Hindenburg Omen: Why equity investors should be very afraid
Perhaps the clue is in today’s date, Friday 13, but equity investors should be very afraid if the reappearance of a US technical indicator believed to herald an imminent market crash is to be believed.The ‘Hindenburg Omen’ is the ominously-titled list of five separate indicators linked to the New York Stock Exchange which when they occur at the same time, have historically warned of an impending crash.
Named after the tragic events of 1937 when the zeppelin airship Hindenburg dramatically exploded into flames in New Jersey, influential US market blog Zero Hedge reported over night that the five technical indicators appeared to have occurred last Tuesday.
In fact Zero Hedge describes the Hindenburg Omen as: ‘Easily the most feared technical pattern in all of chartism (for the bullishly inclined).
Those who know what it is, tend to have an atavistic reaction to its mere mention.’
