The NYSE Composite Trending – New 52-Week Highs NYHL Are Bullish
The NYSE Composite of 2000 stocks coupled with 52-week highs provides a broad measure of market participation, strength or weakness and general health of U.S. equities on a rolling basis. Consulting this barometer of market sentiment and breadth assists us in determining our course of action in a short and intermediate term horizon.
NYHL New 52-Week Highs Beating 52-Week Lows is Bullish
Monitor the upper panel. While markets never go straight up or straight down, the histogram in the upper panel is read as bullish when above the zero-line and bearish when below. The moving average helps with cycles. Price action is referenced with an Elder Impulse Chart.
Note NYSE is green for 7 days after retaking the 20d. There is little supply between current price levels and all time highs at 13,600 (+/-). That is our target, the end of the year.
NYHL Meets NYAD
Adding a breadth indicator like advancing and declining stocks for the broad market helps confirm the trend. At the moment, this 7 day move above the 20d is confirmed as more advancing stocks are confirming those making fresh 52-week highs.
With these three points in mind, NYHL, price and NYAD, we can assume the intermediate trend will remain intact. This is occuring as the S&P 500 registers new all time highs.
We also use the 60min chart for intraday trading or day trading confirmation. Monitor the moving average (black line). Use the peaks and valleys as reference points.
As an example, August 21 and 22 saw a peak in the NYHL, followed by a lower high and a lower peak the week of August 27 ~ 31. If you were in a long swing from the night before or over the preceding weekend, we would stop and take profits as price dropped below the 20 period moving average. We go long on reversals like the second week of September.
Since the markets trend higher the majority of the time, monitoring the short and intermediate term changes in 52-week highs can alert you to reversals. When the majority of 52-week highs begin to fail to follow through on NYHL charts or a peak forms, monitor closely. Worse yet, if the histogram drops below zero-line that is a caution signal for the current trend. Begin reducing position size.
Use the NYHL and monitor 52-week highs. We promise it will help your trading acumen.
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