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Take-Aways

Breadth metrics were weaker over the past week of trading. All Advance/Decline Lines are below their respective 50-day moving averages, and new lows on the NYSE are beginning to reverse their downtrend from June. Twenty-day data is nearing washed-out levels while intermediate and long-term metrics worsen. Should the June lows in the S&P 500 be tested, we want to see breadth metrics at stronger levels than what was seen at that time to indicate less selling intensity.

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NYSE Breadth

The NYSE Advance/Decline Line has fallen further below its 50-day moving average over the past week and is now threatening a retest of the summer lows. The S&P 500 finds itself in a similar position. Should the A/D Line break to new lows for the cycle, it would increase the odds that the S&P 500 will do the same.

The five-day moving averages of issues on the NYSE making new 52-week and six-month lows have reversed higher. This build-up in new lows is not a welcome development for equity bulls who want to see these metrics at depressed levels to have the conviction that rallies will have staying power.

The five-day moving averages of stocks on the NYSE making new six-month and 52-week highs have moved lower once again. Both metrics are back below 1%, and the downtrend since the November 2021 peak remains in place.

The percentage of NYSE issues trading above their respective 200-day moving averages moved to 17% this week, down from 22%. The S&P 500 remains below its 200-day moving average. The bears still control the long-term trend.

The percentage of NYSE issues trading above their respective 50-day moving averages moved to 19% from 35% last week. The S&P 500 is below its 50-day moving average.

The percentage of issues on the NYSE trading above their respective 20-day moving averages fell to 14% this week from 28% last week. The S&P 500 closed below its 20-day moving average. Readings below 10% have generally signaled short-term washout conditions this year.

S&P 500 Breadth

Breadth metrics for the S&P 500 were weaker on the week.

  • Advance/Decline Line: Below the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 19% from 29% last week.
  • Percent Above Their 50-Day Moving Average: 14% from 35% last week.
  • Percent Above Their 20-Day Moving Average: 6% from 22% last week.

Small Cap Breadth

Breadth metrics for the S&P 600 Small Cap Index were weaker this week.

  • Advance/Decline Line: Below the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 19% from 24% last week.
  • Percent Above Their 50-Day Moving Average: 14% from 24% last week.
  • Percent Above Their 20-Day Moving Average: 13% from 15% last week.

NASDAQ 100 Breadth

Breadth metrics for the NASDAQ 100 have weakened this week. 

  • Advance/Decline Line: Below the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 10% from 21% last week.
  • Percent Above Their 50-Day Moving Average: 11% from 23% last week.
  • Percent Above Their 20-Day Moving Average: 6% from 18% last week.

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