Assessing Market Action With Indicators And History
Friday, April 24, 2009
Weak Nasdaq Breadth On An Up Day
One of the most notable aspects of Thursday’s trading was the poor breadth in the Nasdaq, as only about 38% of issues closed higher. This is extremely rare on a day where the market rises. I looked at the possible implications a number of different ways in last night’s Subscriber Letter. The consensus whether looking at the effect on the Nasdaq or the S&P was bearish. Below is one study that looks at other times the Nasdaq Up Issues % (Advancers / (Advancers + Decliners)) came in lower than 40% while the S&P closed higher.
(click to enlarge)
Bearish results across the board over the following 2 weeks or so.
In this blog I will be examining market action and quantifying my findings. Using sentiment, breadth, price and volume indicators - both standard and customized - I will try and uncover short-term edges which could be taken advantage of by market participants. I will frequently add opinion to these studies and may sometimes post opinions without quantifiable research behind them.
All content on this site is provided for informational purposes only. It is NOT a recommendation or advice to buy or sell any securities. I may hold positions for myself or clients in the securities or industries mentioned here. There is a very high degree of risk involved in trading securities. Your use of any information on this site is entirely at your own risk.
I have traded professionally since 2001. From January 2003 through February 2007 my bi-weekly column "Rob Hanna's Putting It All Together" appeared on TradingMarkets.com. I have been conducting quantitative research and designing trading systems - mostly focused on short-term edges since 2004.