This post will add current view and refresh on my take on these types of signals.
The signal I have been using is the S&P 500 index Weekly SMA (Simple Moving Average).
This trendline takes the weekly stock market value and averages it over a duration, in this case I use 50 week and 20 week moving averages.
If the 50 week goes higher than the 20 week, this is an indicator of a market trend change down, if the 20 goes above the 50 week, this is an indicator of market trend change up.
Another popular indicator is daily SMA 200,50. Work on same principal but uses daily instead of weekly moving averages.
These indicators are important to help people try to remove the emotional attachment of their positions to a neutral indicator. Also there is a herd mentality effect. Professional traders are aware of these indicators are used and it can become self-fulfilling.
All indicators are not predictions, simply a datapoint to respectfully consider your disposition.
For a more indepth review, please see the original video I watched to learn about this.
Below are weekly and daily SMA for your viewing.
Click these links for current weekly and daily charts.
