Our Methodology

Our proprietary set of indicators measure many aspects of the markets and provide a unique perspective of market dynamics not available to average investors. Our Risk, Extremes and Accumulation Index indicators are combined with advanced trend tools to generate our BUY and SELL signals.

5 Factors that Predict Market Direction
Included in PerformanceSignal analysis are the five factors that are proven to effectively predict market direction. 

 The 5 factors are...

  1. Trend Velocity (Trend direction is not enough- velocity is more predictive)
  2. Price Trend Analysis (Trend on all time frames)
  3. Risk Index Analysis (Our own proprietary deflationary Indicator)
  4. Extremes Index Analysis (Our own Proprietary Statistical and Sentiment Extremes Index aka PSI)
  5. Accumulation Index Analysis (measures institutional buying and selling)

Most indicators and data that are available to the public are useless and it can take way too much time out of your day to filter through all the information that is available and try to decide on what might be important.

The good news is that you don't have to - we have already done it and we include it with your PerformanceSignal subscription, you get this insight backed by years of research and analysis for less than the price of a financial newspaper.

Our proprietary indicators track over 50 measurements of market participation to put the highest odds in your favor

We painstakingly collect data along with many other important but often misunderstood pieces of information and paint a picture of what is likely to happen in the stock market. The effectiveness of our proprietary indexes comes from our method of scrubbing data to remove anomalies and arranging it in such a way as to show trends and extremes then converting that insight into one coherent indicator that is PerformanceSignal. 

PerformanceSignal backed by our proprietary indicators and indexes clearly marks points of market rotation that are not obvious to the public. PerformanceSignal showed extreme selling by smart money participants in the year 2000 just prior to the nearly three year bear market that followed and has since marked every major market turn. 

Trend following combined with our proprietary indicators and indexes - the winning combination.

Price trend reflects the actual decisions of market participants regardless of what seems to face the market - it's a graphical representation of how they actually position their money after analyzing all that is known. Price incorporates all of the news, economic data, geopolitical concerns, earnings growth and all variables and represents it with a bar on a chart. We measure the two most important factors of trend - Price trend direction and price trend velocity.

Price trend is important but trend velocity is even more important and more predictive. We have a proprietary system for measuring pure trend velocity on all time frames. Our research and backtesting points clearly to the importance of trend velocity and yet, how often do you hear professionals on CNBC or market timers that are being interviewed mention trend velocity? This is just one very important difference that sets us apart from the crowd and of course, we are bold enough to post our third -party verified results each week to prove it. 

Trend following confirms our index data and marks points of entry and exits, it forces us into the market at or near the beginning of significant advances or out of the market before significant declines. 

The trend-timing component of our signals is a robust set of indicators that work in conjunction with our proprietary indexes to get us invested and keep us invested in front of major market moves. 

The weakness of trend systems by themselves is their habit of flip-flopping in choppy market conditions, which severely hurts performance - we avoid these inherent problems with the use of our unique indicators working in tandem. The combination of our proprietary index data combined with our multi-tiered trend indicators is the secret to our success as the combination has helped us to identify major market turning points and avoid false signals. Check out our results page for past signals.

Our Basic Approach

Our model is based on our studies of the Nasdaq 100 index, which most often leads other indexes. Generally during BUY signals, subscribers enter stock funds, Nasdaq 100 index ETF's or leveraged Nasdaq 100 index funds. Conservative investors can take a diversified approach which will include using a portion of their buying capital  for small cap stock funds, large cap funds, and international diversified funds. The advantage to our strategies is that you can make money when the market moves down with inverse mutual funds and Exchange Traded Funds (ETF's) or simply by shorting ETF's or baskets of stocks during our SELL signals, thereby potentially doubling returns. For the very aggressive, our signals can be used with leveraged ETF's for spectacular gains while still controlling overall volatility.

There are some basic rules. First there are three signals- BUY, SELL and CASH. In a BUY signal we want to be invested or LONG stock indexes. In a SELL signal, We want to either be in safe cash equivalent investments or short the market to profit from declines. In a CASH signal we want to be on the sidelines protecting hard earned capital and await the next best opportunity. Our signals are generated by 8:00PM EST and explained in full in our email and on our website. The investor simply makes the adjustments as soon as possible, preferably by the open of the stock market the next day and then awaits the next signal. As a matter of safety, we apply a 7% stop loss at the beginning of every signal based on the Nasdaq 100 index just in case geopolitical or major events cause unusual price action.

Our service offers serious investors optional weekly in-depth market commentary that includes short-term market direction, indicator explanations, and interesting charts while we offer a scaled down weekly newsletter via email that covers the basics for those of you that prefer simplicity.

We have purposefully kept our service affordable to allow even novice investors the chance to get superior market insight without the need to sacrifice much-needed investment dollars.

Need more information? send us an email at  support@performancesignal.com


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