The S&P 500 wrapped a rather volatile week by settling in at the upper end of the 3200-3600 range. One key breadth indicator shows clear similarities to the bull run in early October, and also provides a prescription for bulls looking for validation of further upside.
Breadth equals participation, which means it's a way to measure how the individual stocks that make up a broad index are performing relative to the index itself. For me, my order of operations is Price, then Breadth, then Sentiment.
First, let's establish what the price is doing in terms of defining the trend direction. Second, let's review the breadth characteristics and see how the components of the index are performing and whether there is narrow or broad participation in the trend.
You can read more over at StockCharts.com.
RR#6,
Dave
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