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CHART OF THE DAY: BREADTH AT EXTREMES

From Bespoke Invest:

The 10-day advance/decline line is a widely followed breadth indicator that is used to measure both the health of a move as well as inflection points.  It is calculated by finding the average daily number of advancers minus decliners over the last ten trading days.  Below we highlight a chart of the 10-day advance/decline line for the S&P 500.  As shown, the recent rally has put the 10-day A/D line well into overbought territory and at a level that has indeed marked a peak during prior rallies in the past year.  During the rally in early December and the initial rally off the March lows, the 10-day topped out right where it is now.  After 12 up days for the Nasdaq and an average gain of 13% for S&P 500 stocks since July 10th, it’s time for a breather.

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