The first 5 trading days of August witnessed another four Hindenbug Omens. We have used Bob McHugh's definition of the Omen and also his filters as described in http://www.safehaven.com/article/30019/we-got-an-official-confirmed-hindenburg-omen-on-may-31st-2013.
I don't keep track of the Omen as you'll usually find a safehaven.com contributor posting a missive when it occurs. No one mentioned the occurances last week; I thought the week's trading action unusual, and decided to have a look at the data.
Bob's ctiteria for a confirmed Hindenburg Omen is two instances of the following, happening within a 36-day period:
- Number of New Highs and New Lows on the NYSE exceeds 2.2% of the issues traded;
- New 52 Week NYSE Highs cannot be more than twice New 52 Week Lows;
- NYSE 10 Week Moving Average is rising;
- McClellan Oscillator is negative.
August 7 did not qualify as the number of new highs was eight issues shy of the required 2.2% of total issues traded.
You can keep track of the data at the following links:
NYSE New Highs/Lows: http://online.wsj.com/mdc/public/page/2_3021-newhinyse-newhighs.html
NYSE Issues Traded: http://wsj.com/mdc/public/page/2_3021-tradingdiary.html
NYSE McClellan Oscillator and NYSE 10-Week Moving Average: http://stockcharts.com/ Symbol: $NYMO, $NYSE
The market is continuing to work out a large megaphone pattern.
Is the pattern complete? I don't know. I do know that Hindenburg Omens will likely signal the completion of the pattern. Is this the time? Could be!