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McClellan Summation Index

The McClellan Summation Index is a market breadth indicator developed by Sherman and Marian McClellan. It is a long-term version of the McClellan Oscillator and its interpretation is similar to that of the McClellan Oscillator except that it is more suited to major trend reversals.

For more extensive coverage of the index refer to the book Patterns for Profit, by Sherman and Marian McClellan.

McClellan suggests the following rules for use with the summation Index:

  • Look for major bottoms when the Summation Index falls below -1300.
  • Look for major tops to occur when a divergence with the market occurs above a Summation Index level of +1600.
  • The beginning of a significant bull market is indicated when the Summation Index crosses above +1900 after moving upward more than 3600 points from its prior low (e.g. the index moves from -1600 to +2000).

The summation index is plotted by adding the Cum function to the McCllellan Oscillator. The formula is:

Cum(Mov(C,19,E) - Mov(C,39,E))

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