McClellan Oscillator: Showing Bearish Divergence
PikerTrader | Mar 04, 2015 12:26AM ET
The market has enjoyed a 6-9% rally over the last month. During this time the McClellan Oscillator which measures market breadth has been showing weakness and not supporting the move to new highs. Most rallies in the market are coupled with the NYMO moving upwards with the market.
The rallies start to fail after the Oscillator begins to decline. You can see the charts below when this occurs. The declines also accelerate when the Oscillator drops below the 0 line which has already occurred in the SPX McClellan Oscillator. The way the osicillators are acting it could be a strong warning sign that a move lower could be happening.
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