Analysis of Early Trend Reversal using TCBYC Indicator
The TCBYC is an indicator that reads the price directly. It was derived by Mr Bharat Jhunjhunwala in his course of writing the MFTA paper. This is a very effective indicator and has proved its worthiness in predicting early corrections and even trend reversals.
This indicator is based on RSI and daily volatility, it has an edge to read momentum as well as the volatility at the same time.
The RED FLAG signal appeared on 30th January 2018, when Nifty was trading near it life highs. This signal indicates an impending correction, though confirmation is required! On the 2nd of February 2018 this signal got confirmed and Nifty corrected more than 500 points. Mixing this indicator with RSI skills and BXTrender (proprietary indicator developed by Bharat Jhunjhunwala) gave full evidence of this melt down.
On 7th March 2018, a Green Flag signal appeared, this signaled wrapping up of shorts momentarily. Though a reversal signal is awaited.