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.

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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.