AI
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| Alias Born | 04/01/2000 |
Monday, September 02, 2013 9:53:50 PM
Market tops are made as market breadth weakens when compared to previous strength. Although I have been highly skeptical of this market advance almost since the day it began in March of 2009 it's not likely done making new highs before it tops.
The Fed has done a tremendous job of making the stock market look attractive to investors. There are a lot of warning signs out there to me. We've been discussing them for some time.
My recent research indicates that if the next market top comes with poor market breadth then it might be the final nail. But that would be true only if the next top comes with a huge drop in new highs for the market.
There are 1514 stocks on the NYSE:
http://en.wikipedia.org/w/index.php?title=Category:Companies_listed_on_the_New_York_Stock_Exchange&pagefrom=United+Continental+Holdings#mw-pages
On average the last 14 major market tops since 1900 were formed while only about 6% of the listed stocks were hitting new highs. At the most recent high for the NYSE almost 400 stocks hit new highs on the day.
That was about 25% of the stocks on the NYSE hitting new highs on that day. This may be the most insightful post I have ever shared here because I do think it helps to clear up why the bulls are still right for now. It does not matter how valid our worries might be about the market as long as it can see that kind of participation while making new highs the bull is healthy.
RtS
The Fed has done a tremendous job of making the stock market look attractive to investors. There are a lot of warning signs out there to me. We've been discussing them for some time.
My recent research indicates that if the next market top comes with poor market breadth then it might be the final nail. But that would be true only if the next top comes with a huge drop in new highs for the market.
There are 1514 stocks on the NYSE:
http://en.wikipedia.org/w/index.php?title=Category:Companies_listed_on_the_New_York_Stock_Exchange&pagefrom=United+Continental+Holdings#mw-pages
On average the last 14 major market tops since 1900 were formed while only about 6% of the listed stocks were hitting new highs. At the most recent high for the NYSE almost 400 stocks hit new highs on the day.
That was about 25% of the stocks on the NYSE hitting new highs on that day. This may be the most insightful post I have ever shared here because I do think it helps to clear up why the bulls are still right for now. It does not matter how valid our worries might be about the market as long as it can see that kind of participation while making new highs the bull is healthy.
RtS
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