Wednesday Market Momentum Breadth Volume
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There isn't much doubt at this point that distribution is taking place behind the scenes in the stock market. The chart below shows advance /declines for all the major exchanges have now broken below the lows of last March.
Looking at advance /declines from a longer term perspective shows that the price highs have been well supported by the breadth of the market. But now it looks like breadth has peaked along with prices and they are headed lower in a long awaited correction.
The bullish percents of the two major exchanges have ticked lower the last four sesssions and show a series of lower highs and lower lows. The bullish percents have held up for quite a while, but now appear to be weakening with the market.
The Summation Index is nearing the zero-line cross-under that signals a price correction is underway.
The ratio of new lows over new highs is more evidence of a market undergoing behind the scenes distribution.
Just out of curiousity, I grabbed a book that I just started reading the other day called "The Complete Guide to Market Breadth Indicators: How to Analyze and Evaluate Market Direction and Strength" by Gregory L. Morris. While it is early going, this 2006 book looks like at a minimum the definitive reference book on the subject of market breadth indicators. Are you familiar with it? Any thoughts?
Cheers,
-Bill (Comment this)