Stage Analysis Forum - Trading & Investing using Stan Weinstein's Stocks Breakout method
Stan Weinstein's Stage Analysis and Market Breadth - Technical Analysis - Printable Version

+- Stage Analysis Forum - Trading & Investing using Stan Weinstein's Stocks Breakout method (https://www.stageanalysis.net/forum)
+-- Forum: Main Board (https://www.stageanalysis.net/forum/Forum-Main-Board)
+--- Forum: Stan Weinstein's Stage Analysis - Stock Charts, Technical Analysis, Learn to Trade, Stocks, ETF, NYSE, Nasdaq (https://www.stageanalysis.net/forum/Forum-Stan-Weinstein-s-Stage-Analysis-Stock-Charts-Technical-Analysis-Learn-to-Trade-Stocks-ETF-NYSE-Nasdaq)
+--- Thread: Stan Weinstein's Stage Analysis and Market Breadth - Technical Analysis (/Thread-Stan-Weinstein-s-Stage-Analysis-and-Market-Breadth-Technical-Analysis)

Pages: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221 222 223 224 225 226 227 228 229 230 231 232 233 234 235 236 237 238 239 240 241 242 243 244 245 246 247 248 249 250 251 252 253 254 255 256 257 258 259 260 261 262 263 264 265 266 267 268 269 270 271 272 273 274 275 276 277 278 279 280 281 282 283 284 285 286 287 288 289 290 291 292 293 294 295 296 297 298 299 300 301 302 303 304 305 306 307 308 309 310 311 312 313 314 315 316 317 318 319 320 321 322 323 324 325 326 327 328 329 330 331 332 333 334 335 336 337 338 339 340 341 342 343 344 345 346 347 348 349 350 351 352 353 354 355 356 357 358 359 360 361 362 363 364 365 366 367 368 369 370 371 372 373 374 375 376 377 378 379 380 381 382 383 384 385 386 387 388 389 390 391 392 393 394 395 396 397 398 399 400 401 402 403 404 405 406 407 408 409 410 411 412 413 414 415 416 417 418 419 420 421 422 423 424 425 426 427 428 429 430 431 432 433 434 435 436 437 438 439 440 441 442 443 444 445 446 447 448 449 450 451 452 453 454 455 456 457 458 459 460 461 462 463 464 465 466 467 468 469 470 471 472 473 474 475 476 477 478 479 480 481 482 483 484

RE: Cumulative P&F Breakouts - Breakdowns custom Breadth charts - malaguti - 2019-05-17

(2019-05-12, 12:20 PM)isatrader Wrote: Attached is my updated custom breadth charts that I do based on the daily point and figure double top breakouts and double bottom breakdowns.

Totals for the week:

+227 double top breakouts
-432 double bottom breakdowns

-205 net breakouts - breakdowns

can i confirm my understanding based on this information and current market action..
taking the relationship of the daily breakouts vs breakdowns and the 200 day ma of that info, which correlates to a 50week ma
in mid december the ma broke through zero, culminating in the market (s&p) correcting quite violently
since then, the S&P has gone on to reach new all time highs whereas the ma has not crossed back above zero
which ultimately signals an inherent weakness and calls into question somewhat the recent advance. and now we have a correction..
thats what im reading into these numbers

i guess two questions come to mind..
1) how does the overall ma affect the overall market to "allow" an advance to new highs without being substantiated by a series of new breakouts. my take on that question would be the weighting of the constituents. you could have 200 breakdowns outweighed by one breakout and the relative weighting of that 1 could tip the s&p upward even though everything else is negative
2) how can we benefit from that information. could/should we be amending investor/trader methods to be more short term in nature where we have this weakness and then switch back to investor when all aligns

fascinating

RE: Stan Weinstein Stage Analysis and Market Breadth - isatrader - 2019-05-17

It's hard to say if it shows inherent weakness or just a lag that is more representative of the broad market position (see NYSE and COMPQ charts). As we don't have past data to compare against. However, it moves in similar ways as the advance decline data, and Percentage of Stocks above their Moving Averages. So based on those, the longer term measures like the 200 day are more useful as confirmation data imo, as the short term indicators give new buy signals earlier after a Stage 4 decline, and tend to move back to the tops of their ranges and then pullback towards the middle of the range on corrections, with not too much depth below the zero line on those pullbacks. So once we see all the time frames for the point and figure double top breakouts and double bottom breakdowns on buy signals then we'll likely be back in Stage 2 phase. So I think the fact that the 200 day longer term measure hasn't yet given a buy signal means that we are still operating in a Stage 1 phase.

