Today we will share a chart that we post on Section 4 of our Standard Site every morning. This seemingly simple chart answers a lot of important questions.
For instance, questions like these ...
1. Since September 9th, how many days did the stock market have more positive trending stocks than negative trending stocks?
The answer from the chart is: Only 2 days, which means that the Market Bias has been negative for most of September. (Note: The horizontal line at 250 is the Neutral line. Whichever indicator is above the line determines the short term dominant market condition.)
2. At the close yesterday, were there more positive trending stocks or negative trending stocks?
The answer from today's chart is: There were more Negative trending stocks than Positive trending stocks. In fact, when we looked at the unweighted stock data for the S&P 500, there were 142 stocks with Positive Strength and 358 stocks with Negative Strength. That is a ratio of 2.52 negative strength stocks for every positive strength stock.
The only good news was that there was a down tick on the number of Negative stocks yesterday.
IF ... we can get another down tick today ... one that is lower than Tuesday's 310 level, then that would show a new down trend on Negative Stocks that could offer some hope for next week. (This chart is updated every morning before the open.