Chaikin Buy/Sell Signals

At first glance, these look like the sort of signals you might find in any number of sources that address technical analysis or trading. But there is a big, and very important difference: The Chaikin Power Gauge rating, which includes not just technical considerations but also a hefty dose of fundamentals, is part of almost every signal.

The ChaikinAnalytics.com Resource Guide lists six pairs of signals, each containing a set of Buy protocols and a set of mirror-type Sell protocols.  

The six pairs are:

      1. Overbought/Oversold
      2. Momentum Breakout/Breakdown
      3. Reversal
      4. Money Flow
      5. Relative Strength
      6. Relative Strength Breakout/Breakdown

Here are details of each set of signals.

NOTE:

  • OBOS = Overbought/Oversold indicator
  • EMA = Exponentially Weighted Moving Average
  • EMA 5 of EMA 5 = 5-day Exponentially Weighted moving average of the 5-day EMA of the stock price
  • DEMA = Double Exponential Moving Average
  • MF = Money Flow
  • MFP = Money Flow Persistence (the percentage of daya in which MF was positive)
  • RS = Relative Strength

Overbought/Oversold

These suggest stocks that are ripe for trend reversals.

Oversold Buy

  • Stock closes at an 8-day low while
    • Price is (Oversold per “OBOS” Indicator (less than 30)
    • Power Gauge rating is BULLISH

Overbought Sell

  • Stock closes at an 8-day high while
    • Price is Overbought per “OBOS” Indicator (greater than 80)
  • Power Gauge rating is BEARISH

Momentum Breakout/Breakdown

These suggest stocks that have broken out of a trading band (or range) with indications that momentum in the direction of the breakthrough is likely to continue

Momentum Breakout

  • Stock crosses through its upper band while
    • Stock is outperforming (Chaikin Relative Strength is greater than 0.60)
    • Chaikn Money Flow indicator is positive (above 5), and
      • Chaikin Money Flow Persistency indicator is strong (above 50)
  • Power Gauge rating is BULLISH

Momentum Breakdown

  • Stock crosses under its lower band, or
  • Stock becomes very oversold (OBOS Crosses under 17) while
    • Stock is not outperforming (Chaikin Relative Strength is under 0.40)
    • Chaikn MF indicator is weak (below -5), and
      • Chaikin MFP is not strong (below 60)
  • Power Gauge rating is BEARISH

Reversal Buy/Sell

These are stocks that are reversing direction relative to the market with momentum in the new direction likely to continue

Reversal Buy

  • Stock crosses above its 21-day EMA while
    • Stock is not outperforming (Chaikin Relative Strength is under 0.60)
    • Chaikin MF is not very weak (above -10)
    • OBOS is not overbought (below 70) and either
      • OBOS is oversold (below 30), or
      • OBOS is rising
  • Power Gauge rating is BULLISH

Reversal Sell

  • Stock crosses under its 21-day EMA while
    • Stock is not underperforming (Chaikin Relative Strength is above 0.30)
    • Chaikin Money Flow indicator is not strong (below 10)
    • OBOS is not oversold (above 30) and either
      • OBOS is overbought (at or above 70), or
      • OBOS is falling
  • Power Gauge rating is BEARISH

Money Flow Buy/Sell

Stocks with strong or weak Money Flow (a Chaikin indicator that uses price and volume to measure flow of funds into or out of a stock) and short-term momentum that seems likely to persist

Money Flow Buy

  • Stock crosses above a rising trend defined as the 5 day EMA or the 5 day EMA (a double EMA) while
    • Stock is above its 21 day EMA
    • Chaikin MF indicator is not weak (above 5)
    • OBOS is not overbought (below 70) and either
      • OBOS is oversold (below 30), or
      • OBOS is rising
  • Power Gauge rating is BULLISH

Money Flow Sell

  • Stock crosses under its 31 day EMA while
    • Stock is below 5 day EMA of its 5 day EMA
    • Chaikin MF is weak (below 0)
    • OBOS is not oversold (at or above 30) and either
      • OBOS is not overbought (below 70), or
      • OBOS is falling
  • Power Gauge rating is BEARISH

Relative Strength Buy/Sell

Stocks outperforming or underperforming) the market with momentum trends that suggest likely continuation of that movement

Relative Strength Buy

  • Stock crosses above its 21-day EMA while
    • Stock is above 5 day EMA of its 5 day EMA
    • Chaikin Relative Strength is strong (at or above 0.60)
    • OBOS is 
      • OBOS not overbought (below 70), or
      • OBOS is rising
  • Power Gauge rating is BULLISH or NEUTRAL

Relative Strength Sell

  • Stock crosses under its 21-day EMA while
    • Stock is below 5 day EMA of its 5 day EMA
    • Chaikin Relative Strength is weak (at or below 0.30)
    • OBOS is 
      • OBOS not oversold (above 30), or
      • OBOS is falling
  • Power Gauge rating is BEARISH or NEUTRAL

Relative Strength Breakout/Breakdown

Strong (or weak) stocks that further strengthened (or weakened) to outperform (or underperform) the market

Relative Strength Breakout

  • Chaikin RS crosses over 0.60 while
  • Power Gauge rating is BULLISH, or
    • Stock is above its DEMA, and
    • OBOS is not overbought (below 70)

Relative Strength Breakdown

  • Chaikin RS crosses under 0.30 while
  • Power Gauge rating is BEARISH , and Chaikin MF is below 20, or
    • Stock is below its DEMA, and
    • OBOS is not oversold (above 70)