A better indicator to sniff out trend changes is the ratio between new highs and new lows. The ratio bottoms when the market bottoms (late November, beginning February) and crests when the market does (mid-January, now?).

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A stock market making new highs should have more individual stocks making new highs than new lows. If you measure that the difference between new highs and new lows accumulated over time you get the following picture: As you can see, the strong market correction in February shows up merely in a sideways movement of…

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Investors usually look at the advance-decline line to gauge if a trend is still healthy. In theory, an up-trend is healthy if advances by an index are supported by most stocks (opposed to being driven by only few advancing stocks while the majority is already in decline). Every day you add the number of advancing…

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First we take a look at the S&P 500 index. New 52 week highs (bullish). Higher highs and higher lows (bullish). However, higher prices should be accompanied by higher volume. This is not the case. Actually, days with higher volume have recently been down (red volume bar) days. This is a warning sign.

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