Market Breadth Indicators Are Not Always Bullish At Market Tops!
This Amazing Breadth Indicators Will Tell You Exactly When To Pull The Trigger!
This magnificant market breadth indicator is calculated by dividing the weekly advances and declines by the weekly total issues. If prices move steadily upward (strong uptrend) a broad number of stocks should participate. If not there is a negative divergence between the market and market breadth. This could happen, if only heavy weighted stocks in an index are pushing the market higher but the majority of small weighted stocks are already being sold by investors.
By separating the advancing from declining issues, investors can get an additional insight about the direction of the market. Divergences between the market and advancing issues should be monitored closely as a trend reversal could be ahead!
Bullish: Advancing issues above declining issues
Bearish: Advancing issues below declining issues
Watch out for divergences between the market and advancing issues
Why The Crowd Has To Lose All The Time!
The markets are an ever and everything discounting mechanism and the product of the behavior of all their participants and, of course, not everybody can win. In order for every market to function, the majority of the participants have to lose. This majority is usually the uninformed and ignorant crowd, who rather relies on hot tips or even sheer luck like a gambler, instead of doing some homework and spending an extra buck for valuable and useful information.
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