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The Weebling's McClellan Oscilator — Indicator by vereweedus
The McClellan Oscillator is a market breadth indicator that is based on the difference between the number of advancing and declining issues on a stock exchange, such as the New York Stock Exchange (NYSE) or NASDAQ.
Here is the formula
I use the McClellan to look for Local Capitulations, it is a proxy that i use to find people being forced to cover their long position leading to a squeeze to the bottom
This is seen as NYMO (New York Exchange McClellan Oscillator) tracks the entire exchange from small, medium, and large cap stocks. This is why it is a good proxy.
When the NYMO crosses below -80 that is a good signal that the market is in a local capitulation as many stocks are being sold off quickly and the indicator would flash blue, but do not buy in yet. The BUY signal happens on the first day after the blue bar is no longer flashing
DO NOT USE THIS ALONE. Despite having one of the best track record, this is not something you should ever use alone. It points to a local bottom forming, but it does not mean that it is THE bottom. It does not promise a bottom, but it is telling you that the environment is set up for a bottom to happen, so act accordingly and execute it with a sound trading strategy.