Market Breadth

Purpose

Determine whether a market move is broad or narrow. An index at a new high driven by five stocks while most constituents are falling is a different market from an index at a new high with broad participation — and the index price alone cannot tell you which one you are in.

When to Use

• Assessing whether an advance is healthy or narrowing.
• Looking for divergence between the index and its internals.
• Confirming a bottom or identifying a distribution phase.
• Setting overall exposure based on market health.

Capabilities