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Tom McClellan @McClellanOsc
, 5 tweets, 1 min read Read on Twitter
Here is some interesting trivia about the statistics on New Highs (NH) and New Lows (NL). The modern history of these data begins in 1980 because that is when the procedure for keeping track of NH and NL got changed to the current practice. (1/5)
Before computers, the records were kept on paper ledgers, one page per stock, and per year. Every year the record keepers would start a new ledger. (2/5)
But they could not use only the trading records for the first week of January, as that would give misleading answers. So they would factor in the extremes of the prior year’s prices for a while, until the new year’s ledger was more fully populated. (3/5)
Then along around April each year, they would switch to only the new year’s ledgers. This meant that rather than the standardized 52-week lookback period now used in the NH and NL data, it would vary from 4 to 16 months. (4/5)
So while such NH and NL data exist before 1980, they are not comparable. That is why only the 1980 and subsequent NH/NL data are suitable for purposes such as counting Hindenburg Omens. And in this modern era, this ties for the biggest cluster of them. (5/5)
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