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Bullish Percent Index still in positive territory By Prieur du Plessis, on February 1st, 2010 posted in: Investment, Markets, Money  5 people had their say - chime in!
I have considered a number of market breadth indicators in recent posts in order to gauge how the bulls and the bears are exerting themselves. The Bullish Percent Index is another useful tool in this regard and shows the percentage of stocks currently in bullish mode as a result of point-and-figure buy signals. Analyzing the benchmark US indices, it is interesting to note that more than 61% of the stocks comprising these indices are still in buy mode according to point-and-figure signals.
Source: StockCharts.com Zeroing in on the underlying economic sectors, a similar picture emerges, with Telecoms (58.8%) the least bullish.
Source: StockCharts.com While the short-term indicators are flashing correction, the longer-term measures such as the Bullish Percent Index and 200-day moving averages are still in bullish mode. Until the primary trend indicators break down it looks like a correction in a bull market, but the uncertainty nevertheless warrants a great deal of caution. More on this topic (What's this?) Bullish Technicals Forming In The Midst Of The Correction (Disciplined Approach to Investing, 9/10/15) Steep Drop In Bullish Investor Sentiment (Disciplined Approach to Investing, 7/30/15) Bull Market to Continue on Near-Term Price Strength (Jutia Group, 11/21/14) 5 comments to Bullish Percent Index still in positive territoryLeave a Reply |
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Although still bullish, the BPNYA has adjusted to a col. of “O” indicating bear alert.
“>>>>>warrants a great deal of caution” Would be interesting to view whatever you come across as to what specifically one might do to be cautious given the market position.
as always thanks for all you do. look forward to your posts more than any other on the net.
[...] The bulls are nominally still in charge in the US equity market. (Investment Postcards) [...]
I agree that we are now on Defense (column of O’s). Dorsey Wright & Associates suggests using tighter stops, trim offense positions, buy ETF’s to avoid the single stock risk, buy puts, sell laggards on breakdowns, and increase noncorrelated exposure.
I dunno! The way the market is behaving it is hard to tell what is going to happen. It looks like a correction to me, but I’ve been wrong before. I mean GDP and earnings fall, and the market goes up! GDP and earnings improve, and the market goes down! Doesn’t make a great deal of sense and, hence, a correction is implied.
What I meant is that I think that the market is correcting against a rally.