The S&P500 Equal Weight Index removes the distortional effect created by the Top 10 “weighted” big cap stocks. In addition, we’ve found the signals in the lower two panels to be reasonably effective in generating buy signals. These triggers help us determine when a fade has reached a climax.
S&P500 Equal Weight Index
Buy signals are confirmed when,
1) the number of stocks trading above the 50d moving average (SPXA50R) turn and pivot from a low reading (green zone)
2) CCI pivots and turns from a low reading. Final confirmation comes with VIX dropping from an overbought reading.
3) Monitor VIX after the Opening Range for confirmation
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