Bull Bliss: MagicT Gets Markets High

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Bull Bliss: MagicT Gets Markets High - By: Murray Nickel, Posted on: 2007-08-09

August 8th, 2007

MagicT isn't to do with mushrooms or hot beverage. It is short for "Magic Trough".

It is a trading signal I developed as part of my TrendSensor trading system. It can identify very early when panic selling is exhausted and a new rally is kicking off. It catches the end of the nastiest, most precipitous declines and delivers a buy signal early in the new, strong rally that usually follows.

Interested in technical analysis of markets? (skip this paragraph if you're not!) OK, here's the nerdy stuff: MagicT uses time series analysis of price volatility, a statistical analysis of trend duration to identify excessively long trends, and a simple chart pattern to nail the start of a strong rally following panic selling.

Paste the URL below into your browser and you'll be taken to a chart of the DAX Index (Germany) covering 14 years, two bull markets and a bear market. The 16 buy signals are the work of MagicT and you'll see 15 of them are nicely nestled near the bottom of market troughs (low points).

www.trendsensor.com/Charts/DAX-LT-MagicT.png

As you can see, most of the significant lows are nailed by MagicT, and the only signal that's clearly not timely is the first one in 2002.

I chose to show the DAX because it's primed to trigger a MagicT signal again soon, and it has more historical signals than most markets - 16 in 14 years. Many markets only serve up a MagicT buy signal once every two or three years. So the fact that right now I can identify 14 global stock markets or sectors that are primed to trigger a MagicT buy signal is remarkable and bullish. A few of these may not fulfill all the signal requirements within the time frame allowed, but there are 10 markets that appear very likely to throw MagicT buy signals within the next week or three. These 10 markets are evenly split between Europe and USA:

* Europe: ATX (Austria), BFX (Belgium), CAC40 (France), DAX (Germany) and FTSE100 (UK).

* USA: BIX (S&P Banking Sector Index), HGX (Philadelphia Housing Sector Index), NYA (NY Composite), SPX (S&P 500) and SXX (Philadelphia Semiconductor Sector).

When MagicT rides into town within the next few days, it probably signals the start of the last excellent buying opportunity within the US and European markets for a long time to come.

This opportunity is a heads-up for all my trading signal clients - and an invitation to catch those rare MagicT signals via my free 5 week trial offer for others reading this.

Article Source: http://higradesearch.com

Murray Nickel is a mathematician, statistician, and professional trend trader. He offers a free trial of trading signals for market indices and index ETFs, spot Forex, and spot Gold. He also mentors trend traders aiming to excel at trading global markets.
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