20 (red line in the lower section).
Using daily data from Rydex Mutual Funds inflows and outflows, this chart measures what real investors are doing with real money based on their opinion of the market. The Rydex Total Asset Ratio (black line) is calculated by adding together Rydex Money Market Assets (green) and Rydex Bear Funds Assets (blue) and then dividing that total by Rydex Bull Funds Assets (purple). The result is then plotted on an inverse scale so that bullish readings are up and bearish readings are down.
