My Nifty50StockList, which had 44 stocks on sells only five trading days ago has once again shown its value as an indicator in the stock market for suggesting “What’s next?”
Yesterday the NYSI turned up (almost did it Tuesday) giving a inarguable buy signal for general market on today’s open. See the “Don’t Argue With The NYSI” posts below.
So what was next?
Today 49 out the 50 listed stocks were up from yesterday’s close and 43 up on the buy signal from today’s open. Pretty much a Nifty50StockList blast across the board from the open led by NVAX up 33% (including the Biden and UK clinical vaccine trials news in the aftermarket), BEEM and TIGR both up 21%, and SUNW (the number-one stock on the list going into the day) up 12.5%.
In the list, 49 stocks are now on buys (that’s a lot), 11 are overbought (that’s not a lot) and zero are oversold. With only 11 overbought there room to keep going, to get more on the list overbought, probably tomorrow to end a bullish week.
But all on buys and none oversold once again begins to raise the never ending question in the stock market — What’s next?
Three Charts For Today:
SUNW, up 35% on the Nifty50StockList signal, BEEM up 38%, TIGR up 37%.
It’s the same signal for all three, the open of the day after the first day with less than 40 stocks on the list on sells (the purple bars on the charts).
That buy signal was on the open three trading days ago. Three days ago.
This past Thursday and Friday there were 45 and 44 stocks in the Nifty50StockList on sells. As stated below that usually marks the bottom or the beginning of a bottom of a down swing.
Those days are marked on the chart below by the purple bars.
At the close yesterday, there were 46 stocks on buy signals with futures looking higher today.
The important point at this moment is only three stocks are overbought, meaning there is a lot of room for them, and the market itself, to move up.
Time to sit up and take notice…
Last time I posted this indicator here was in this link:
The following is lifted from that link:
Again and again, my nifty-50 stock list moves from oversold to overbought and back again to oversold like an ever spinning wheel within the market’s spinning wheel…
And each time there are 40 or more of the 50 stocks on sells, it’s time to sit up and take notice since that is the number that most often signals either the bottom or the beginning of a bottom on each down swing.
I first posted about this strategy in November of 2015 on another forum.
Nothing has changed since then.
Usually it just takes one day of 40 sells, sometimes two days, to set up the bottom of a swing. Should be noted if it goes more than two days that’s is a warning that something bigger may be in the offing (last time that happened was the start of the Covid-19 bear plunge this year).
This is just an FYI since the signal is once again close by.
This is what market timing and swing trading are all about.
The results can be quite remarkable, in leveraged ETFs like TQQQ, TNA, leveraged sector ETFs like SOXL, FNGU, and, of course, hot individual stocks.
The purple marking on this chart are each time there were 40 or more of the Nifty-50 on sells.