Utilize These Indicators To Get An Edge

  • July 6, 2001
  • Marc Dupee

Stock index futures tumbled and closed just off their lows following a slate of botched earnings reports from the tech sector and amid allegations that once-stalwart blue chips such as Xerox and Sunbeam may have engaged in “accounting fraud.”

But whatever the fundamental underpinning or “reason” du jour for the selloff, it can pay to check TradingMarkets Market Bias Indicators page for clues as to market direction. The collection of indicators on this page of proprietary readings can give traders a tremendous edge —- especially if a “critical mass” of three or more indicators are pointing in the same direction. Today we had three down-pointing indicators, the Connors VIX Reversal II, CHADTP and a TRIN Thrust. (The VIX has recently hit a nine-month low of 20.26, a level not seen since prior to the September 2000 plunge, the low reading itself a potential signal of the downside amid excess complacency).

Consider checking TradingMarkets Market Bias Indicators page every day for potential signs of market direction. If three or more signals from the page are pointing in the same direction, there is a stronger-than-normal chance that the major market averages could move in the direction of the bias.

The Dow gave an additional indication of potential downside ahead by registering on the Pullback Off Lows List. Dow futures lapped lower to effectively trigger a sell-short signal, tested the lap, and tumbled precipitously to end 219.0 lower at 10,296.0. The S&Ps also tumbled for a decline of 28.50 to 1193.80, and Nasdaq futures
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Currencies came back from oversold conditions and rallied out of Turtle Soup Plus One Buy setups. Both the euro FX
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The Japanese yen
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As stock indexes get hammered, investors fled to the perceived relative safety of bonds, working to send the September T-bond futures
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