Best Thread Market Breadth

[isatrader]

US Industry Sectors Breadth

I've updated the US Industry Sectors Breadth charts. I've refined the signals a bit to be a break above or below a swing high or low instead of the 30 week MA as that was too slow for the sectors. So all of the nine sectors moved lower this week with Consumer Discretionary, Consumer Staples, Basic Materials and Industrials going to a sell signals by breaking below their swing lows.

Below is the data table for the Percent of Stocks Above 150 Day Moving Average in each sector which I've ordered by the highest to the lowest percentage in each sector. Utilities was the weakest sector of the week and dropped a massive 24.01% followed by Financials which dropped 10.45%. Although the lowest sector overall, Technology was actually this weeks strongest by relative strength as only another 2.70% of stocks fell below their 150 day moving averages.

So you'll see on the table and visual diagram that the picture overall is now very negative and there's still the possibility of further downside as none of the sectors have dropped below the 30% level yet.

 

[isatrader]

Attached is the updated market breadth charts for the NYSE.

The head coach that is the long term NYSE Bullish Percent chart finally reversed to a column of Os on Friday and moved to Bear Alert status. This highlights the increased risk in the market that we've been seeing on the short and medium term measures which all remain on Bearish statuses.

The line chart of the NYSE Percent of Stocks Above their 150 Day Moving Averages also gave a sell signal this week by moving below it's swing low and that formed below the 50 day MA and crossing the 30 week WMA.

The short term NYSE Percent of Stocks Above their 50 Day Moving Averages chart continued lower and is getting closer to the oversold zone and it's price objective at 30%. So we may be close to a short term low, but the trend is bearish now and so it would be wise to be nimble on any rallies until there's some stabilisation in the short and medium term breadth charts.

 

[isatrader]

Attached is the secondary breadth charts. The NYSE Advance Decline line broke below it 50 day (10 week) MA this week to close just below the low of the recent range since September.

The New High New Lows showed a notable pick up in new lows which at times intraday crossed above the new highs, but closed each day slightly positive. So it on the brink here.

The NYSE Advance Decline Line Volume broke below it's swing low that had formed below the 50 day MA which I consider a sell signal.

Also attached are the new ratio charts of the S&P 500 divided by the Bullish Percent and Percentage of Stocks above their 50, 150 and 200 day MAs. All of which highlight the move into bearish territory.

So the weight of evidence in the secondary breadth charts is on the bearish side currently. Attached are the charts.

 

[isatrader]

Momentum Index (MI)

The Advance Decline Momentum Index (MI) broke below it's one year trend line this week.

 

[Dentalfloss]

My bias, which has been down for almost two months, remains down. The market can turn any time it wants, but in my opinion, until we either get ridiculously good news or a total washout from the breadth indicators, I don’t think a bounce will last long or go far.

Here’s one indicator I’m watching. It’s the NYSE 52-week New Lows. I want to see it spike up before I’ll believe a real bottom has been put in place

as said by jason levitt today

 

[isatrader]

New Highs New Lows goes negative

My bias, which has been down for almost two months, remains down. The market can turn any time it wants, but in my opinion, until we either get ridiculously good news or a total washout from the breadth indicators, I don’t think a bounce will last long or go far.

Here’s one indicator I’m watching. It’s the NYSE 52-week New Lows. I want to see it spike up before I’ll believe a real bottom has been put in place
as said by jason levitt today

Thanks for posting the New Lows chart dentist. It is actually the same chart that I post every weekend, but I have $NYLOW as an red overlay on top of the $NYHGH (New Highs) chart. See post #123 that I put up at the weekend.

Today the New Lows crossed the New Highs for the first time since May, which is another bearish sign for the market. Attached is the same chart, but viewed in two different ways. Firstly the normal way I present the data with the New Lows (red data) overlaid on the New Highs (grey data), and secondly the New Highs minus the New Lows chart which is cleaner and shows negative moves when it drops below zero like it did today.

You'll note that the New Lows tends to get much worse than it is currently, with double the amount of new lows during the May bear move, and five times as many at the beginning of the August 2011 bear move. Which then had three additional large spikes before the New Highs crossed to the upside again a few months later, so this may only be the beginning of a more serious move.

