When SPX Closes Higher on Bad Breadth

By Rob Hanna

While the SPX closes higher on Tuesday, NYSE breadth was weak – both from an % Up Issues and % Up Volume standpoint. This triggered the study below from the Quantifinder. I also discussed it in last night’s subscriber letter.

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Here we see numbers suggesting a substantial bearish edge over the next 1-4 days. Below is the full list of instances and their 4-day returns.

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Aside from the one trade in 2012, the moves lower have been generally strong and very consistent. Traders may want to take this into consideration when setting their bias for the next few days.

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Gary

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