STOCK MARKET CRASH STOCK TRADING SYSTEM STOCK SYSTEM DAILY STOCK RANKINGS



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Crash Index Q&A

The Market Crash Index is provided to us courtesy of Pitbull Investor. It was developed by W. Henry Ford, developer of The Pitbull Investor (www.pitbullinvestor.com) mechanical stock trading system. This indicator usually signals a -10 about 2 weeks before a major market crash, and has NEVER FAILED to signal before a major U.S. Stock Market Crash!

Market Crash Index Signal Readings

    These are the significant things to look for on the Crash Index:

    -6

    SHORT TERM SELL SIGNAL - Exit or lighten long positions in that sector and move to cash.

    -10

    CRASH ALERT - Exit long positions in that sector, move to cash, increase short positions in that sector.

    +6

    ALL CLEAR / BUY SIGNAL - After a -6 Short Term Sell Signal or a -10 crash signal we will wait for a reading of +6 as the green light to start buying in on long positions again.

How Long After A -10 Do You Wait Before You Declare It A False Signal If The Market Doesn't Crash?

We will stick to our position until we see a +6.



Question: Todays reading is a -8 today, do I exit my long positions??

No.!! We do not act on this index unless it signals a Sell..When we get a reading of -6 we will be on alert, liquidating positions and keeping a close eye on the index. Waiting to see if it progresses to a crash signal. The crash index will often bounce between -6 and +10 in normal market swings, but when it reaches to the -6 or -10 point it is better to be safe than sorry.



Question: The Market Crash Index is at a +2, why is the market down today??

This is not a market timing tool designed to tell you if the market will close lower or higher today. It is designed simply to warn us before a major stock market crash with ample time to safely exit our long positions. This index is used as a leading indicator to warn of the possibility of a large negative drop in the market, (20% or more), as indicated by a failure in underlying market fundamentals.


Question The Crash Index Just Dropped from a +2 to a -4 what do I do??

Nothing!! ONCE AGAIN! We do not act on this index at all unless it reaches a -10..Once it reaches a -10 we will remain in cash until the index returns to a +6, at which time we start buying in on long positions again.Any reading other than a -10 (or a +6 following a -10) is insignificant.


Investor Guidelines for a -10 CRASH ALERT READING:

      • Exit or convert all margin positions to non-margin until the PCI signals all clear.
      • Exit all riskier 4 letter stocks( 4 letter meaning Nasdaq or OTC issues)
      • Increase short positions on selected stocks, (see Pitbull Shorting Selections)

This indicator has never failed to get us out in time for a major market crash, usually providing at least two weeks advance notice.

 

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