McCurtain indicator update for Feb. 3

In Monday's update we said we continue to believe that extreme caution at least or a seller’s mentality at worst is the best course to follow in the weeks just ahead.

We are updating the daily chart of both indicators every day and providing the most recent raw data so you can begin to plot the indicators on your own.

Below are definitions of the indicators along with links to the original stories. Robert also describes these indicators in a recent I-Trade show presentation available online.

MAAD data for past 30 days* CPFL data for past 30 days

Date

NYSE Adv

NYSE Dec

Date

OEX Call $Volume

OEX Put $Volume

12-18-09

14

6

12-18-09

42985

60681

12-21-09

13

7

12-21-09

44113

59849

12-22-09

9

10

12-22-09

56358

58155

12-23-09

10

10

12-23-09

22741

71849

12-24-09

14

5

12-24-09

23354

19796

12-25-09

Holiday

12-25-09

Holiday

12-28-09

12

8

12-28-09

38736

27223

12-29-09

6

14

12-29-09

25008

36891

12-30-09

4

15

12-30-09

38511

21322

12-31-09

8

12

12-31-09

23350

40527

1-1-10

Holiday

1-1-10

Holiday

1-4-10

17

3

1-4-10

38165

39249

1-5-10

15

5

1-5-10

41864

20718

1-6-10

12

8

1-6-10

55939

32820

1-7-10

13

7

1-7-10

40339

33414

1-8-10

9

11

1-8-10

55056

31126

1-11-10

11

9

1-11-10

74407

73960

1-12-10

4

16

1-12-10

45919

51588

1-13-10

13

7

1-13-10

71500

56743

1-14-10

10

10

1-14-10

44095

36133

1-15-10

7

13

1-15-10

52195

72640

1-18-20

Holiday

Holiday

1-19-10

12

8

1-19-10

88318

51480

1-20-10

6

14

1-20-10

47829

74153

1-21-10

6

16

1-21-10

41110

141521

1-22-10

4

16

1-22-10

89311

276857

1-25-10

8

12

1-25-10

92904

140582

1-26-10

5

15

1-26-10

92447

152344

1-27-10

11

9

1-27-10

50997

76384

1-28-10

8

12

1-28-10

71376

145871

1-29-10

5

15

1-29-10

90158

163007

2-1-10

19

1

2-1-10

99416

150782

2-2-10

15

5

2-2-10

54523

84015

*Note: Unchanged issues are not counted.

Click on charts to enlarge

McCurtain Call/Put Dollar Value Flow Line (CPFL): CPFL is a dollar-weighted, options-based, divergence indicator that is plotted against an underlying index or issue to determine the “internal” health of the referenced instrument on a daily or weekly basis. So long as the CPFL remains in synch with the issue, the extant trend, bullish or bearish, should continue. When a divergence develops to the extent the CPFL fails to “confirm” price action (for example: the market index makes a new high, but the CPFL does not), the longevity of the underlying trend in the index is in doubt. CPFL can be plotted against any financial instrument that reports call and put data.

McCurtain described the CPFL in the November 2008 issue of Futures: “Options redux: 25 years into the revolution.” The indicator can also be referenced in “The Encyclopedia of Technical Market Indicators,” Second Edition by Robert W. Colby, CMT. McGraw Hill. 2003.

McCurtain Most Actives Advance/Decline Line (MAAD): MAAD is an indicator that reflects the market bias of so-called “smart money” to the extent large investors are committing funds, or withdrawing them, as reflected in daily and weekly Most Actives, exchange-based statistics. So long as MAAD continues to move in tandem with the index it is plotted against (the S&P 500 Index for example), the extant market trend should remain intact. But if, for example, MAAD begins to falter as the index continues higher, it should be presumed that astute investors have begun to sell into strength.

McCurtain described the MAAD in the June 2009 issue of Futures: “As smart money goes, so goes the market.”

Robert McCurtain is a technical analyst, market timer and private investor based in New York City. He can be reached at traderbob@nyc.rr.com.

Robert McCurtain’s CPFL and MAAD indicators, both described in past articles and in his recent I-Trade show presentation, have proven prescient and drawn a lot of attention by traders. Robert will provide a weekly update of both indicators and we will post the daily charts on futuresmag.com so check back to see what these important indicators are telling you.

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