This is something i was looking at a while ago but didn't ever think too much of it. I started looking at it again last night, and think it might be worth a bit more time. All i have is the XAO plotted against the buy signals my system produces and the 8 day average of those signals.
I don't know if i've been staring at it for too long, but it looks like the periods of extreme buy signals coincide with the XAO peaks with pretty high accuracy.
The system is a long only system, so I'd expect more signals in a rising market, but it's the days or small groups of days with extreme signals compared to the days either side that i'm interested in. They occur just before the market turns.
Does anyone think it's got any merit? It's not something i've worked on, just something i've observed. I've circled the main areas of interest, although many smaller XAO peaks also line up with increased buy signals.