William O'Neil sell signal

Discussion in 'Strategy Development' started by trend_guy, May 25, 2007.

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  1. Im missing the sell signal. There was no high volume without further price movement upwards. The markets have been moving pretty nicely...

    The confirmation is if the second rally fails, but you can't confirm something that has not happened. And there has been no failure as of yet.

    I'd say there was a better example of distribution on april 17th... but the market continues to go up.

    Something to keep in mind... even though O'Niel believes you can call a top within the first few days it happens (which I dont know if it is possible or not... I am not that talented but maybe others can do this), he states that your positions will dictate if the market is topped.

    If you are getting stopped out on everything, its time to get to the sidelines until you know the direction once more.
  2. I agree, just something to consider if your positions start getting stopped out... I think you have to let your positions play out.

    Also of note... sometimes these distributions only lead to very small rest periods, like 3-5% or less.
  3. nkhoi

    nkhoi Moderator

    I have a service recomm to short the market on this very signal since 3/29, all his recomm positions are under water right now but he firmly stay commit.
  4. I think the service is missing the point (or at least being very stubborn) of O'Niels signal... at least in terms of let the market tell you when you are right. O'Niel never advocated for going against the market even when "sell" signals came up.

    I do agree with you trend_follower though... I know a lot of people are bearish right now, though and the direction is up.

    I just find it funny that people never stop calling tops. I'm glad I learned not to do this early on and have little bad habits with regards to this.
  5. for sure... the big money is made in run away bull markets... my goal is just to always be aware of risk because us smaller traders have the advantage of being nibble. Thanks for your comment guys.
  6. ==================
    Trend T;
    And William O Neil has more than distribution days as sell/short signals

    Actually, from reading IBD, most of his books,
    thru Bull & bear markets , his charts almost always have 50dma,200dma on them.

    50 day moving average keeps you mostly on right side of market on 2-27-07 thru3-21-07 thru now, even if it doesnt work that precisely in the future.:cool: