Tuesday, September 17, 2013

Market Breadth Has Been Bullish

I am crunched for time today, I will be back with more tomorrow, but I wanted to post the following exhibits.

Since the low of August 27th, the market (S&P 500) has staged an impressive rally, climbing by more than 4% in that brief time. It's very encouraging to see that this rally off the low has been broad-based as market breadth has more than kept up, showing few if any signs of bearish divergences.

In fact, the A/D line for the S&P 500 has pulled ahead of the Index:

Source: Bloomberg

This bullish market breadth can also be seen with the equal-weight S&P 500 (RSP) recently hitting new highs versus the SPY:

Source: Stockcharts.com

Finally, at the risk of overkill, the following exhibit shows equal-weight S&P 500 sectors versus the S&P 500 (cap-weighted):

Source: Stockcharts.com

Of the nine major sectors, six have outperformed the Index, two have slightly underperformed and utilities have just been crushed. Overall the equal-weighted representation further shows solid breadth in this recent advance, a bullish tailwind for the market.

I must run but will have more tomorrow.

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