Hindenburg Omen Indicator?

[sickwake 10]

Hey guys,

 

Just wondering where to find current readings of the hindenburg omen. Studying crashes from the past to see if its an indicator worth keeping. But cant find it on stockcharts, freestockscharts or yahoo. it is a chart indicator right?

 

Thanks everyone!

[BlueHorseshoe 10]

  sickwake said:

Hey guys,

 

Just wondering where to find current readings of the hindenburg omen. Studying crashes from the past to see if its an indicator worth keeping. But cant find it on stockcharts, freestockscharts or yahoo. it is a chart indicator right?

 

Thanks everyone!

 

Maybe you should look at Hydrogen Futures?

 

 

If there was any simple way to predict these things then the world would be a different place. The very fact that they are able to unfold when they do is defined by a quality of unexpectedness.

 

You could look at Global Macro approaches, but don't use leverage, be prepared to take some heat, and admit when you are wrong. When it goes your way (the underlying event driving price, not just the trade) then scale into it.

 

Or you can try and profit from the failure of others to correctly price the probability of these things occurring - take a look at what Nassim Taleb did with options.

 

Don't get drawn in by some nonsense prognosticator of doom. There's always one out there. Might be something to do with a fib level or might be something to do with rising interest rates . . . don't get dragged into it. These people sell doom because . . . well, because it sells!

 

Kind regards,

 

BlueHorseshoe

[UrmaBlume 10]

While all of my trading is much shorter term and done by automated systems, I have built a longer term indicator that I use for background information.

 

The attached chart is of an overlay of day session day bars over the 24 hours session bars in ES.

 

The indicator takes the net of buying and selling volumes for each day from a 1 minute chart and posts those values to a global variable which then makes the cumulative total of those values available to the day chart.

 

I take very little stock in divergences between price and price based indicators but the indicator posted on the attached chart only sees buying and selling volumes with no input from price.

 

The divergence is stark and has been building for almost 2 months. It also says that the divergence has not been satisfied. Divergences of this magnitude with this indicator in the past have led to well over 100 point drops in the ES.

 

Again while this indicator has absolutely no influence on my trading, it tells me that 1) we are due a consolidation/correction from this down move but 2) new highs are unlikely in the longer term.

 

My work with probabilities tells me that the shorter your projection/trade view, the easier/more likely it is to be right which is why I don't play outside the session. That said, I started recommending puts to my longer term friends 2 weeks ago.

 

This is a link to the graph that is attached below.

 

Another point of interest about this particular chart is that you might note that on most up days there is red at the bottom of the chart and on most down days there is red at the top of the chart. This denotes two points of interest:

 

1) News and trade follow the sun around the globe. Overnight news is first detected and acted upon during the Asian session and then later during the European session which means that if the news is significant it has already been acted upon by the start of our day session and we are not like to see prices at that extreme again that day, ergo, on more than half of the days, the best price of the day happens outside of our day session.

 

2) The nite session will often have the same or bigger price moves than the day session and those moves happen on about 10% of the day session volume. The explanation for these big moves on such lite volume is that there is no opposing activity. The trade that happens during those hours is mostly done by commercial/professional traders and they are usually of a like mind so very slim offers oppose their buying and there are very lite bids to absorb their selling.

 

 

cheers

 

UrmaBlume

Edited April 14, 2014 by UrmaBlume

[tradelab03 10]

The Hindenburg omen uses the basic premises of market breadth by studying the number of advancing/declining issues, but gives the traditional interpretation a slight twist to suggest that the market is setting up for a large correction.

 

This indicator gives a warning signal when more than 2.2% of traded issues are creating new highs while a separate 2.2%, or more, are creating new lows. The disparity between new highs and lows suggests that the conviction of market participants is weakening, and that they are unsure of a security's future direction.