We don't show this chart very often, but one on the things that our paid subscribers see every morning before the market opens is our Ratio of the % of Stocks with Upward Strength vs. the % with Downward Weakness.
Every night, we run a strength measuring analysis of all the stocks on all the indexes ... on over 8,000 stocks. This is a measurement of the broad market for every stock with a value over $2.00.
Why is this important?
Very simply ... a market that is rallying up has more stocks trending up than down, so its ratio is a positive number. The higher the ratio number is, the stronger the rally gets. The opposite is also true ... when the Ratio is negative, then there are more stocks in a down trend compared to those in an up trend, and therefore the market trends down.
Is the Ratio positive or negative now?
The ratio is negative, and in fact, it went negative on February 27th. when the market saw its big down day.
The ratio trending during the last 12 days has been: -1.61, -1.82, -2.36, -2.81, -2.26, -2.12, -1.70, -1.53, -1.29, 2.33, 2.15 and -1.75 to 1.
Why is this personally important to you?
Because a sustainable rally resumption by definition, cannot occur until at least one half of the stocks are trending up.
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