DP Bulletin #3: NDX PMO Whipsaws Back to a BUY

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Not surprisingly, the NDX which had triggered a Price Momentum Oscillator (PMO) SELL yesterday, whipsawed into a new PMO BUY Signal. With a rally that moved price higher by 2.08%, the PMO was jerked back up.

Unfortunately, the margin remains thin between the PMO and its signal line so the NDX could see another whipsaw on the PMO back to a SELL signal. I'll send out another bulletin tomorrow if that is the case. Of note, is what could be a very large head and shoulders pattern. If the pattern executes (and I'd need to see a decisive 3% breakdown), best case is a minimum downside target around 5500. In order to breakdown decisively, price would break below the 200-EMA. Whether this is a head and shoulders pattern or not, a breakdown below the 200-EMA would be very bearish and could see price drop considerably, although maybe not so low as 5500. 

Wanted to keep you apprised of our signal status and the possibility of some serious downside action soon.

Helpful DecisionPoint Links:

Erin's PMO Scan

DecisionPoint Shared ChartList and DecisionPoint Chart Gallery

Trend Models

Price Momentum Oscillator (PMO)

On Balance Volume

Swenlin Trading Oscillators (STO-B and STO-V)


SCTR Ranking

Technical Analysis is a windsock, not a crystal ball.

Happy Charting!
- Erin

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Erin Swenlin
About the author: is a co-founder of the website along with her father, Carl Swenlin. She launched the DecisionPoint daily blog in 2009 alongside Carl and now serves as a consulting technical analyst and blog contributor at Erin is an active Member of the CMT Association. She holds a Master's degree in Information Resource Management from the Air Force Institute of Technology as well as a Bachelor's degree in Mathematics from the University of Southern California. Learn More
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