Market Analysis: Bad Breadth

DISCUSSION  The latest Cracked Market blog post highlights well the current buy-the-dip attitude of index-focused market participants.  Frankly, it's quite strange. A mere cursory look at underlying demand measures such as a basic 200dma breadth chart reveals an equity market that is carving out a textbook "negative divergence".  Whatever. The market will do what it … Continue reading Market Analysis: Bad Breadth

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Market Analysis: Ritholtz/”Down Town”/”Common Sense” Strike Again

Per usual, with the market up for more than 60 seconds the "Ritholtz/"Down Town"/"Common Sense" buy-the-dippers are out in force declaring those who care about valuation and that increasingly esoteric "margin of safety" concept out of touch. The "Common Sense" leg of the less-than-$600 million AUM trifecta that makes up Ritholtz Wealth Management, on August … Continue reading Market Analysis: Ritholtz/”Down Town”/”Common Sense” Strike Again

Market Analysis: 2014 Market Analog (?)

50dma breadth is a useful tool for gauging short-term market bottoms. At present, 44% of SPX stocks are above their 50dma, which is just above the YTD lows of around 40%. If the market wants to hold 40% level, then the selling is almost finished. But given the poor seasonality and deteriorating longer-term breadth (i.e. … Continue reading Market Analysis: 2014 Market Analog (?)