SPX 14-bar RSI Revisited
By
Rennie on Monday, January 10th, 2011 at 11:35 am
Last week the 14-day RSI for the SPX spent all five sessions above the 70 mark, a bullish indication looking out 1-2 weeks. Over the past 30 separate occurrences stretching back to 1987, 93% led to a higher S&P close 5-9 trading days later, indicating we’re likely to see the S&P close back over 1271.50 at some point in the January 14th-21st time frame. See this New Years eve column for a recent track record. In addition, I’d note that a lower S&P close today will represent the first sub-70 RSI reading since it initially closed over 75 back on January 3rd. This too will trigger a one-week buy signal. Following a 14-day RSI close over 75, the first sub-70 reading has led to a higher S&P one week later 80% of the time since 1986, significantly above the 56% random chance in the same time frame. See last Monday’s column for the track record.
SPX 14-bar RSI Revisited
By Rennie on Monday, January 10th, 2011 at 11:35 amLast week the 14-day RSI for the SPX spent all five sessions above the 70 mark, a bullish indication looking out 1-2 weeks. Over the past 30 separate occurrences stretching back to 1987, 93% led to a higher S&P close 5-9 trading days later, indicating we’re likely to see the S&P close back over 1271.50 at some point in the January 14th-21st time frame. See this New Years eve column for a recent track record. In addition, I’d note that a lower S&P close today will represent the first sub-70 RSI reading since it initially closed over 75 back on January 3rd. This too will trigger a one-week buy signal. Following a 14-day RSI close over 75, the first sub-70 reading has led to a higher S&P one week later 80% of the time since 1986, significantly above the 56% random chance in the same time frame. See last Monday’s column for the track record.