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Hindenburg Omen
The Hindenburg Omen is a technical indicator named after the famous crash of the German airship called the Hindenburg in the 1930's. The sole purpose of the Hindenburg Omen is to predict market crashes.
Last updated: 16-Aug-2010
What is Hindenburg Omen?
The Hindenburg Omen is a composite indicator. i.e. it is made up of several indicators. The following criteria need to be met for the Hindenburg Omen to exists:
- The number of securities making new 52-week-highs should be above 2.2% of the total number of securities traded on the NYSE.
- The number of securities making new 52-week-lows should be above 2.2% of the total number of securities traded on the NYSE.
- The McClellan Oscillator must be negative
- The 50-day moving average must be rising
- New 52-week-highs are not more than twice new 52-week-lows
It is claimed that the Hindenburg Omen has preceded every major market downturn since 1985.