But the tide may be turning for the bulls. The $NYSI gives a good indication of where the market might be heading but more importantly they give a signal of a reversal. Lets look at the last 3 years. (I recommend clicking on the graphs and viewing them first).
Two things I am noticing, first is that the NYSI was PERFECT in predicting the bottom. When the $NYSI is below a -1200 it signals a bottom. It hit -1000 and turned up. Had I followed this system, I would be very happy now.
Secondly the ATR which measured the voliatily of a security, has slowly stalled. Which means the $NYSI has not made large moves up lately. This could be an affect of the advancing stock losing momentum because the market appears to be overbought. A lack of movement in the $NYSI, could signal a that the $NYSI is stalling and the potential for the market pulling back and heading down, could be there. You can see from the chart when the $NYSI turns, it signals the market is rolling over. The last time the ATR of $NYSI was at these levels it was right before the last leg down in late Feb and early March.
Here is a better look at the $NYSI with the $SPX.
So what to watch, there are a few things.
1-Will the $NYSI roll over, if it does it could signal a new down-leg for the market or a pull back.
2-Will the $NYSI keep climbing and does this mean that a bottom is in.
3-Will the $NYSI pull back a little and begin to move up again.
I believe we are still a few more days from seeing the $NYSI rollover but I think it is starting too.
