Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

NYSE: Breadth Remains Negative

Published 11/16/2017, 10:00 AM
Updated 07/09/2023, 06:31 AM

Data Suggests Pause Or Bounce

Opinion: All of the indexes closed lower yesterday with negative internals on the NYSE and NASDAQ. Volumes declined on both exchanges from the prior session. Some of the charts saw further deterioration. However, the data is at levels now suggesting a pause or possible bounce from the recent weakness. Yet unless we see an improvement in breadth and or trend, we remain of the opinion that the various near term trends of the indexes be respected, whether positive, neutral or negative.

  • On the charts, all of the indexes closed lower yesterday with negative internals on lighter volume. Some chart deterioration was seen on the DJI (page 2) and VALUA (page 5) as both closed below their near term support levels while the VALUA also broke its 50 DMA. We now fid the index trends as follows, Positive: COMPQX (page 3) & NDX (page 3), Neutral: SPX (page 2), DJI and MID (page 4), Negative: DJT (page 4), RTY (page 5) and VALUA. As well, the cumulative advance/decline lines for the All Exchange, NYSE and NASDAQ are all negative and below their 50 DMAs. The charts are in need of improvement in order to become more positive in our outlook.

  • The data, on the other hand, is now offering some encouragement after the past several weak market sessions. All of the 1 day McClellan OB/OS Oscillators are oversold as the 21 day levels remain neutral (All Exchange:-70.0/-36.43 NYSE:-83.04/-30.86 NASDAQ:-59.64/-38.49). All of the put/call ratios are bullish as well with the Total and Equity Put/Call Ratios (contrary indicators) finding the crowd long puts at 1.04 and 0.74 respectively as the pros are on the opposite side of the fence and long calls with a 0.6 OEX Put/Call Ratio. The Open Insider Buy/Sell Ratio remains neutral at 47.7.

  • In conclusion, while the data is implying some degree of relief from the recent slide, in our opinion, we need to see some improvement in breadth and trend to move from our current opinion that the individual index trends should be respected for their differing messages.

  • Forward 12 month earnings estimates for the SPX from Bloomberg of $136.79 leave a 5.35 forward earnings yield on a 18.9 forward multiple, a 15 year high.

SPX: 2,547/NA

DJI: 22,879/23,567

COMPQX; 6,557/6,753

NDX: 5,994/NA

DJT: 9,380/9,750

MID: 1,810/1,843

RTY: 1,450/1,489

VALUA: 5,650/5,811

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.