DeMark Sell Signal

Many Technician's follow Tom DeMark's system/s, I personally never got too far beyond a basic understanding of his methodology, but I found it interesting enough to create my own DeMark inspired indicator; it is not anything like the Sequential (however I have seen some layouts of people who have set up DeMark indicators in StockFinder as its coding capabilities are extensive). Many of you have seen this indicator I use, which I really don't have a good name or really any name for other than the, "DeMark inspired" indicator.

In any case, the indicator only takes concepts from DeMark, it has nothing to do with 13 days really, but yet it has provided some amazingly accurate signals on all timeframes, I really don't give this indicator enough credit or feature it enough. I used StockFinder's BackScanner to really tweak the indicator to act like I wanted and to be robust in a variety of market conditions as well as assets. Maybe someone has a suggestion for a name for the indicator.

Here's the video discussing DeMark's call for a top in several European countries and the U.S. VERY close to a top, perhaps within days, which fits almost perfectly with all of the Trend #1 expectations that have so far been spot on. One of the most recent events that needed to occur in trend #1 for a reversal is we first needed to take out Friday December 4th's intraday high, the reason is to set up a head fake move, so it's not just about hitting the level although hitting stops and orders is one component of it, but more importantly if you have read the "Understanding the Head-Fake Move" article I have been publishing in parts, it's the demand and higher prices that are created on such a move that allow Wall Street to move out of big positions and start shorts, thin the size they trade and especially with volume as low as it has been the last several years, they need that demand and higher prices are just a given, they don't chase and they don't sell in to weakness unless they're in real trouble.

So DeMark's call is right there with our expectations. You may recall I said as early as last Monday, "We are not going to get good distribution signals until we are above that level) and as we moved above the level late last week that is the first day we started to get distribution signals. So I think what DeMark is saying fits very well not only with our expectations, but almost every concept we follow with regard to how the market works and behaves at reversals.

Here's the video on DeMark and below are several charts using my own indicator.

 DIA Daily buy and sell signals

 IWM Daily

IWM 2-day (The longer the chart, the more important the signal)

QQQ

 SPY

 Energy

 Financials

Technoology -as you know, the AAPL Call position is still open, still looking for a strong, but fast move. This isn't meant to be an AAPL update, but there are still some good signals to support the idea of that trade.

 AAPL 1 min saw a late day positive divergence Friday in to lower prices-classic accumulation.

 The 3 min chart, negative Friday morning on the highs after the gap fill and positive going in to the afternoon down-draft.

 5 min with immediate distribution in to an AAPL gap up as has been the case for the last several months, some smaller signals and the 5 min in an overall leading positive position.

The 15 min chart (Telechart) with a leading negative divergence in to the early January highs and a pretty large leading positive divergence in a very flat range (typically flat ranges are where we see some of the heaviest buying and selling, which probably comes as a shock to most people trained in classic Technical Analysis.

The point of the post really was the DeMark video, I thought I'd just add some of our flavor.