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Key Points

  • Short-Term Breadth Data Spikes Higher
  • 50-Day Metrics Begin to Improve
  • NYSE New Lows Trend to the Downside
  • Advance/Decline Lines Begin to Move Higher
  • NASDAQ 100 Breadth Stands Out

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NYSE Breadth

The NYSE Advance/Decline Line has moved above the 50-day moving average after making a slightly higher low with price last week. We also note that the S&P 500 closed above its 50-day moving average. These early signs of improvement are welcome and now await follow-through.

The five-day moving averages of issues on the NYSE making new 52-week and six-month lows have continued to move lower this week, and we note that the moving averages made lower highs in June relative to May.

There is still nothing new to highlight as it relates to the five-day moving averages of stocks on the NYSE making new six-month and 52-week highs. Both metrics are below 1%.

The percentage of NYSE issues trading above their respective 200-day moving averages moved to 15% this week from 12% last week. The S&P 500 remains below its 200-day moving average, which is moving lower. The damage that has been done to long-term trends will take time to repair.

The percentage of NYSE issues trading above their respective 50-day moving averages rose to 48% from 28% last week. The index 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 73% this week from 47% last week. The S&P 500 has moved above its 20-day moving average.

S&P 500 Breadth

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

  • Advance/Decline Line: Testing the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 18% from 17% last week.
  • Percent Above Their 50-Day Moving Average: 49% from 19% last week.
  • Percent Above Their 20-Day Moving Average: 76% from 45% last week.

Small Cap Breadth

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

  • Advance/Decline Line: Crosses above the 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 24% from 14% last week.
  • Percent Above Their 50-Day Moving Average: 61% from 27% last week.
  • Percent Above Their 20-Day Moving Average: 86% from 44% last week.

NASDAQ 100 Breadth

Breadth metrics for the NASDAQ 100 have turned lower this week. 

  • Advance/Decline Line: Above a rising 50-day moving average.
  • Percent Above Their 200-Day Moving Average: 16% from 14% last week.
  • Percent Above Their 50-Day Moving Average: 76% from 33% last week.
  • Percent Above Their 20-Day Moving Average: 80% from 80% last week.

Take-Aways:

Breadth metrics have improved on the week, especially for the short-term data. However, these short-term improvements are beginning to show up in the intermediate-term data as well. While 2022 has been defined by a breadth of “head fakes,” we are not going to ignore them; a move above 4,000 for the S&P 500 likely sets the stage for testing of the 200-day moving average.

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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.