Mikula Forecasting Company

MarketWarrior: Swing Projector Type #4 Sell Signal

The Type #4 Sell Signal uses the Swing Projector and the ADX. The charts below show the 1 minute chart for Apple Inc. Both indicators have been applied to these charts. When using a stock with less activity, it may be necessary to use a 5, 10 or 15 minute chart. This sell signal will be described as steps to make the process you are looking for as clear as possible.

1) First, the ADX needs to be at a high value. Normally this would be above the ADX Trend Level. We would also like to see the ADX start to turn down and begin to make a top.

2) Second, while step 1 is occurring, the Swing Projector must be showing the Warning Pivot Symbol. The Warning Pivot Symbol for a top is the red downward triangle with a "T" inside. On the chart below, you can see this setup. The ADX is making a top above the Trend Level and a Warning Symbol has occurred.

3) The final step is to see the price start to move down away from the Warning Pivot Symbol. When the price starts to turn down, the sell signal is given and you would look for an opportunity to sell short. On the chart below I have used the label "Top #1" so you can identify this same top on the next chart.




The chart below shows what happened after the Type #4 Sell Signal described on the previous chart. The label "Top #1" is the same on the chart below as on the previous chart. This shows that the market fell after the sell signal at "Top #1" was given. The label "Top #2" identifies where the next Type #4 Sell Signal was given. At Top #2 the ADX is above the Trend Level and is starting to make a top. The Swing Projector is also showing a top Warning Pivot Symbol. When these two events occur together, the Type #4 Sell Signal is given.


The final chart below shows the label "Top #2" to identify the same top with this label on the previous chart. This "Top #2" is where the Type #4 sell Signal was given. After the sell signal was given, the market had a swing back up to the price levels of "Top #2" but then fell quite a large amount.