NYMO McClellan Oscillator and NYA NYSE Composite Daily Charts

The central bankers have destroyed price discovery in the stock market over the last 8-1/2 years and no one really knows the true value of any asset these days. The long-term never-ending Keynesian policies are skewing data and chart relationships and clouding the economic and market picture.

Generally, you want to be buying stocks with both hands with the NYMO under -60 and you want to be throwing stocks out the window at +60 and higher. As seen from the chart, however, many of the bottoms in stocks (green circles) are occurring at only -10 or -20. Conversely, some of the short -term peaks in stocks (red circles) are occurring with a NYMO only at zero or +20. Note that the mid-May bottom was key and that occurred with a NYMO at -40 so this would be a good level to go long from.

The NYMO almost made it to +30 a few days ago which marked the top on Friday, 6/2/17. The NYA recovers late in the week last week and the Nazzy Comp prints a new all-time record high at 11754.75 and new all-time closing high at 11744.73. The NYA has printed three tops in the last 3 weeks. The first two come with a corresponding higher NYMO but the new price high in the NYA at 11755 comes with the NYMO negatively diverging; this hints that price may be running out of gas to the upside.

The NYMO is in no-man's land right now at 9.5. Watch the game proceed and if the NYMO moves below -30 and -40 you can begin nibbling on longs and if it moves lower you can buy more aggressively. Conversely, if the NYMO moves higher to +30 you can begin shorting more stocks and above +50 and +60, should it move that high, you can short much more aggressively. 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.