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No. of Recommendations: 19
Zeelotes has posted about the NYSE Percent Bullish being used as a possible buying opportunity. I believe the rules coalesced to:
Wait for $BPNYA to close below 31. Then, wait for the indicator to increase by a mathematical 6% from the lowest close. In combination, wait for the actual percent to increase by 6%. (It seemed like it wasn't finalized which signal was the "buy" signal. Maybe put the toe in when math increased 6%, and then fully commit when actual reading increased 6%?)
It closed April 8th at 17.88. Yesterday's big up day raised it to 19.8, which was above the math 6% (17.88 x 1.06 = 18.95). The indicator would need to rise to 23.88 for other "confirming" reading. It was actually up a hair today to 20.44
https://stockcharts.com/h-sc/ui?s=%24BPNYA&p=D&yr=...Tails
No. of Recommendations: 3
Hi Tails ..... I think you are spot on the first part -but I dont recall the confirmatory logic being discussed.
The idea behind the 6% move in the BP stems from the rationale that the Bullish Percentage Averages are calculated from P&F charts with a move threshold of 6% by Stockcharts.
So that 6% amounts to a 1-point bullish reversal roughly.
I have provided a historical pic of the BPNYA going back to 2007 here :
https://www.dropbox.com/scl/fi/x99fg7u5bskhqpaiy57...Legend :
(1) Dark Blue Triangle : Reversal logic
(2) Combined with Light Blue Ribbon at bottom : <31
(3) Green circle : My own definition of absolute despair O/S in NYSE
(4) Yellow Inverted Arrow: Hand drawn marker to show points of failure ( ie whipsaw) of this one. Its not very common - as if of course the signal itself. But will happen in cascading bears.
If you look at the Bottom panel - you will see that it has a habit of failing even from very high levels ( almost double sometimes ie >60). The median line is 54.
In the end its a matter of thrust - in this better to follow something like the Zweig
Best
No. of Recommendations: 9
Hi Tails ..... I think you are spot on the first part -but I dont recall the confirmatory logic being discussed.The below came from a June 2022 thread on the old Motley Fool board. Zeelotes was the author.
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Jim wrote: I believe that is in fact the correct interpretation of Zeelotes’ signal as described.Sorry for the confusion. I’ve actually presented two distinct methods. I calculate both. This image from my original spreadsheet should clarify.
https://zeelotes.org/$BPNYA_Method.PNGIt goes without saying that the six percent change in the value will fire first. The 6.00 rise in the value itself will fire later.
I see the one as the initial signal and the other as the confirming signal.
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Here's the thread link:
https://discussion.fool.com/t/short-term-bottom-si... The above post was #33 of 66.
Tails
No. of Recommendations: 4
Tails....Many thanks for that pic link!
Yes - I see that Zee actually has that column ( its the 6% FIXED one).
However, this is the food for thought - and pardon me, I'll fall back to probability a bit to try and explain the conundrum here:
The 2 conditions lets say are A and B with B being the confirm.
The issue is P(A) and P( A & B) ie both signals happening are actually equal ( From a event window perspective). ie A actually has implied B.(you can confirm this from the bottom panel in my pic -since it plots the BPNYA)
This is what I was trying to illustrate from the chart ..... ie if the Confirmer was actually an ADDITIONAL SAFETY switch then :P(A&B) < P(A) ie
Simple Speak: Cases where the signal gave a false positive B wouldn't have fired.You can see all the way upto 2007 that's not the case.
The Mid-May 2022 is a pristine example of this ( ie False-Positive)
(1) 5/12: MY O/S indicator fires - Green Circle
(2) 5/13: +6% relative reversal fires ( Blue up triangle) and signal from Spreadsheet
(3) 5/17: Fixed +6 : Confirmation (Spreadsheet)
(4) 6/2 : Short term TOP [Chart, S&P500]
(5) 6/7 : BPNYA ST Top : 50.31 ( > 2x from O/S level and this is fairly CONSISTENT!)
(6) 6/10: Bear signal[Spreadsheet]
(7) 6/13 : EXIT , with whipsaw
Also being a bit familiar with Zee's work - he has a plethora of indicators , and he wouldn't have used this BPNYA drop as his only EXIT point. Similarly he uses other confirmatory ones.
Net Surmise: The +6% relative is the best usage of this - because the confirmatory signal actually doesnt really add much or save you from a potential False-Positive. You can see the signal itself STANDALONE is pretty kick-ass! (Just count the # of Yellow markers I drew compared to the Bottom Blue triangles and you will see the false rate)
But its anticipatory in nature - so in Bears you will have to accept the risk of the potential falsies.
Hope this made sense!
Best
No. of Recommendations: 14
Wait for $BPNYA to close below 31. Then, wait for the indicator to increase by a mathematical 6% from the lowest close.
Well, that worked. I bought a smallish position of TQQQ and with the bounce have now sold it for a 15% gain (which was one strategy that Zee used to use).
DB2
No. of Recommendations: 0
I think a better way to do it, is buy a call option on TQQQ. You could make 85%.
No. of Recommendations: 8
I think a better way to do it, is buy a call option on TQQQ. You could make 85%.
The options return would depend upon the ones chosen, of course, but in general the returns would be more in the 30-40% range because of the large decrease in volatility as the market went up. The implied volatility for TQQQ just after the bottom was in the 120% range.
Still, better than 15%.
DB2
No. of Recommendations: 15
No. of Recommendations: 1
Here is the update of the signals from what I shared previously for those interested.
Zee, what do you use for an exit signal?
DB2
No. of Recommendations: 0
I am sure that is true. I just made up the 85% number.
No. of Recommendations: 10
DB2 asked: Zee, what do you use for an exit signal?
This method is one of many that I've shared over the years on the MI board. Pretty much everything I shared were what I'd consider more blunt instruments for purposes such as this. There are way better tools / indicators for this purpose. For example, for the most recent volatility an indicator I created in the 90s and had coded in my software in the early 00s produced an exit signal on 2/19/2025. You would then enter either a short position or an inverse ETF. The enxit signal that followed arrived on 4/7/2025.
Using Semis and a 3x ETF combo this would be the the result of the trades:
* Enter SOXS on 2/19/2025 at $17.31 and exit on 4/7/2025 at $42.35 - a gain of 144.66%.
* Enter SOXL on 4/7/2025 at $9.15. The present closing price on Friday was $13.29. This is a return of 45.25%
For an exit signal using $BPNYA, I'd suggest a composite of indicators would be the best. There is absolutely no holy grail - in other words, an indicator that will perfectly identify every point of transition in all market types. This is why a combination of indicators ratchets up the potential that odds will be in your favor. Anyway, that is how I do it and it has worked well for me.
No. of Recommendations: 2
Thanks, Zee.
I wasn't asking about identifying market tops such as back in February. The question had to do with identifying the strengh/longevity of the upward move. Having entered long in April, do you target a specific gain (say 15%) a certain time in the market (maybe one month) or wait for a composite of indicators to weaken?
DB2
No. of Recommendations: 7
DB2 asked: Having entered long in April, do you target a specific gain (say 15%) a certain time in the market (maybe one month) or wait for a composite of indicators to weaken?
All of these are options. In my own case, however, I normally opt for the third choice - the composite of indicators to fire a warning shot! I have multiple top finding indicators that assist with this job.
