As we’ve been saying for a while now, the market is stuck in a pennant formation and will eventually have to break out one way or the other, and generally, when that type of breakout occurs, it is quite sharp.
Rare Signal Says Stock Rally Is The Real Deal
February 28, 2017 by Leave a Comment
Only Three Other Occurrences Since 2002
The True Strength Index (TSI) is a momentum oscillator based on a double smoothing of price changes. As shown in the monthly S&P 500 graph below, a positive momentum crossover (black moves above red) has only occurred four times since 2002. In the three previous cases, the S&P 500 rallied for a long period of time after the crossover; the average gain was 52%.
