[RUTrading]

Strengthening breadth

Usual caveats apply, my calculations, so there may be errors.

I calculate breadth based on stocks held in my database and I do this for various sectors and indices.  I then produce a table as an overview which gives me a summary score of breadth based on how various breadth parameters are behaving.  For example, whether the advance / decline line is above its moving averages.  I do this on a number of time periods.  For the last few weeks the overall score has been pretty dire.  However, over the last two days things have become more positive.  Of course with the rally of the past week that can be expected and that does mean we might be in a bull trap.  I thought I'd share.

Breadth overall scores from yesterday's data:



Breadth overall scores a week previous:


The NASDAQ100 was one of the earlier movers.  'Buy' is just an indication to myself.  A guide not a command.  So that does not mean 'buy' to you, it is just an indication that breadth seems stronger.  My scorings are based on very short, short, medium and long term indications against the various breadth curves and the overal score is a consensus score I came up with.  These are based on breadth improving to some extent more than abosolute values.  'Buy' means than in general breadth is improving in all time frames.  The detail is rather complex and a little ad-hoc.  But the main takeaway is that breadth this week has improved.

The NASDAQ100 was the earliest mover.

Hi pcabc, Thanks for sharing this, looks very interesting your market gauge. Have you tested what happens during 2008 and did your gauges warn you to get out before this drop this year? 

I have been busy creating one for the South African market (JSE) but still not completey done.