The Hindenburg Omen: NASDAQ 100's Market Signal and Track Record

The Hindenburg Omen, a signal with a 100-year track record, is flashing on the NASDAQ 100, indicating potential market weakness.

### Hindenburg Omen: NASDAQ 100's Deadly Market Signal Triggered in 2024
* 🔔 The Hindenburg Omen, a market signal that was developed in 1937, has an impressive track record of **precisely signaling important peaks** on the NASDAQ 100 like 1987, 1999, 2017, and 2021.
* 📉 The signal triggers when there's a **large number of stocks in an index making new annual lows** while the stock market as a whole is **trending higher**, indicating **underlying weakness**.
* 📈 Since January 2023, the S&P 500 has advanced by **40%**, but an index that removes large tech companies' outsized contributions has only moved up by **15%**.
* 🕰 While the Hindenburg signal often occurs before large market corrections, the timing of the actual peaks can vary. In 2007, the signal reached the same strength as today in June, but the market **peaked in December**.
* 👀 If the signal continues to strengthen, it could start to resemble the **setups before the major crashes** in 2000 and 2008.
* 📉 When zooming out further in history, the Hindenburg signal doesn't have a perfect track record. It triggered a signal in 1997, which was followed by the NASDAQ 100 moving **higher for another 2 years**.
* 📈 Despite these warning signals, the S&P 500 is still in a **bullish technical structure** in 2024.

one of the most deadly market signals has just triggered on a major stock market index: the NASDAQ 100. The name that this signal has is even quite scary. It's something called the Hindenburg Omen, and unlike many market signals that are out there, it has a very impressive track record. It precisely signaled important peaks on the NASDAQ 100 like 1987, 1999, 2017, and 2021. The Hindenburg Omen is a signal that was developed in 1937, so we have almost 100 years of data to understand how good of an indicator this is. I'm going to show you its track record, why this is a signal that actually works, and what it means today in 2024. The fact that this signal was developed in 1937 is very important because it means that any signals provided after 1937 was a test of the quality of the Hindenburg Omen. This is rare. Most of the signals that you hear about have been specifically designed to work with the benefit of hindsight.

meaning someone can put together a formula and look at whether this was a good signal in the past. Before publishing it, if it wasn't a good signal, then they'll just keep on changing the formula until they stumble upon something that works. That is not the case with the Hindenburg Omen that was created in 1937. Every single time it was triggered since 1937 has been a test of the validity of this signal. So let's take a look at the track record of the Hindenberg Omen on the NASDAQ 100 over the last 25 years. It has been able to anticipate with a fairly good degree of accuracy significant Market Peaks like 1999, 2007, but also many of the most recent Market Peaks we've seen over the last decade like 2015, 2018, 2019, and of course the peak in 2021 just before a 25% drop on the NASDAQ 100. Today the Hindenburg Omen is flashing again. Now the signal isn't as strong as

it was in 1999 or in 2007, but the average stock market correction that followed similar signals to the one we have today was around 15%. So, it's worth taking a look at what is actually going on today. The Hindenburg Omen only triggers when there's a large number of stocks in an index that are making new annual lows, while the stock market as a whole is trending higher. This is not normal behavior. Under normal conditions, a large number of stocks are either making new annual highs or new annual lows. It's very rare to see both happening at the same time, but sometimes it does happen, and when it does, it means that although the stock market is rising and looks strong, underneath the surface, it's actually weakening and showing cracks. That's something we are seeing today. Since January of 2023, the S&P 500 has advanced by a staggering 40%, a very strong rally by historical standards. But when we look at an index called the RSP, we see it has only moved up by just 15%.

this RSP index removes any outsized contributions of large technology companies like Nvidia, Microsoft, or Amazon. So, this chart shows us that the stock market is essentially being pulled by just a handful of large technology companies. A large part of this strong performance we've seen on the S&P 500 is due to excitement around artificial intelligence, but we can definitely see the rest of the economy isn't really feeling the same excitement. Now, I want to be clear, just because the Hindenburg signal has often occurred before large Market Corrections, doesn't mean that's going to happen immediately. In 2007, the Hindenburg signal reached the same strength as we have today in June, but the stock market peaked in December of 2007, 5 months later. Similarly, in 2000, the Hindenburg signal reached the same strength as today in December, but the market only peaked in March of 2000, 3 months later. Now, 3 months might not sound like a lot, but many of you watching this video want to know what's going to happen to the stock market over

the next 3 months. Unfortunately, the Hindenberg signal does not provide us with much information on that. It does tell us, however, that the market is at risk of a much more substantial correction today, and that if the signal continues to strengthen, it could start to look like the setups we had before the two major crashes in 2000 and 2008. Now, I also want you to take this information with a grain of salt because when we zoom out a little bit further in history, we see that the Hindenberg signal doesn't have a perfect track record. You can see it also triggered a signal in 1997, which was not a great moment to be selling the NASDAQ 100 as it continued to move higher for another 2 years. It did, however, provide another great warning signal to investors as the market was topping in 1990 before quite a significant correction, and it also triggered a signal a few months before the market peaked in 1987, which was followed by the Black Monday stock market crash. Now, today, despite these

warning signals. The S&P 500 is still very much in a bullish technical structure, which is why throughout 2024, we've been quite aggressively long on the stock market. We've closed 31 trades so far in 2024, with some of the trades exceeding 30% gains and almost all of our losing trades being under 5%. We want to have a maximum number of large successful trades, but also make sure that our clients are avoiding large losses because poor risk management is the most dangerous part of trading, something we take very seriously at Game of Trades. We cannot guarantee that we'll continue to have these results looking forward, but we're doing everything we can to make sure that will be the case. You can join our service to access all of these

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The Hindenburg Omen: A Deadly Signal for the NASDAQ 100

The Hindenburg Omen, a market signal with a track record of predicting major peaks, has been a reliable indicator on the NASDAQ 100 since its development in 1937.

With a history of accurately anticipating significant market peaks, including the 2021 drop, its current flashing is a cause for concern in 2024.

The signal's consistent effectiveness sets it apart from many other market signals, as it has been tested and proven over almost 100 years, without the use of hindsight.

The Significance of the Hindenburg Omen in Today's Stock Market

The Hindenburg Omen is signaling abnormal stock behavior, with a large number of stocks hitting new annual lows while the overall market is trending up, indicating underlying weakness.

The S&P 500 has surged 40% since January 2023, driven mainly by a few big tech companies, creating a disparity in market performance.

Historical data shows that while the Hindenburg Omen is a precursor to market corrections, the timing of such corrections can vary, with peaks occurring months after the signal.

The Hindenberg Signal and Its Historical Impact

The Hindenberg signal is warning of a potential significant market correction, similar to those in 2000 and 2008.

However, its track record is not perfect, as it failed to predict the market movement in 1997 but successfully indicated market tops in 1990 and 1987.

Investors should consider this historical data while interpreting the current signal's potential impact.

Game of Trades' 2024 Stock Market Performance

Game of Trades has been aggressively bullish on the S&P 500 in 2024, with 31 trades closed, some resulting in over 30% gains and minimal losses.

The company prioritizes risk management to maximize successful trades and minimize client losses.

While they cannot guarantee future results, they are dedicated to maintaining their current performance.