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Market Breadth Sentiment

Summary

Weekly update of the market Breadth sentiment on the major indexes (S&P 500, NYSE Composite, DJI, Nasdaq 100 and Russell 200)

Short-term outlook for the coming week.

long-term market Breadth sentiment.

A week ago we mentioned (at https://seekingalpha.com/p/2zi93) following:

"...The shorter-term Breadth numbers are bullish and the odds are on the side of the Bulls for the coming week..."

The first three days of this week were positive, yet, the volatile decline on 7/27/2017 erased all weekly gain on the S&P 500 and Nasdaq 100 indexes. The DJI index, on the other hand had a bullish week. The week ended with the NASDAQ 100 loosing 0.55%; the S&P 500 showing a plus of 0.06%, and the Dow closing up 1.4%.

By the end of this week we have following long-term Breadth numbers:

72% of the S&P 500 index listed stocks are bullish - the same as a week ago;
73% of the DJI index listed stocks are bullish - the same as a week ago;
78% of the NASDAQ 100 index listed stocks are bullish - 3% more than a week ago;
62% of the Russell 2000 index listed stocks are bullish - 0.5% less than a week ago;
62% of the NYSE stocks index listed are bullish - the same as a week ago.
Source: https://www.marketvolume.com/advance_decline/highlowrangechartsimple.asp

The numbers above remain to indicate the Bullish long-term Breadth sentiment. Despite the negative trading on the Nasdaq 100 index, we have increase in the number of Bullish stocks on this index. The other market indexes show little to no change in the number of Bullish stocks.

At the same time, last two days of the week brought some weakness into the short-term Breadth sentiment on the S&P 500:

357 of the S&P 500 stocks are traded above their 200-day SMAs - 14 stocks less than a week ago - Bullish sentiment,
343 of the S&P 500 stocks are traded above their 120-day SMAs - 9 stocks less than a week ago - Bullish sentiment,
313 of the S&P 500 stocks are traded above their 50-day SMAs - 45 stocks less than a week ago - Bullish sentiment,
322 of the S&P 500 stocks are traded above their 20-day SMAs - 35 stocks less than a week ago - Bullish sentiment.
Source: https://www.marketvolume.com/stockscreener/sp500scan.asp

The S&P 500 shorter-term Breadth sentiment is Bullish on all time-frames - more than 50% of the S&P 500 listed stocks are traded above their Moving Averages. However, the fact that the number of the Bullish stocks is dropping reveals that this Bullish sentiment is weak. Should we experience further decline in the number of the bullish stocks, we may see the S&P 500 index diving into a correction. While the volatility on the S&P 500 index is low and we should not fear anything dramatic, still, we could be facing a few unpleasant bearish days.

Since the Nasdaq 100 had a strong bearish day on 7/27/2017, also, it is worth checking short-term Breadth sentiment on this index:

80 of the S&P 500 stocks are traded above their 200-day SMAs - 14 stocks less than a week ago - Bullish sentiment,
71 of the S&P 500 stocks are traded above their 120-day SMAs - 9 stocks less than a week ago - Bullish sentiment,
63 of the S&P 500 stocks are traded above their 50-day SMAs - 45 stocks less than a week ago - Bullish sentiment,
72 of the S&P 500 stocks are traded above their 20-day SMAs - 35 stocks less than a week ago - Bullish sentiment.
Source: https://www.marketvolume.com/stockscreener/nasdaq100scan.asp

The same as on the S&P 500 index, we have the dominance of the Bullish stocks on all Nasdaq 100 time-frames. The bearish trading on 7/27/2017 did not shaken the confidence of the Bulls - they are still in charge. In order to push the market down, it would require, more days like the the one on 7/27/2017. At this point of time, we should not be scared by the negative and volatile trading on that day, but consider it as a single occurrence only.

In summary, the Breadth sentiment favors side-way and bullish trading for the coming week

Market Breadth charts:
source: https://www.marketvolume.com/stocks/analysis.asp





Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.