 

[isatrader]

Long term Breadth Status Change

The long term NYSE Percent of Stocks Above their 200 Day Moving Averages chart gave a P&F sell signal today, as a further 10.61% more stocks in the NYSE have dropped back below their 200 day moving averages since last Friday. This now moves it from Bear Alert to Bear Confirmed status and means that now all of the leading breadth indicators* are on Bear Confirmed status.

*Since their introduction, the moving average based breadth indicators have become the leading indicators, and the role of the bullish % has become one of a confirming indicator for medium term trends. Quote from the Investors Intelligence website.

Today's price action also dropped the short term NYSE Percent of Stocks Above their 50 Day Moving Averages chart into the oversold zone for the first time since Mays correction. However, it can stay oversold for a long time, especially as the medium and long term measures have plenty of downside room to spare and are very negative currently. So I won't be considering trading on the long side of the market until it at least stabilises and breaks out back above the 30% level, but the trends are now firmly negative and so I'll be looking to sell any short term rally's back to resistance zones.

Below is the data table and the P&F breadth charts and the line chart versions for a change.

 

[Dentalfloss]

Yesterday we got a sharp plunge from the AD line.
We also got a spike from the new lows.
The trend is down, but we’re getting close enough to a tradable bottom to be a little more careful on the shorts side. The easy money has been made, so don’t get carried away here. The biggest rallies come within downtrends. More after the open.
I really was hoping for a modest gap down today to go in long. Well wait for your pitch. I will be looking for a 15 point drop in the NASDAQ from yesterdays close in the morning to go long. Otherwise time to go back and sit in the dugout.
from jason levitt

 

[Dentalfloss]

here are the charts..courtesy of Jason Levit

 

[isatrader]

The major breadth charts only made small changes from my update on Wednesday night and moved a little bit lower before reversing modestly on Friday. It wasn't enough of a reversal to change any of the charts into a column of Xs, but it is worth noting that the short term NYSE Percent of Stocks Above their 50 Day Moving Averages chart is well into oversold territory below 30%, with only 22.12% of stocks in the NYSE currently above their 50 day moving average. So the risk of a short covering rally is significantly increased. However, the medium and long term trends are on Bear Confirmed, so the weight of evidence remains bearish currently, but increasingly short term oversold.

I read a good analyst report this week on Dorsey's site about the NYSE Bullish Percent reversal over a week ago, that gives a good analogy imo of how you should interpret the Bullish Percent's reversal to a column of Os. See the quote below:

"The bullish percent concept is, at its core, an indicator of participation and is best employed as a risk barometer. Given that that major market indices have violated their positive trend lines, it does suggest that a more defensive approach to equity exposure is heeded. It is worth a reminder, however, that reversals from these levels does not mean a race to the downside has begun. Like the literal traffic light, a "red light" is not caused by a catastrophic accident, but is rather there to greatly reduce the probability of such an event! You may in fact know someone who has, at one point or another, disregarded a red light for one reason or another. They may have escaped unnoticed, in some states they may have simply received something in the mail from the Department of Motor Vehicles suggesting a contribution of some kind, or they may have experienced a far worse outcome. The point is that a red light suggests that you continue forward in the manner in which you approached the signal, with significantly elevated risk to you and those around you."
Quote from the Dorsey, Wright & Associates analyst report - 13th November

Ok, below is the current data table and the NYSE Bullish Percent chart and Moving Average breadth charts. I'll post the US Sector breadth charts later or tomorrow as I still need to calculate the percentages for each and input them into my chart software.

 

[isatrader]

Attached is the secondary breadth charts of the NYSE Advance Decline line, The New High New Lows and the NYSE Advance Decline Line Volume.

New Lows crossed above the New Highs this week and closed the week above the key 100 level after reaching the same levels on Thursday that where hit in the middle of May.

 

[isatrader]

Volatility Breadth Charts

Attached is my volatility breadth charts that show the ratio between the NYSE price and the major NYSE breadth charts. Moves above the 50 day MA show bearish periods and moves below the 50 day MA show bullish periods.

 

[isatrader]

Re: US Industry Sectors Breadth

I've calculated the percentages and updated the US Industry Sectors Breadth charts so I can see the internal movements in the NYSE Major Sectors.

