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Swing and Day Trading,
pictured on the left, discusses the chart pattern indicator starting on page 133. It discusses the Nr7 pattern and the CPI equation, too.
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This page shows two views of the chart pattern indicator.
From the FAQ...
Chart Pattern Indicator Analysis
For daily signal updates, see CPI.html which shows the locations of where the signal is announced.
The following are DAILY price charts, updated once a week (after Friday's close, current as of that close). The scaling is approximate for the indicator (meaning it might look like it's at 36, but the
actual value is really 34...it's a drawing issue with the charts I'm using).
The above chart shows all of the signals as of Friday's close (and not updated until after next Friday's close), hiding the indicator line beneath the vertical bars.
Vertical green bars are bullish,
red ones are bearish, and white areas are neutral. The following charts clarify the signals.
The most recent signal was bearish on 08/27/2015.
This chart shows the bullish and bearish signal CHANGES. As with the other charts on this page, it is updated only ONCE each week, after Friday's close.
The S&P 500 Index appears as price bars on the top, and the indicator is the blue line (which looks black)
between the red and green bars near the bottom of the chart.
The last chart, below, shows the indicator by itself.
Signals can change for up to a week. If you do not understand why this happens,
then read about the indicator construction, especially the warnings section.
The chart pattern indicator line is not as important as the signals which it
generates, but I have included a third chart of the indicator itself so you can check for divergence.
Divergence often gives hints as to which way the index moves in the future.
Look for lower/higher peaks in the indicator while the index is making flat or higher/lower peaks. The index will often follow the indicator.