The Coppock Curve Buy Signals of 4/28/78 and 5/30/03
A previous communication showed that the two deep Monthly DJIA Coppock Curve buy signals of 4/28/78 and 5/30/03 were the only ones since the 1920's not to be preceded within 600 trading days by at least one instance of the smoothed CI-NCI Ratio dipping to 0.9500.
Are these two signals uniquely akin in any other respect? Consider the time path generated on a scatter chart by plotting the smoothed CI-NCI Ratio against the inverted and smoothed NYSE TRIN, from 12/1/61 to 5/30/03, with both smoothings accomplished by applying six 10-day moving averages. At first glance that time path appears unintelligible.
Of the 8 deep and very deep Monthly DJIA Coppock Curve buy signals since 12/1/61, 5 deep ones (1/31/63, 4/28/67, 8/31/70, 9/30/82, and 10/31/88) were preceded by one dip in the smoothed CI-NCI Ratio to 0.9500 within 600 trading days of the signal; and 1 very deep one (1/31/75) was preceded by 2 such dips. Of interest in these 6 cases are those trading days from the date the smoothed CI-NCI Ratio (last) reached 0.9500 (to the downside) to the date of the signal itself. Highlighting those 6 time spans 2 at a time on the chart reveals 3 distinct patterns.
We know the two remaining signals (4/28/78 and 5/30/03) were not preceded within 600 trading days by any dips in the smoothed CI-NCI Ratio to 0.9500. Of interest in each of these 2 cases are the 600 trading days comprising the time window in which 1 or more dips might have taken place but did not. Highlighting both of those time spans together on the chart reveals a 4th pattern. Thus, as to pattern too, 5/30/03 is uniquely akin to 4/28/78.
Incidentally, most of the 7 signals shown in the DJIA chart below were big winners. The 4/28/78 signal, however, was not.