Peeking at Market Internals on the Breakout to New Highs

Jul 17, 2017: 1:00 PM CST

What are market internals saying about the recent big bullish breakout to new all-time highs?

Let’s take a look and listen to the message beneath the market:

SP500 S&P 500 Market Internals Bullish Breakout

We listen to the message from price which is saying “I’m breaking out – I’m all new all-time highs.  I’m very bullish.”

Great, Mr. Market – that’s wonderful.  But what is Mr. Market  Internal saying?

We’re charting the “Big Three” NYSE Breadth (top), TICK (middle), and Volume Difference (of Breadth) as our main market internals.

First, we saw a CONFIRMATION or bullish surge on July 12th when price broke through the falling trendline.

This allowed us to call for higher prices yet to come via a Bullish Dominant Thesis in our Membership Report.

Price did actually travel the bullish “Open Air” price pathway toward then above the 2,450 target.

Market Internals were decently strong last Friday but not quite as bullish as the July 12th breakout.

That’s fine – as a rally continues, internals, volume, and momentum tend to diverge.

However, we’re concerned today with the weak showing of all three key Market Internals as price stagnates – for now – at the 2,460 resistance level.

For the rest of the day and into Tuesday, continue monitoring price at the highs (telling you how bullish it is and how great the market is) and balance that with the more cautious message whispered by Market Internals.

 

 

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Corey Rosenbloom, CMT

Afraid to Trade.com

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