<<Short when the stock is below the negative sloping 50 day MA >>
Ls,
Here is a formula for the 5 day slope of the 50dMA:
((Sum(Cum(1)*Mov(C,50,S),5))-
(Sum(Cum(1),5)*
Sum(Mov(C,50,S),5)/5))/
((Sum(Power(Cum(1),2),5))-
(Power(Sum(Cum(1),5),2)/5))
It's for Metastock. For indices I use the slope as a sentiment gauge and the %Above 50dMA as a momentum gauge. Also, the %Above 50dMA gives similar trendlines to price, but in general breaks the TL a day or two earlier, giving a warning. The recent rally has taken place when the 50dMA slope is negative in almost all indices.
The %Above 50dMA is also pretty good at spotting blow-off tops. See the top for the internets in July, compared with the top in June 1997. I will post a chart if interested. |
