We are clearly at a extreme bullish breadth levels. Such high levels lead to corrections. Many such corrections can be sudden and vicious. But a overbought market can remain overbought fr long. In a long running bull market such overbought levels correct slowly and then the move resumes. At this stage we do not know how this move will play out. But you should be in a pullback/correction anticipation mood. Protecting profits made so far should be one of the prime objective. The market did not get rattled by China drop, which is a good sign.
- A series of 300 plus negative 4% days will be negative for market.
- The #of stocks up 25% in a quarter going below 200 would be bearish
- So far we have not seen these things.
- So breadth is showing you a good bull market currently.
- Which is getting reflected in our trading.
| Market Monitor Market monitor is market breadth based market timing tool | Current Readings Market in a rally mode. Earnings season currently on | ||
| Type | Indicator | Value | Comments |
| Daily | # of stocks up >4% on high volume | 135 | No heavy selling so far. But I have sold most vulnerable positions. |
| Daily | # of stocks down>4% on high volume | 217 | |
| Primary | # of stocks up >25% in a quarter | 2049 | |
| Primary | # of stocks down>25% in a quarter | 355 | Approaching 200 indicates extreme bullishness |
| Secondary | # of stocks up> 50% in a month | 9 | But this one is not in extreme zone. |
| Secondary | # of stocks down>50% in a month | 3 | |
| Secondary | # of stocks up>25% in a month | 191 | |
| Secondary | # of stocks down>25% in a month | 14 | |
| Primary fast | # of stocks up>13% in 34 days | 2574 | |
| Primary fast | # of stocks down>13% in 34 days | 591 | |
| MMA+ | % of stocks in confirmed uptrend | 70 | This is in bearish territory. |
| MMA- | % of stocks in confirmed downtrend | 14 | |
| 10 day cumulative breadth ratio | #of stocks up> 4% in last 10 days/ #of stocks down>4% in last 10 days | 2.67 | |
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