Breadth indicators on their 5th attempt at a bottom...

The ol' guard breadth indicators have had a rough year detecting the bottom. I was of the opinion the January bottom was 'the One' but this was later proved to be folly once the July retest collapsed in September.

We now have new lower boundaries for the breadth indicators which gives us a base going forward. These boundaries show considerably upside room - even if this room is only to former bull market support (let along resistance!).

The late October attempt at a bottom wimped out with new market lows, but as happened in March we have a bullish divergence between the breadth indicators and the market itself. Even in March this was enough for a 2-month rally. Another 2-month rally here would fit seasonal trends in addition to been a welcome relief.

Dr. Declan Fallon, Senior Market Technician, the free stock alerts, market alerts and stock charts website

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