The McClellan Oscillator (MCOS) and corresponding Summation Index (MCSI) are one of the most sophisticated and powerful tools available to South African private investors. This page catalogues important historical activities of these indicators over 12 years to serve as regular reference.

When the MCSI breaches zero from above, it is typically a very bearish signal. It then usually enters two phases of tracement (wanderings) below zero - the down-leg and the up-leg. The down-leg is the very bearish period in time when the market (usually) experiences a correction. Then the MCSI recovers, turns around to form a trough and commences an up-leg to try reach zero again. Sometimes there is a false trough, but not many. Our SwissClock timing system has been designed to  figure out a way to eliminate being caught and entering the JSE on these "false signals". Once MCSI has breached zero it has historically NEVER bounced back quickly again.

Once we have determined that MCSI has made a trough and is turning around to commence the up-leg, this is normally a very BULLISH period for the JSE where very good returns can be achieved. So you see just because MCSI is below zero does not mean it is bearish times - this only applies to the down-leg.

The historical chart below shows the periods where MCSI traced its down-leg, super-imposed on the JSE so that you can observe how statistically, down-legs result in poor returns for the JSE. Click on the chart below to download a nice big 2500x784 chart (150Kb) you can really browse in nice detail.

The MCSI for the current day is the MCSI for the previous day plus the MCOS for the current day. The tracement of the MCOS for the last 12 years appears below. Click for much larger image.

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