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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: SpecialK who wrote (10148)	6/25/2001 8:27:54 PM
From: TechTrader42	Respond to of 52237

I'd rather not be specific at this point, SpecialK. I will post the numbers (as part of my community service, under the terms of sentence for excessive market skepticism). We'll see whether it has any value as a market indicator. That remains to be seen. Suffice it to say that it isn't calculated with an abacus or a chronoscope, and that it's based on volatility. The Nasdaq Complacency Index this evening (EOD data) is 73.595. Friday, it was 93.286. The reversal off a high is a confirmed sell signal for the Nasdaq (though the reading in the 90s was an indication that complacency was too high, before it reversed). As I've said, there have been occasions when complacency was high and the market went higher in the short term, such as at the time of a rate cut (something to keep in mind now). Generally, though, high complacency indicates a downturn in the offing. On Jan. 30, the Naz Complacency index was at 78. It went to 84 the next day, when AG lowered rates on the 31st, and topped out at 89 the next day. The OEX Complacency Index was at 82 on Jan. 30 and topped out the next day at 92. The Naz and OEX drifted down from there. The OEX Complacency Index is now 74.623. It was 81.662 Friday. The turn down began Friday for the OEX Complacency Index, and that was a confirmed sell signal. Whether the rate cut will make complacency only more complacent remains to be seen. It'll be interesting, too, to see what happens the next time the indexes climb into the 80s and 90s, when there's no rate cut.