The Hindenburg Omen

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Hindenburg Omen

A technical indicator named after the famous crash of the German airship of the late 1930s. The Hindenburg omen was developed to predict the potential for a financial market crash. It is created by monitoring the number of securities that form new 52-week highs relative to the number of securities that form new 52-week lows - the number of securities must be abnormally large. This criteria is deemed to be met when both numbers are greater than 2.2% of the total number of issues that trade on the NYSE (for that specific day).

Traders use an abnormally high number of 52-week highs/lows because it suggests that market participants are starting to become unsure of the market's future direction and therefore could be due for a major correction. Proponents of this indicator argue that it has been very accurate in predicting sharp sell-offs in the past and that there are few indicators that can predict a market crash as accurately.

 

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http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BDA451070-3B84-4BCE-ADAD-11B3D26FDE87%7D&siteid=mktw

http://www.safehaven.com/article-3880.htm

 

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Second Hindenburg Omen confirmed.

Blackstone IPO…a sign of a top in the Market?
Meanwhile, another action associated with a market top is the Blackstone Group's initial public offering of its stock (IPO). This is the largest public offering since 2002 , bringing in $4.13 billion. Is the smart money cashing out?
A second Hindenburg sighting...and a third!
Yesterday's market gave us a second Hindenburg Omen sighting…and today's activity in the market may give us yet a third zeppelin sighting. This now confirms the probability of a major decline in the next 120 days. The probability of a move greater than 5% to the downside after a confirmed Hindenburg Omen within the next 41 days after its occurrence is 77%, the probability of a panic sellout is 41% and the probability of a real big stock market crash is 25%. (Source: Wikepedia.com)
The occurrence of a confirmed Hindenburg Omen does not necessarily mean that the stock market will go down. On the other hand there has never been a significant stock market decline in history, that was not preceded by a confirmed Hindenburg Omen. :blink::worried:

http://www.marketoracle.co.uk/Article1349.html

 

[Birchtree]

The Ducati is oiled and ready to ride the next cycle purge - so let's walk the talk and bring it. My bet is 1400 Dow before the end of July - providing the Fed changes their wording some. They are data dependent and the data is looking fine.

 

[tsptalk]

My bet is 1400 Dow before the end of July - providing the Fed changes their wording some.

And I thought you were bullish.

 

[budnipper1]

I hope that's a typo...:worried:

Quote:
Originally Posted by Birchtree
My bet is 1400 Dow before the end of July - providing the Fed changes their wording some.

And I thought you were bullish.

 

[Griffin]

http://www.safehaven.com/article-3880.htm

Read through the stats on this thing. A Hindenburg event can be as little as 5% to register (i.e. something like we saw in February) and the time frames from signal to event can lag as much a 4 months.

This indicator is about as useful for us as: "What goes up must come down" :laugh:

 

[Griffin]

That's the only reason we know of it :notrust:. If it was called the Apollo 13 Omen, people would ignore it .

You have to admit though that it does have a scary name. :blink:

The Hindenburg Omen

 

[tsptalk]

I just got an Andria Doria signal.

I actually like these historical pattern signals.

 

[NTXDiver]

Well....at least everyone is cheery while this little debacle 'warms up' !!
Markets look pretty good for the moment though :worried:

 

[nnuut]

Don't look now!

 

[Birchtree]

It was a typo - I meant 14,000. Let the good times of summer begin.

 

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Link courtesy of Birchtree.

http://www.safehaven.com/article-7823.htm

The Dow Industrials Drop 185 Points Friday, the day after we got a Confirmed Hindenburg Omen
by Robert McHugh

The Dow Industrials fell sharply again, down 185.58 points to close at 13,360.26 Friday. Volume was huge on the decline in all major averages, which is not good. NYSE volume was 134 percent of its 10 day average, with downside volume leading at 78 percent, with declining issues at 74 percent, with S&P 500 downside points leading at a near panic 89 percent. NYSE New 52 week Highs came in at 88, with New Lows at 73, and for all intents and purposes, we got a third Hindenburg Omen Friday.

The Dow Industrials Drop 185 Points Friday, the day after we got a Confirmed Hindenburg Omen
by Robert McHugh

The Dow Industrials fell sharply again, down 185.58 points to close at 13,360.26 Friday. Volume was huge on the decline in all major averages, which is not good. NYSE volume was 134 percent of its 10 day average, with downside volume leading at 78 percent, with declining issues at 74 percent, with S&P 500 downside points leading at a near panic 89 percent. NYSE New 52 week Highs came in at 88, with New Lows at 73, and for all intents and purposes, we got a third Hindenburg Omen Friday.

Oftentimes equities will rally after a Hindenburg Omen occurs, faking folks out, then the plunge comes on the other side of the hilltop. 1987 is a perfect example of that, as was 2006.

 

[Birchtree]

Re: Bear Cave ( Bull is Allowed! )

"It is the presence of this Hindenburg Omen that makes us take Tuesday's plunge very seriously."

http://www.safehaven.com/article-7935.htm

 

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So Where Are the Dow Industrials Headed?

Mon, Jul 9 2007, 14:32 GMT
by Robert McHugh, Ph.D.
Main Line Investors, Inc.



Short term, the Dow Industrials are approaching an Intermediate term top. However, there is evidence that suggests more upside is likely over the next few weeks, leading to that top. The below pattern in the Dow Industrials is an Ascending Expanding Wedge, with diverging upper and lower boundaries, which suggests a top here of significance. Once complete, prices can be expected to drop to about the start of the pattern, at a minimum, meaning into the 9,000s over the intermediate-term, although if the PPT responds by hyperinflating the money supply, it could be 9,000 in real dollars (gold adjusted), not nominal. A confirmed Hindenburg Omen remains on the clock until October, 2007.

http://www.fxstreet.com/futures/mar...markets-forecast-and-analysis/2007-07-09.html

 

[James48843]

Thursday was third wave up.


Keep in mind the Hindenberg.

Any day now....

(this photo of the Hindenberg crashing edited out by request of some viewers.)

 

[Bullitt]

Short term, the Dow Industrials are approaching an Intermediate term top. However, there is evidence that suggests more upside is likely over the next few weeks, leading to that top.

What is that guy's articulable reason for a top? A major problem with technical analysis is that people overdo it and draw trendlines that are insignificant. The only significant line will be whether or not 1540 is our new support. Picking tops is too much guesswork. IBD has been recommending caution for about 11 months now.

 

[James48843]

Time to bring this thread back to life?

 

[weatherweenie]

Time to bring this thread back to life?

Yep, you beat a drum long enough and you're bound to be right, sooner or later.

 

[James48843]

It was reported that there was a third Hindenberg Omen yesterday.

Can anyone provide a link to confirm?