A "double nine-to-one" signal was triggered Tuesday

Discussion in 'Trading' started by ASusilovic, Mar 19, 2008.

  1. The Dow Jones Industrial Average ended the day with a gain of 420 points, the biggest one-day point gain in more than five years.

    But there's more reason for the bulls to cheer than the magnitude of the day's point gain. Tuesday's action also was strong enough to trigger a bullish technical event known as a "Double Nine-To-One" signal.
    This indicator is based on the volume of all NYSE-listed stocks that go up on a given day, expressed as a percentage of the total volume of all stocks that rose or fell on that day. On a day when rising stocks' volume is the same as declining stocks' volume, for example, this ratio would be exactly 50%.
    A single "Nine-To-One Up Day" occurs when this ratio is 90% or higher on a given day. According to Martin Zweig, who helped to develop this indicator several decades ago, such a huge imbalance of up volume over down volume "is a significant sign of positive momentum. In other words, when daily up volume leads down volume by a ratio of 9-to-1 or more, that tends to be an important signal for stocks." The quotation comes from Zweig's 1986 book, "Winning on Wall Street."

  2. I wonder if a couple more "nine-to-one" down days invalidate the signal? :p
  3. This indicator could possibly be correct almost half the time
  4. dsq


    Btw this frikkin rally was on half the avg volume.Its a dud rally.

    i remember in the early 90s they used to define this double 9 nonsense as a 10-1 day and you needed 2 consecutive days like this to confirm the validity of trend reversal...maybe my memory is off but i am pretty sure the definition has been changed to suit however they want to loosely interpret things.
    Please also note the last big300-400 pt jump just happened on march 9th(?) and the same bullshit excuses were being hyped.The market quickly retested lows.Doesnt anyone remember that?This is pathetic how wall st has an attention span of 2 seconds max.No wonder bsc chairman lied his ass off last wednsday.

    By the way real estate is just in the beginning of a long nightmare-banks too.These problems didnt go away yesterrday cuz wall st stroked itself...

    Whatever happened to zweig anyway?
  5. It is also known as a lowry up day. The other criteria is ratio of stocks up to dn is > 90%. These events have a very significant correlation to long term bottoms.
  6. Suss-----The "problem" with that type of day is that it usually occurs in close vicinity to a long-term bottom preceded by large down-days. People use that type of rally to get out of the market instead of in. We'll see how "it"did in 59 days. :cool:
  7. piezoe


    Now that we have heard from the "double nine to one" people, isn't it time for the Elliot wave advocates to weigh in? :D
  8. Wrong. It's only correct almost 50% of the time, when Venus is in Aries.
  9. dsq


    hahaha!ya,5th wave of a third wave of the B wave,right?
  10. Arnie


    Or maybe it's a sign of short covering?
    #10     Mar 19, 2008