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Key Points

  • Advance/Decline Lines Pullback to Key Levels
  • NYSE New Lows Continue to Move Higher
  • NYSE New Highs Fall Again
  • 200-Day Data Fails to Reverse Higher
  • 20-Day Breadth Data Nears Washout Level

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NYSE Breadth

The NYSE Advance/Decline Line has pulled back to test its rising 50-day moving average as stocks have come under pressure. Equity bulls want to see this indicator make a prompt reversal and see the S&P 500 regaining its 50-day moving average before becoming more bullish.

The five-day moving averages of issues on the NYSE making new 52-week and six-month lows have both continued to move higher over the past week. Should weakness in equities persist, bulls want to see these metrics make a lower high relative to June.

The five-day moving averages of stocks on the NYSE making new six-month, and 52-week highs have continued to move lower this week.

The percentage of NYSE issues trading above their respective 200-day moving averages moved to 21% this week from 26% last week. The S&P 500 was rejected at its own 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 40% from 64% 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 moved to 17% this week from 36% last week. The S&P 500 closed below its 20-day moving average.

S&P 500 Breadth

Breadth metrics for the S&P 500 have weakened this week.

  • Advance/Decline Line: Testing the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 26% from 36% last week.
  • Percent Above Their 50-Day Moving Average: 40% from 78% last week.
  • Percent Above Their 20-Day Moving Average: 5% from 36% last week.

Small Cap Breadth

Breadth metrics for the S&P 600 Small Cap Index have weakened this week.

  • Advance/Decline Line: Testing the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 26% from 37% last week.
  • Percent Above Their 50-Day Moving Average: 40% from 69% last week.
  • Percent Above Their 20-Day Moving Average: 9% from 34% last week.

NASDAQ 100 Breadth

Breadth metrics for the NASDAQ 100 have weakened this week. 

  • Advance/Decline Line: Testing a rising 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 26% from 27% last week.
  • Percent Above Their 50-Day Moving Average: 40% from 72% last week.
  • Percent Above Their 20-Day Moving Average: 9% from 24% last week.

Take-Aways:

Breadth metrics continued to weaken across the major U.S. markets over the past week. Advance/Decline Lines have seen a large pullback to test their rising 50-day moving averages, and new lows on the NYSE are still moving higher. Short-term trend metrics are nearing washed-out levels but making a compelling case for aggressive bullishness in this environment is hard.

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