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Key Points

  • Short-Term Breadth Data Remains Constructive
  • 50-Day Metrics Continue to Improve
  • NYSE New Lows Move Lower Again
  • NYSE New Highs See a Small Uptick
  • A Higher High for the NASDAQ 100 Advance/Decline Line

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NYSE Breadth

The NYSE Advance/Decline Line has improved further this week while holding above the 50-day moving average. The moving average has also begun to rise slightly. At the same time, the S&P 500 is holding above its moving average, which has shifted from declining to flat.

The five-day moving averages of issues on the NYSE making new 52-week and six-month lows have moved lower again this week. Both metrics are now below 2% and have been trending to the downside since their June peaks.

While small, there was an uptick in the five-day moving averages of stocks on the NYSE, making new six-month and 52-week highs. Given the carnage in the market this year, these metrics will take some time to materially improve; however, this is a step in the right direction.

The percentage of NYSE issues trading above their respective 200-day moving averages moved to 19% this week from 15% last week. The S&P 500 remains below its 200-day moving average, which is moving lower.

The percentage of NYSE issues trading above their respective 50-day moving averages rose to 59% from 49% last week. The S&P 500 has moved above its 50-day moving average.

The percentage of issues on the NYSE trading above their respective 20-day moving averages rose to 79% this week from 73% last week. The S&P 500 is above its rising 20-day moving average.

S&P 500 Breadth

Breadth metrics for the S&P 500 improved over the past week.

  • Advance/Decline Line: Breaks above the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 25% from 18% last week.
  • Percent Above Their 50-Day Moving Average: 67% from 49% last week.
  • Percent Above Their 20-Day Moving Average: 85% from 76% last week.

Small Cap Breadth

Breadth metrics for the S&P 600 Small Cap Index improved over the past week.

  • Advance/Decline Line: Still above the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 31% from 4% last week.
  • Percent Above Their 50-Day Moving Average: 66% from 61% last week.
  • Percent Above Their 20-Day Moving Average: 85% from 86% last week.

NASDAQ 100 Breadth

Breadth metrics for the NASDAQ 100 have improved this week. 

  • Advance/Decline Line: Above a rising 50-day moving average, made a higher high last week.
  • Percent Above Their 200-Day Moving Average: 25% from 16% last week.
  • Percent Above Their 50-Day Moving Average: 78% from 76% last week.
  • Percent Above Their 20-Day Moving Average: 81% from 80% last week.

Take-Aways:

Once again, we can say that the breadth data has improved over the past week. Yesterday saw the S&P 500 close above the important 4,000 level, opening the door to a move toward the 200-day moving average. These dynamics, in combination with the signs of rising risk appetite that we highlighted on Friday, create an environment that has become slightly more bullish in the near term.

*Due to travel plans, we will publish on a modified schedule next week.

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Disclosure: This information is prepared for general information only and should not be considered as individual investment advice nor as a solicitation to buy or offer to sell any securities. This material does not constitute any representation as to the suitability or appropriateness of any investment advisory program or security. Please visit our FULL DISCLOSURE page.