A detailed description of the EQ indicator can be found here.
The EQ Indicator for January dripped to 1.43 from 1.49 in December, indicating that current price levels are well-supported by financial capital flowing into the economy, despite ongoing fears to the contrary.
The charts shows the EQ indicator alongside the S&P 500 over the past 4 years and 23 years, respectively.
Indicator values below zero indicate the stock market has outpaced new money entering the economy, and the market is in dangerous territory. An indicator value of 1.0 is the average value over the past 50 years, and indicates a potential for average market growth. An indicator of 2.0 and above is a very bullish sign and indicates a potential for above-average market growth.