The Grinch Roasted Santa On An Oversold Fire – The Market Breadth

Stock Market Commentary According to Investopedia, the Santa Claus rally “describes a sustained increase in the stock market that occurs in the last week of December through the first two trading days in January.” With the legendary rally still a week away, the S&P 500 (SPY) finds itself priced exactly where it was at the end … Read more

Small Cap Breakout, Pfizer COVID Anti-Viral Boost Bullish Market Breadth

Stock Market Commentary The first trading week of November was action-packed. At the start of the week I looked ahead to monetary policy from the Federal Reserve and the October jobs report as key catalysts. While those events were indeed important, the stock market was treated to an overlay of at least two other important … Read more

Above the 50 Now Defines Key Measure of Stock Market Breadth

Above the 50, AT50 (MMFI) and Above the 40, AT40 (T2108) are highly correlated.

Above the 50 (AT50) Replaces Above the 40 (AT40) I had a long and rewarding journey using AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), as my key measure of market breadth. Over the past several years Worden and its TC2000 platform gradually reduced support for the FreeStockCharts platform … Read more

Warnings from Early Divergences in the Oversold Bounce – Above the 40 (July 23, 2021)

Stock Market Commentary The oversold bounce last week exceeded my expectations. I did not expect the week to end with the S&P 500 and the NASDAQ hitting fresh all-time highs. Both indices seemed to offer limited upside for trading oversold conditions.The oversold bounce also disappointed me. I looked to beaten up stocks as the source … Read more

Follow-Through Trades: A Classic Bounce from Oversold Conditions

The Follow-Through: Bounce Stock market traders delivered a classic bounce from oversold trading conditions. The S&P 500 (SPY) confirmed a picture-perfect test of support at its 50-day moving average (DMA). The NASDAQ (COMPQX) pulled off a picture-perfect toe tap of its lower Bollinger Band (BB). The iShares Trust Russell 2000 Index ETF (IWM) confirmed a … Read more

Declining Market Breadth Resolved Into An Oversold Trading Period – Above the 40 (July 19, 2021)

Stock Market Commentary Unlike the months long process of declining market breadth, the resolution into an oversold trading period came swift, fast, and in a hurry. I thought my wait for an oversold trading period would last more days and weeks. Instead, a further plunge in market breadth combined with other important price signals to … Read more

How Declining Market Breadth Delivered A Beating On Stocks – Above the 40 (July 16, 2021)

Stock Market Commentary The stock chickens have come to roost on declining market breadth. The stock market indices still generally appear fine, but an ever growing swath of individual stocks have fallen further and further behind. Last week in particular, sellers delivered an extended beating on individual stocks. The signs of waning confidence in the … Read more

Waiting on Oversold – Above the 40 (July 15, 2021)

A very simple message from Above the 40 for today: gravity continues to tug the stock market toward oversold conditions. While the melt-up on the S&P 500 (SPY) has transitioned to a “levitation” and the NASDAQ (COMPQX) stumbled into a test of support at its 20-day moving average (DMA), the percentage of stocks trading above … Read more

Back to the Regularly Scheduled Stock Market Melt-Up – Above the 40 (July 10, 2021)

Stock Market Commentary The stock market melt-up took a one day break. The signs of trouble were ever more clear ahead of the break. Something was wrong with the picture in the stock market. Yet, sellers could barely follow through. The S&P 500 stumbled with a gap down, but buyers stepped right back in at … Read more

Something Is Wrong With This Stock Market Picture – Above the 40 (July 7, 2021)

Stock Market Commentary I feel like a broken record pointing out the shrinking participation accompanying the stock market’s persistent rally. However, the downtrend in market breadth becomes more and more notable over time. More signals converged this week of eroding underlying conditions despite the all-time highs on the S&P 500 and the NASDAQ. Even the … Read more