In this thread ๐งต๐งต๐งต I will explain:
1. How could you have used (if at all) Market breadth indicators, to anticipate the recent fall, and
2. If today was a Bottom
*Disclaimer: Most of it is hindsight and most of it is my original synthesis. Therefore a work in progress
1/8
1. How could you have used (if at all) Market breadth indicators, to anticipate the recent fall, and
2. If today was a Bottom
*Disclaimer: Most of it is hindsight and most of it is my original synthesis. Therefore a work in progress
1/8
1. The High-low index:
The supporting trendline in CNX500 broke down convincingly on 21st December while the High-low broke down 2 days early on the 19th and was way below the trendline on the 21st.
2/8
The supporting trendline in CNX500 broke down convincingly on 21st December while the High-low broke down 2 days early on the 19th and was way below the trendline on the 21st.
2/8
2. Percentage of Stocks above their key moving averages 200DMA: Regular Divergence
While the price made a Higher High, the PSA (percentage stocks above) 200DMA made a high equal to the previous high showing lack of strength
3/8
While the price made a Higher High, the PSA (percentage stocks above) 200DMA made a high equal to the previous high showing lack of strength
3/8
3. . Percentage of Stocks above their key moving averages 50DMA: Regular Divergence
While the price made a Higher High, the PSA (percentage stocks above) 50DMA made a lower high signaling less strength.
4/8
While the price made a Higher High, the PSA (percentage stocks above) 50DMA made a lower high signaling less strength.
4/8
4. The RSI overbought indicator:
Markets almost never stay overbought or oversold for too long and are bound to revert back. Naturally, the market tops and bottoms coincide with overbought tops and oversold tops
The overbought indicator tops diverged with CNX500 price tops
5/8
Markets almost never stay overbought or oversold for too long and are bound to revert back. Naturally, the market tops and bottoms coincide with overbought tops and oversold tops
The overbought indicator tops diverged with CNX500 price tops
5/8
5. The RSI oversold indicator:
The oversold indicator generally tops at market bottoms and it topped last Friday and reversed with markets turning up today, signaling a potential near-term bottom.
6/8
The oversold indicator generally tops at market bottoms and it topped last Friday and reversed with markets turning up today, signaling a potential near-term bottom.
6/8
6. The number of stocks making 52-week high close:
This was epic.
A sharp drop off in the number of stocks making a new 52-week high close on 19th December, from 120 to 9 (>10X drop) while the price was still at the trendline support.
Price fell after 2 days on 21st
7/8
This was epic.
A sharp drop off in the number of stocks making a new 52-week high close on 19th December, from 120 to 9 (>10X drop) while the price was still at the trendline support.
Price fell after 2 days on 21st
7/8
End of thread ๐งต
If u found this thread useful, please follow @SakatasHomma for more.
I trade and mentor beginners in the stock market.
Please like and retweet the 1st tweet of this thread and help me find more people to help.
Thanks
8/8
If u found this thread useful, please follow @SakatasHomma for more.
I trade and mentor beginners in the stock market.
Please like and retweet the 1st tweet of this thread and help me find more people to help.
Thanks
8/8
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I write on technical analysis and general Financial literacy.
Do subscribe
sakatas.substack.com
I write on technical analysis and general Financial literacy.
Do subscribe
sakatas.substack.com
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