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McClellan Oscillator by Tom McClellan: Master Market Breadth & Momentum Analysis
Learn to read the market like a professional trader with the McClellan Oscillator and its powerful suite of companion tools. Developed by Sherman and Marian McClellan and advanced by Tom McClellan, this methodology transforms the way you interpret market momentum and breadth.
What Is the McClellan Oscillator?
The McClellan Oscillator is a market breadth indicator that helps traders gauge momentum shifts in the stock market by analyzing the relationship between advancing and declining stocks. Originally introduced in 1969, this oscillator remains a reliable and time-tested tool for identifying potential market reversals and overbought or oversold conditions.
Whether you’re a technical analyst, day trader, or long-term investor, the McClellan Oscillator offers a statistical edge for spotting early signs of market turning points.
How Does It Work?
At its core, the McClellan Oscillator calculates the difference between short-term and long-term moving averages of market breadth (i.e., advancing vs. declining issues). This approach creates an oscillator that fluctuates above and below zero, indicating whether the market is gaining or losing momentum.
Key signals:
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Above +150: Often suggests overbought conditions; potential for a pullback
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Below -150: Indicates oversold territory; possible reversal ahead
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Crosses above or below zero: Signals a shift in market momentum
This dynamic makes the oscillator a crucial tool for timing entries and exits more effectively in both bullish and bearish environments.
Introducing the McClellan Summation Index
A powerful companion to the McClellan Oscillator is the McClellan Summation Index — a cumulative reading of the oscillator that provides a long-term trend perspective.
Combined Usage Strategy:
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Use the oscillator to identify short-term turning points
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Use the summation index to confirm broader market strength or weakness
Together, these tools provide multi-timeframe analysis, allowing traders to assess momentum on both short-term and macro levels.
Breakdown: McClellan Oscillator vs. Summation Index
| Tool | Purpose | Best For |
|---|---|---|
| McClellan Oscillator | Short-term market momentum | Entry/Exit Signals |
| McClellan Summation Index | Long-term trend confirmation | Market Trend Validation |
This dual-tool approach allows for deeper insight and more informed trading decisions across all types of markets — from stocks to forex and even commodities.
The McClellan Toolbox: More Than Just an Oscillator
Tom McClellan’s full suite of trading tools expands beyond the classic oscillator and summation index. Traders gain access to a comprehensive toolkit that includes:
🔸 McClellan Price Oscillator
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Tracks price momentum using moving averages
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Ideal for spotting divergences and trend continuation
🔸 Trend Indicators
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Helps define prevailing market direction
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Assists with trend-following strategies and risk assessment
🔸 Sentiment Indicators
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Measures investor psychology and crowd behavior
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Useful for contrarian signals at market extremes
By integrating these tools, traders can develop a multi-dimensional analysis strategy that improves accuracy, enhances trade timing, and reduces risk.
The McClellan Market Report: Real-Time Market Intelligence
For traders who want ongoing support, Tom McClellan offers the McClellan Market Report — a bi-monthly technical analysis newsletter covering:
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Stock market trends
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Bond and interest rate analysis
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Gold and commodity movement
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Breadth and sentiment indicators
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Actionable market forecasts
The report includes data-driven projections, educational insights, and real trade ideas backed by historical analysis and current market breadth data.
Key Features:
✅ Forecasting models
✅ Breadth signal alerts
✅ Charts & strategy tips
✅ Institutional-grade insights for all trader levels
Why Choose the McClellan Oscillator?
🔹 Decades of Proven Accuracy: In use since 1969, trusted by professionals
🔹 Works Across All Markets: Stocks, indices, ETFs, and even Forex
🔹 Time-Tested Yet Evolving: Constantly updated to adapt to market evolution
🔹 Enhances Any Trading Strategy: Whether you’re a scalper or long-term investor
🔹 Actionable Signals: Helps spot reversals before they become obvious
Real-World Applications
Traders using the McClellan Oscillator report benefits such as:
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Early warning signs of market corrections
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Better timing on entry/exit points
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More confidence in trend reversals
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Improved market sentiment reading
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Enhanced long-term trend forecasting
Combined with the McClellan Market Report and additional indicators, these tools offer a complete market analysis framework.
Conclusion: A Must-Have Tool for Serious Traders
The McClellan Oscillator and its associated tools form one of the most powerful and reliable systems in modern technical analysis. Their strength lies in data breadth, momentum accuracy, and long-term reliability. With continuous innovation by Tom McClellan and a loyal community of traders, this system continues to offer a valuable edge in volatile markets.
Whether you’re trading equities, ETFs, or global currencies, understanding market breadth through tools like the McClellan Oscillator can help you stay ahead of the curve — and the crowd.
