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Strategies & Market Trends : SPY & QQQ intraday chart observations by rimshot
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From: rimshot2/8/2022 3:10:44 PM
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ajtj99

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S&P 500 cumulative net Advance-Decline line is compressing very
near its 10-day EMA -

stockcharts.com

fyi - the NYSE McClellan Oscillator requires close future vigilance whether we see something
like the extremely rare Kennedy Gammage upward breadth thrust play out in coming days / weeks

the late Kennedy Gammage wrote The Richland Report newsletter and believed
in the utility of the McClellan Oscillator for potential alerts.

Kennedy Gammage was the first to point out the "buy spike" pattern
more than 40 years ago, which occur after extremely low readings by the McClellan Oscillator

** a potential confirmed Kennedy Gammage buy spike scenario optimally
plays out over ten additional trading days once the move back above the McO zero line has
been negated by a decline back below the McO's zero line
.... with an McO test lower as the 3rd step in the criteria set for the scenario,
when the McO moves back down to the approx. $NYMO -25 to -40 level
after in the 2nd step briefly rising back above the McO zero line

more info:

as of the Monday Feb 7th close, we have seen two recent days in which $NYMO printed
negative 20 or slightly below... the decline by $NYMO does not need to fully go to negative 40

it is best if the bears are lulled into complacency for a decent # of days and $NYMO resting
during this period below its zero line .... and the more days the better for bear complacency
before a buy spike takes place

* usually 10 days below the $NYMO zero line for an optimal scenario,
but it is the concept of continued complacency by bears which is far more important
than the precision of the criteria set since this official Kennedy Gammage
Breadth Thrust set up has only seen a few ideal setups actually play out over the decades

=====================================================================

the late technical analyst Kennedy Gammage called a "buy spike" pattern when:

After an initial move higher by the McClellan Oscillator, a decline by the oscillator followed ...
which in hindsight presented a low-risk buying entry point.

Kennedy Gammage based this observation on the behavior of the McClellan Oscillator --
which is derived from the relationship between the 19-day and 39-day exponential
moving averages of the number of net advancing issues on the NYSE or Nasdaq exchanges.

A buy spike occurs after deeply negative prints 1st occur for the McO:

1. when the McClellan Oscillator achieves a sustained advancing sequence
which signals a new uptrend has been initiated.

2. then a simple pullback occurs that takes the oscillator (NYMO or NAMO)
toward zero or below zero for a brief time

3. before the McClellan Oscillator jumps higher again.
This shows that the bears don't have the strength to derail the new overall uptrend.

** at least one technician I know believes and interprets the buy spike pattern
is most credible in its forecasting reliability under the basic circumstances described below:

If we have readings above the McClellan Oscillator's zero line
... after the Oscillator's negative extremes... for a period of 1-2 weeks
before plunging back below the zero line to around the -20 to -25 level ...

this assists with the process of creating the "buy spike" pattern

(though not a requirement for the pattern to actually develop into a buy spike).
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