Tuesday, September 21, 2010

Strong Breadth on the Breakout

It is very rare to see a fresh breakout occur on such positive breadth as we saw Monday. In the past it has often led to a successful breakout. Below is a study that examines this.

A positive impact can be seen right away. And when looking out 4-5 weeks the risk/reward remains very favorable. The market is certainly very overbought and could pull back at any time. But this is one study suggesting there's a good chance the current momentum begets more buying.


Steveo said...

Boatload O Charts for your bearish delight....
During the ramp, every time I posted a Boatload O Bear, the market would rally.

This shall be the litmus test. Please comment.


Daniel said...

Thanks Rob as always for these fresh and interesting slants on this confusing and choppy market action.

Thanks Steve for such a dumb comment. It indeed is a litmus test; any comment dumber than this would have to show up ultrapink, that is extra-dumb. Any comment as dumb would be neutral; any comment smarter would actually be worth reading.