Coppock Curve Update Mid-Year 2011

Many of the shorter term signals are looking as though they are rolling over indicating a market reversal. I am not convinced yet. Either is the CMI, although the CMI has given a few hints that it wants to cut out of the QLD trade and only needs a little push as a convincer. I get the feeling that the CMI is a little embarrassed since it has held the same QLD position as the market stealthily walks down to lower levels. Stealthily, right in front of its eyes.

Most years have at least one strong trend. If no major trend develops this year, the CMI will go trendless and friendless.

The CMI marches to its own drummer and doesn't care what the Coppock or Cheetum P/E Curve does, but here is what the updated Coppock and Cheetum P/E Curves say...

The long term "convincers" of a major market move are the Coppock Curve and the Cheetum Curve...at least in this jungle. The Coppock had given it's signal last May although the downtrend signals have been only 50% accurate over the years. Those who chose to sell using last May's sell signal would have been disappointed. The 80% accurate buy signal (lines upturning below the zero line) should get more attention. The real 'Coppock action' starts below the zero line as the indicating line starts its swing upward.



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The Cheetum Curve is meandering above the upper line so no major downtrend has been confirmed yet. A refresher on using this signal is outlined below.



1. A cross of the red ROC line over the black moving average line from below when both lines are below the lower blue horizontal line triggers a 'buy' signal.

Solid confirmation occurs when both the red and black lines cross through the zero line and then continue above the upper blue line. A reversal of the red line prior to crossing through the 'zone' would trigger a sell signal as noted by the yellow arrow.

2. A cross of the red line below the bottom horizontal blue line triggers a 'sell' signal. The black moving average line is not used as an indication of a sell.

3. If the lines are in the 'zero' zone (between the blue horizontal lines, continue with the previous trend. In other words, if they are in the zone, leave 'em alone.

Related posts:
Coppock Curve Update April 2011
Cheetum Curve Update March 2011