The Hindenburg Omen

[Bullitt]

Still no signs of a Hindenburg Omen yet.

 

[James48843]

Still no signs of a Hindenburg Omen yet.

So your're a believer now I take it. I know I am!

Yep- they are pretty rare. But when one rear's it's ugly head look out .

 

[airlift]

When was the last time that a Hindenburg Omen occurred?

 

[James48843]

When was the last time that a Hindenburg Omen occurred?

June of 08- with Dow at 12000 and falling.

http://www.tsptalk.com/mb/showpost.php?p=168389&postcount=33

it began to fall off a cliff shortly after that.

Ended up falling down to 6469 (March 09) after that, before reversing.

 

[airlift]

Thank you. We have to be on our toes.

 

[Bullitt]

I think the jury is still out. I wouldn't call this thing "precise" based off the historical occurrences in the link below.

http://www.marketoracle.co.uk/index.php?name=News&file=article&sid=13753

McHugh says it's time to start preparing for the catastrophic wave C down.

https://www.technicalindicatorindex.com/Default.asp

 

[James48843]

Well, I'll tell you all what. The last time the Hindenberg Omen came up in conversaton, I missed it because I was TDY, and not watching closely.

From here on out- if ANYONE sees anything written saying that a Hindenberg Omen is occuring, Please- BY ALL MEANS- send me a PM and let me know.

Thanks to all for the future.

 

[Bullitt]

We'll watch your six James.

Honestly, I'm thinking one is looming on the horizon.

 

[Bullitt]

For those who are a bit rattled after today's selloff, I'm not sure if this guy remembers he posted this blog entry or plans on updating it, but it's worth monitoring.

I will be keeping a lookout for the Hindenburg Omen since NO MAJOR DECLINE has started without one over the past 25 years. Needless to say, one did occur at the start of the primary run down.

http://hit-the-bid.blogspot.com/2009/06/calculating-hindenburg-omen-indicator.html

 

[Bullitt]

So we have rules number 1 and 2, waiting for more new 52 week lows to be made. This will require a sell-off of a portion, or sector of the index to start throwing it out of balance. Nothing that will happen over night.

Rule number 3, the 10 week MA is satisfied, and will stay there for awhile.

Rule number 4 needs to be checked daily, but one should not concern themselves until we start seeing more 52 week lows.

Rule number 5, can not even kick in until rules number 1 and 2 are satisfied.

...The best thing to do for now is to keep your eyes on the weaker sectors...As the lows start increasing I am sure it will fill the blogs with chat, and most will be aware of an approaching Hindenburg Omen before it gets confirmed.

http://ewtrendsandcharts.blogspot.com/2009/10/hindenburg-omen.html

 

[Birchtree]

I've been run over by several Hindenburg Omens in the past - not any fun. Thanks Bullitt for the educational information.

 

[Bullitt]

Brrrrrrrrrrrrrrrrrrrr. Anybody else hear those zeppelin engines humming in the distance?

 

[tsptalk]

Can we go over the Omen rules again? I forget.

So we have rules number 1 and 2, waiting for more new 52 week lows to be made. This will require a sell-off of a portion, or sector of the index to start throwing it out of balance. Nothing that will happen over night.

Rule number 3, the 10 week MA is satisfied, and will stay there for awhile.

Rule number 4 needs to be checked daily, but one should not concern themselves until we start seeing more 52 week lows.

Rule number 5, can not even kick in until rules number 1 and 2 are satisfied.

...The best thing to do for now is to keep your eyes on the weaker sectors...As the lows start increasing I am sure it will fill the blogs with chat, and most will be aware of an approaching Hindenburg Omen before it gets confirmed.

 

[Bullitt]

The 52 week lows should start rolling in sooner than later. The rally was so sharp off the oversold March lows that 52 week lows have been a far cry all along- until now.

 

[tsptalk]

Thanks. I should have just looked at the first post.

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.

 

[Bullitt]

Ayyy-O!

Not from the doctor himself, but apparently this persons numbers say we've had more than one. I am surprised it took this long to get the signal seeing how big the run up was off March 2009's lows, but here they come. Remember, there is no such thing as 'one perfect indicator'.

The Hindenburg Omen showed itself again for the second consecutive day which confirms the signal that the market is likely to achieve at least a ten percent correction in the next few months. The last time we had a confirmed Hindenburg Omen signal was in May 2008. We can all remember what happened from that point.

http://www.safehaven.com/article/17822/bounce-but-hindenburg-omen-reappears

 

[James48843]

Here is another report that says Hindenberg Omen:

http://www.bloomberg.com/news/2010-...er-leg-down-in-stocks-technical-analysis.html

It's too late to do anything today- BUT

I will take a good look at this over the weekend and most likely bail out Monday.


Everybody- pay attention- if this really is a Hindenberg Omen it's time to look seriously at the lifeboats, and quick.

 

[Birchtree]

Really?

 

[Bullitt]

Something to keep in mind here is that a brokerage house (Schaeffer's) will NEVER tell you to go to 100% cash. That's like Apple coming out and telling you not to buy an iPhone. It is always in the best interest of Wall Street for the individual investor to stay invested while the bank proprietary accounts run to cash. The only way for this indicator to trip is for institutional money to be selling and going to cash/bonds.

Hindenburg Omen Flashes

Its creator, a blind mathematician named Jim Miekka, said his indicator is now predicting a market meltdown in September.

The Omen was behind every market crash since 1987, but also has occurred many other times without an ensuing significant downturn. Market analysts said only about 25% of Omen appearances have led to stock-market declines that can be considered crashes.

"The Hindenburg Omen does show some deteriorating internals, which signals some major concerns," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research. "But it isn't a reason to move to 100% in cash. We're taking a wait-and-see approach, but considering its recent history, we're considering it more than other indicators."

http://online.wsj.com/article/SB10001424052748703321004575427791421316112.html?KEYWORDS=hindenburg

Something to keep in mind here is that a brokerage house will NEVER tell you to go to 100% cash. That's like Apple coming out and telling you not to buy an iPhone.

 

[Warrenlm]

But remember, even if this really is this thing, the potential additional downside may not be as great as the name implies. ........Right? I think I heard that from someone paid a lot of money to yak on CNBC.