FINANCIAL ICEBERG

Always consider hidden risks

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TECHNICALS

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Date Criteria

1 2 3 4 An Hindenburg ?



May 31 yes yes yes yes yes



Stocks - NYSE - Do We Have an Hindenburg Omen ?

​( Stockchart , Global Economic Interection, Albertarocks, Wiki )





​​​The Indicator



​​The Hindenburg Omen is a technical analysis pattern that is said to portend a stock market crash. It is named after the Hindenburg disaster of May 6, 1937, in which the German Zeppelin Hindenburg crashed and burned.



​​The Hindenburg Omen is a combination of technical factors that attempt to measure the health of the NYSE, and by extension, the stock market as a whole. The goal of the indicator is to signal increased probability of a stock market crash.



The rationale is that under "normal conditions" a substantial number of stocks may set either new annual highs or new annual lows, but not both at the same time. As a healthy market possesses a degree of uniformity, whether up or down, the simultaneous presence of many new highs and lows may signal trouble.

The traditional definition requires each condition to occur on the same day. Once the signal has occurred, it is valid for 30 days, and any additional signals given during the 30-day period should be ignored. During the 30 days, the signal is activated whenever the McClellan Oscillator is negative, but deactivated whenever it is positive.



We will have to follow that indicator which has been triggered on april 15... And again on may 31st.



I will follow it for my curiosity even it a new signal is not adding to the first one...​​

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​Some Statistics



​​These are hard facts based what happened previously over two and a half decades of pure Hindenburg Omen history ( from Albertarocks):



◾Major Crash - 27% probability

◾Selling panic of at least 10-15% - 39% probability

◾Sharp decline of at least 8-10% - 54% probability

◾Meaningful decline of at least 5-8% - 77% probability

◾Mild decline of at least 2-5% - 92% probability

◾The HO signal is an outright miss - 7.7% probability (one out of 13 times)



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​​​ Criterias



These criteria are calculated daily :

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1. The daily number of NYSE new 52 week highs and the daily number of new 52 week lows are both greater than or equal to 2.8 percent (this is typically about 84 stocks) of the sum of NYSE issues that advance or decline that day (typically, around 3000).

NYSE New 52 Week Highs

NYSE New 52 Week Lows

2. The NYSE index is greater in value than it was 50 trading days ago. Originally, this was expressed as a rising 10 week moving average, but the new rule is more relevant to the daily data used to look at new highs and lows.

NYSE Composite Index

3. The McClellan Oscillator is negative on the same day.

NYSE McClellan Oscillator

4. New 52 week highs cannot be more than twice the new 52 week lows (though new 52 week lows may be more than double new highs).Or on a basis ratio, must be lower than 2.