Thursday, June 20, 2013

Hindenburg Clusterfuck 7.0

[Updated: June 20th, 2013]
Somehow I screwed up the Hindenburg count. I can't keep track anymore - apparently there have now been seven occurrences in the past eight weeks, which according to this chart, is some sort of record for such a short period of time. The signal gains accuracy when seen in clusters... 

This latest one I calculated manually, using the documented criteria:

1) The daily number of NYSE new 52 week highs and the daily number of new 52 week lows are both greater than or equal to 2.8 percent of the sum of NYSE issues 

Today's NYSE New Highs: 140
Today's NYSE New Lows: 127
Currently, there are 3167 NYSE stocks so the 2.8% threshold is 89

2) The NYSE index is greater in value than it was 50 trading days ago. 


3) The McClellan Oscillator is negative on the same day.

Today's NYMO: -39

4) New 52 week highs cannot be more than twice the new 52 week lows (though new 52 week lows may be more than double new highs).


For those who are wondering why I don't discuss the Fed policy meeting today and the ensuing asset sell-off, it's because I regard these events to be mere background noise. A Minsky style asset liquidation is inevitable, therefore these Fed interventions are only delaying the inevitable, and inflating the asset bubble in the meantime, making the outcome far worse than it would otherwise have been.