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: Each week I receive an email from the Option Strategist (at no charge)
which
: succinctly overviews the week's action in the stock market, as McMillan
: "sees" it. An extract of last night's email is appended. McMillan supports
: his view with his favorite indicators which are also mentioned in his
email
: . Would anyone care to code these indicators for publication at
: www.traders2traders.com <http://www.traders2traders.com> ?
What indicators? Put call ratios are available as data, depending on what
datafeed you subscribe to. Market breadth is the advance decline line. 20
day moving averages.... :-)
: As for individual indicators, they all gave buy signals from deeply
oversold
: conditions except or price. Both the normal equity- only put-call
ratio
: and the weighted equity-only put-call ratio are now on buy signals. These
: buys are confirmed by the NASDAQ-100 (QQQ) weighted put-call ratio and by
: the $OEX weighted ratio. The S&P 500 futures option put-call ratios are
: tentatively on buy signals, too, although they are not confirmed yet.
: Volatility ($VIX) peaked at 57 on September 21st and declined sharply
: thereafter, leaving a spike peak in its wake. That is a buy signal for
that
: indicator.
: Finally, market breadth improved greatly and that, too, is a bullish
: sign.
: But what's missing most noticeably is price confirmation. True, prices
have
: responded magnificently to the oversold condition even exceeding its
: 20-day moving average in the process. But what I'm talking about is the
: classic higher high, higher low, higher high situation. In other words,
the
: current rally will end (actually, probably ended today in the short term)
: and then a decline will take place. It is important that that decline
make
: a higher low. Then the final confirmation would be for prices to break
: through today's high on the upside. That pattern is a powerful one, and
: it's one we saw in April as the precursor to the good rally during April
and
: May of this year.
:
:
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