Bullish Percent Index ($BPXXXXXX)

Discussion in 'Technical Analysis' started by Babak, Sep 14, 2002.

  1. Babak


  2. This is the info as i know it (although it could be wrong):

    ChartCraft (New Rochelle, NY) is the creator of the sector bullish percent indexes. I think they differ slightly from StockCharts.com indexes due to the specific universe of stocks that make up the indexes. Has EXTENSIVE historical data (for a fee), but if you call them i bet they'll even customize the data for you. Prices are fairly reasonable. They were a little late to utilize the web and mailed out charts on a speceific timeframes to their customers, although i'm pretty sure they now have a website, although i haven't seen more than their homepage.

    DorseyWright and Assoc: pretty much made use of Bullish Percent charts (and more so, Point and Figure charts) ubiquitous. Writes a daily market letter for professionals (which includes access to their point and figure charts) as well as non-professional version (cheap, maybe $20/month) which does NOT include the market letter, but gives access to their web based charts. I don't think their charts go back to a specifc timeframe, it's based upon how volatile the sector is and what fits on the page. You may be able to call them and ask them how far back their data goes.

    If you have any add'l questions, feel free to post.
  3. o. I guess the Schaeffer's thing isn't an index at all. Sorry.
  4. Babak


    So there absolutely is no source on the internet that is free and provides more historical data than 3 years?

    That's possible but a little hard to believe.

    Thanks for everyone's links/info.
  5. Babak,

    Are you familiar with what the Bullish% measures? (i say this with respect, as i'm you are a moderator, and i'm just one of the common folk).

    If not, i'll give a BRIEF tutorial, and if you want more info, you can post or PM me, depending upon any other lurker's interest. Bullish percent charts take a universe of stocks, in this case a sector (let's say the Bank stocks), and shows the percent of stocks in that group that are on "buy signals." To oversimplify things, it is traditionally suggested that a low risk time to buy is when the Bullish% is below 30% and then turns up. A high risk time to buy is when the Bullish% is above 70% and then turns down.

    Getting back to the Bank Bullish%, you see how there could be a discrepency in your bullsih% chart and my bullish% chart, if you include a company like CitiGroup in the bank sector and i include it in the Brokerage Sector (just one stock in a large universe wouldn't make that much of a difference, but what if the universe is small (only 25 stocks in the sector), then each stock could account for 4%!! Also, using the same example, what about stocks like JPM Chase... as you can see the list continues and the universe could be subjective (we haven't even begun to consider stocks that are micro-cap, or have such a low float that only trade a few times a day or week... do we include these in the universe or not?))

    As i stated above in my first post in a roundabout way, these charts were first created for use with Point and Figure (PnF) charts. If the underlying stock charts are not in PnF format, i think the rest of data could be inconclusive as how would you determine if the underlying stock chart is on a "buy signal" or a "sell signal". PnF charts are the only ones that i know of where there is no subjectivity in determining whether a stock is on a buy or sell signal.

    I consider myself VERY knowledgable in the area of PnF charts and Bullish% charts (although i have yet been able to figure out how to make money using them:) and would be more than happy to help you out in any way that i can. I probably have a few years worth of data, but not in raw form, i only have the Bullish% charts in PnF format, but i'd have to dig it up. I've also done some back testing and couldn't find any hard and fast rules to go by to make it profitible (who knows, maybe putting both of our heads together could come up with something?)

    Let me know if you have an interest in discussing any of this further, either on/off the board.
  6. The Bullish Percent indicators are Stockcharts proprietary indicators. The indicator is the % of stocks in a sample which shows a bullish point and figure chart, and I think what they consider bullish p&f may not be standard. Not sure.
  7. Babak



    lol, I'm one of the more commoner folk around here. I'm just a cyber busboy asked to clear the tables and the mop up before the next guest arrives.

    I do have to admit that I'm not as knowledgeable as you when it comes to PnF charts. I guess I should have explained further what I was looking for exactly. I'm aware of the way a $BP index is created however because of the difficulty in deciding what security to include in which sector, I am only interested in wide exchange indexes ($BPCOMPQ for Nasdaq $BPNYA for NYSE, etc.).

    The reason why I am interested in this is that I noticed a while back that at extreme points it flags significant market tops/bottoms. Of course, this is not really news to anyone! :D

    But I wish to add it to other such "indicators" because I feel that although one may not be 100% accurate or provide a correct picture at one point, when several different perspectives all agree, the likelihood of a move/up or down is much larger.

    I'm a bit confused why you would not have been able to find a way to profit from the $BP indexes. Perhaps it is because you are using the sector indices rather than the more broad ones that I watch?

    I'll take you through how I think about the $BPCOMPQ:

    Measures above or equal to 55

    Feb '01 beginning of month>>top
    May '01 end of month>>top
    Jan '02 middle of month>>top (a bit off)
    Mar '02 end of month>>top (a bit off)
    Apr '02 middle of month>>top

    Interestingly the mother of all tops formed in Mar '01 was reflected in a more muted 50 reading on the $BPCOMPQ index. However the index was congested in that area for more than 2 months.

    When I say 'top' in the above table, I mean bang on or very very close. When I say 'a bit off', I mean the $BPCOMPQ didn't flag the top, due to a small (week) time difference. You can follow what I mean by referring to this chart:


    Again, the problem is that I only have 3 years of data and can't really say with any certainty the validity of these signals in the long term.

    How are you using the $BP indices?
  8. Bullish % charts were not originated by Stockcharts. Atin Maliya (sic?), wrote the program for the PnF charts on that site ( he's a regular contributor on SI), and I believe he emulates Chartcraft's
    way of calculating it, but as posted earlier the exact stocks used in the calculation may differ.