All nine sectors stay on sell signals for another weak with further declines across the board this week. Basic Materials was the biggest faller with a further 10.78% of stocks in the sector falling below their 150 day moving averages. Financials was the second largest faller with a further 9.03% falling below their 150 day moving averages.

Energy moved below it's 30% level into the beginning of the oversold zone and Technology is pretty close as well. But as you can see on the charts, the sectors tend to get a lot more oversold before the end of a major bearish move than the overall NYSE moving average breadth chart with moves down to as low as the 10% level in some, and so could fall much further yet. However, the most oversold sectors could also be the early beneficiaries if we see a bear correction short covering rally, so they could be a good place to focus on for more aggressive counter trend traders imo. It will be interesting to see how it plays out and how useful the individual sectors information is over time, as it's very early days of me plotting it each week.

Below is the data table for the Percent of Stocks Above 150 Day Moving Average in each sector which I've ordered by relative strength, with the highest to the lowest percentage in each sector. Also attached is the visual diagram of the 9 sectors and the overall NYSE Percentage of Stocks above their 150 day Moving Averages, which I'm really liking, as if you compare back through the weeks you can see the individual sector changes really clearly and the shift of the overall market into it's current bearish phase.

 

[isatrader]

Momentum Index (MI)

Attached are the momentum index charts for both the Advance Decline Momentum Index and the New High New Low Momentum Index. I've also added the short term cumulative Advance Decline lines for 10 days and 30 days to the chart. Both momentum indexes are now below their one year trend lines.

 

[Dentalfloss]

we got the pump today .as we said on friday
now....where is the dump ??

 

[isatrader]

we got the pump today .as we said on friday
now....where is the dump ??

There's been some strong intra-day moves on the moving average breadth charts which you can see on the Barchart.com Market Momentum page. It doesn't cover as many stocks as the Stockcharts versions, and so the percentage numbers are different, but the movements are basically the same and it has the addition information of the Open, High, Low and Close data instead of just the Close data. So I find it useful to look at during the day to see if the breadth is doing the same as the price action is. And so currently this shows that the 50 day has risen +5.75% so far today and the 150 day has risen +5.34%, and so they are both likely move to a column of Xs tonight on the Stockcharts P&F closing price charts and become Bear Correction status. But I'll confirm this later as the charts don't update until around 11pm UK time.

So you might have to wait a bit longer for the dump, as the intra-day breadth is confirming the move so far...

 

[bearsworth]

Re: Momentum Index (MI)

Attached are the momentum index charts for both the Advance Decline Momentum Index and the New High New Low Momentum Index. I've also added the short term cumulative Advance Decline lines for 10 days and 30 days to the chart. Both momentum indexes are now below their one year trend lines.

Good sign we are still above the zero for the MI. Hopefully this is only a temporary bear market.

 

[isatrader]

Moving Average Breadth Changes

There was changes in the short, medium and long term moving average breadth charts today will all three reversing back to a column of Xs and putting in a short term low. The moves were strong, with over 10% of stocks recovering back above their 50 day moving averages, which took the short term gauge back out of the oversold zone above the 30% level. So the short term status moves to Bull Alert for the time being.

The more important medium and long term charts also reversed to Xs and are now on Bear Correction status. Below are the updated table and charts

 

[Dentalfloss]

There isn’t much influential news out, and with today being a half day, odds favor the situation at today’s close being very much the same as it was at Tuesday’s close, namely that several breadth indicators hit extreme levels and told us take profits on shorts, and so far this week has been the biggest up week in a couple months.

But the first move is the easy move because there’s pent up demand both in terms of buying interest and needed short covering. But after the first surge takes place, we need to see prices continue up on strong volume to offer evidence bigger players are stepping in. This isn’t going to happen today, but starting next week, it will be mandatory. Otherwise this bounce will ultimately prove to be a dead cat bounce within a downtrend. The market has some proving to do.

Here’s the 15-min SPX chart. I’d prefer the index to sit tight today and then attempt to break out next week.
from Jaso Levitt today

 

[Dentalfloss]

from Jason Leavitt
Two weeks ago I covered some indicators that helped us nail the bottom; today I’m presenting a couple indicators which are telling us a local top is likely being put in place right now
link to the video
Leavitt Brothers: Blog