Based on the FTD studies, it is not a surprise to see this FTD turn into a successful rally. It had several strong positives going for it. For one, it occurred in conjunction with a 20-day high. Secondly, it was accompanied by strong breadth. And third, it occurred after the 10th day of the rally (which Investors Business Daily says is a negative but 8 of the 9 FTDs that have come after day 10 have now been successful). There were some mild negatives that this FTD had to overcome – namely the fact that it occurred under the 200ma, and that it occurred after a substantial market decline. For those interested in learning more about FTDs, there is a bevy of information available on the blog under the “IBD Follow Through Day” label.
And for anyone interested in purchasing the Tradestation code to study FTDs in more detail on their own may do so here.