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High RS Diffusion Index

The chart below measures the percentage of high relative strength stocks that are trading above their 50-day moving average (universe of mid and large cap stocks.)  As of 7/6/10.

The 10-day moving average of this indicator is 22% and the one-day reading is 15%.  This indicator has been bouncing around in oversold levels for two months now.  Dips in this indicator have often provided good opportunities to add to relative strength strategies.