On your questions.
1) Weighting is the key here. Indexes might be averages of the stocks in them but they are not equal weighted, so like you said can be moved by their largest components and distort the actual position of the market. This is why I like the breadth indicators so much like the point and figure double top breakouts and double bottom breakdowns, advance decline, and Percentage of Stocks above their Moving Averages etc. As they all show an unbiased view of the market strength, and so can be used to assess risk, and hence when to be more aggressive or more cautious with your portfolio.

2) That is how I play it, as I use these for risk assessment. So unless all the time frames, i.e 10 day, 20 day, 50 day and 200 day are all on a buy signal, then I tend to be much stricter. So for example, at the moment I'm only about 65% invested in my pension portfolio, and only have a single position open in my short term trading account.

RE: Stan Weinstein Stage Analysis and Market Breadth - pcabc - 2019-05-17

(2019-05-17, 05:25 PM)isatrader Wrote: On your questions.
1) Weighting is the key here. Indexes might be averages of the stocks in them but they are not equal weighted, so like you said can be moved by their largest components and distort the actual position of the market. This is why I like the breadth indicators so much like the point and figure double top breakouts and double bottom breakdowns, advance decline, and Percentage of Stocks above their Moving Averages etc. As they all show an unbiased view of the market strength, and so can be used to assess risk, and hence when to be more aggressive or more cautious with your portfolio.

I can see what you are saying, however, looking at the data I have seen some thinly traded or very small value stocks move very wildly whereas the larger ones don't.  Care would be needed that these very small thinly traded stocks do not mess up the outcome perhaps?  On the other hand, if they are numerous and fairly random perhaps they cancel, and if a large number move in unison then that is good data?

Not a useful conclusion, just a thought.

RE: Stan Weinstein Stage Analysis and Market Breadth - isatrader - 2019-05-17

(2019-05-17, 09:14 PM)pcabc Wrote: I can see what you are saying, however, looking at the data I have seen some thinly traded or very small value stocks move very wildly whereas the larger ones don't.  Care would be needed that these very small thinly traded stocks do not mess up the outcome perhaps?  On the other hand, if they are numerous and fairly random perhaps they cancel, and if a large number move in unison then that is good data?

Not a useful conclusion, just a thought.

Those kinds of micro cap stocks are not really included in the numbers. As only US stocks from the major exchanges with a market cap of above $1million are scanned, and no stocks from the OTC (over the counter market) are included either, where the majority of those kinds of thin stocks are traded. And also the way point and figure charts work is to filter insignificant price movements and noise, as the P&F traditional box scaling method that is used requires bigger percentages moves in the smallest stocks to add a single X. For example a $5 stock uses a 0.5 scale, so to add an X it needs to move 10%. Whereas a $50 stock only needs to move 2% to add an X. See https://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:pnf_charts:pnf_basics for how it works. But with the traditional box scaling and a 3 box reversal it does a pretty good job of only capturing more significant moves in a stock, and filtering out the rest of the churn. As to get on the daily list the stock needs to have made a P&F double top buy signal or P&F double bottom sell signal.

RE: Stan Weinstein Stage Analysis and Market Breadth - pcabc - 2019-05-18

Breadth

For equities, with my scoring system in the last day or two breadth has strengthened compared to the dip earlier in the week.  However, the shorter term momentum, based on MACDs versus their singal lines of various breadth indicators, is still negative.

US:
           
Ignore the glitch in the NASDAQ chart.

UK:
           

Oil and gold:
       

RE: Stan Weinstein Stage Analysis and Market Breadth - grbaNT - 2019-05-19

Attached are the updated charts of the RABWDB Indicator, Individual Phases, SP500 RABWDB, SP400 RABWDB and SP600 RABWDB.

To learn more about the indicator go to https://dg-swingtrading.blogspot.com/search/label/RABWDB

RE: Stan Weinstein Stage Analysis and Market Breadth - grbaNT - 2019-05-19

Attached are the updated charts of the US Stock Market Survey Indicator, Individual Stages, SP500 Survey, SP400 Survey and SP600 Survey.

If you want to read my commentary, please go to https://dg-swingtrading.blogspot.com/search/label/The%20Survey

Major US Stock Indexes Update - NYSE, Nasdaq, S&P 500, Nasdaq 100, DJIA & S&P 600 - isatrader - 2019-05-19

Here's the weekly overview charts of the NYSE, Nasdaq, S&P 500, DJIA & S&P 600 small caps with their US Bullish Percent and Moving Average Breadth.