Monday, July 30, 2007

Market Breadth

This chart shows the percentage of NYSE stocks that are two standard deviations from their 200 day moving averages. Clearly there is something different this time with regard to the market breadth. The reading of 32% is already much larger than the four most recent market corrections and looks to most resemble the LTCM panic of 1998. This should not be surprising since in these later days of the markets rise it was clear that the large-caps were holding up most of the market averages (S&P 500, Dow, Nasdaq 100).

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