The overstep nautical chart monitors all mutual stocks traded on the major exchanges making three-month novel highs vs. three-month novel lows. We tin run across from the nautical chart that this turn down has been much broader than ones previous. New lows hitting their maximum degree thus far on Oct tenth in addition to thus held slightly higher upwards that degree at the marketplace depression on Oct 15th. With yesterday's buying interest--my Buying Power measure hitting its highest degree since 2012 yesterday--new lows dried upwards in addition to thus far inward premarket today we're seeing continued buying interest. This suggests a momentum depression has been set inward place.
The 2d nautical chart tracks the number of NYSE issues closing higher upwards vs. below their upper/lower Bollinger Bands, which I mention to equally the Bollinger Balance. Note over again the recent persistent weakness, the failure to expand the number of shares closing below their bands at the recent lows, in addition to at i time the drying upwards of that weakness.
As I've stressed inward the past, it helps to intend of topping in addition to bottoming equally processes, non equally fixed points on a chart. Markets brand bottoms when they hitting a momentum low, bounce, in addition to thus subsequent weakness occurs amongst less downside momentum in addition to volatility in addition to fewer shares making novel lows. It would surprise me if this bottoming procedure is over--a full general dominion is that to a greater extent than extensive declines undergo to a greater extent than protracted bottoming--but a continued drying upwards of weak breadth is something I'll hold upwards on the ticker for to detect opportunities to scoop upwards roughly value.
Further Reading: Finding Opportunity inward Stock Market Cycles
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