20130517 Moving Average Breadth
Another strong week in the markets flying in the face of the rampant skepticism. Last week I mentioned that extremely strong breadth is….strength, and again this week I hear people talking about the breadth being too strong. Don’t over think this. Yes, when breadth figures get into the 90% range across the board then it is time to be ready for a short term pullback, but more times than not we diverge off such highs before going into a longer term sell off. So, let me try this a different way.
Strong Breadth = Market Strength
First, the Total universe of 1898 companies posted over the $SPY
Next I split the universe into 10 custom broad sector indexes
Consumer Discretionary (325)
Consumer Staples (91)
Energy (132)
Financials (316)
Health Care (199)
Industrials (252)
Materials (148)
Technology (338)
Telecom (24)
Utilities (73)
These are custom indexes so you cannot invest directly in them, but there are plenty of ETFs available for each sector. For me personally this is another form of relative strength, just with a broader lens .
Good Luck! It is there for you to make.
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