NYMO McClellan Oscillator Daily Chart

We started watching this sideways triangle on the NYMO a couple weeks ago. When price moves above the zero line the bulls are happy moving forward and when price drops below zero the bears are happy. When the NYMO reaches +60, +80, +100 and higher, the markets are topping out. When the NYMO reaches -60, -80, -100 and lower, the markets are bottoming. The red squares show where the broad indexes topped out; the green squares show where the markets bottomed. For the last month, the NYMO staggers sideways but interestingly, equities run strongly higher. The last worthwhile signal was the sell signal in late October so this hints that the SPX price may want to visit the 1740-1780 area to sort things out.

The break from the pink triangle is key and identifies the winner moving forward. Bulls need the NYMO to move back above zero and then above +20 to signal blue skies ahead for markets. The bears already have the sub zero reading in their favor and only need a drop under -20, a handful of points away, to lock in a downside move for equities. This information is for educational and entertainment purposes only.  Do not invest based on anything you read or view here.  Consult your financial advisor before making any investment decision.