Here is some $SPX Market Breadth Data. My absolute favourite indicators of Breadth are New High vs New Low, Advance Decline & % of Stocks over the Key Moving Averages. Remember and Index is a basket of stocks so it will ALWAYS lag the stocks. So let's take a look at the $SPY SPX

Below we have a clean chart of the Index on a weekly timeframe. I suggest looking at the 2020 Bull Market first. Our first indicator is the New Highs vs New Lows. As you can see in a bull market we have plenty of new highs, nothing complicated there. See as the market topped out new lows started popping for the first time in a year? The index goes higher (Because it Lags) and then it fails. Nobody could tell from New High vs New Low whether we are going to to have a correction or a large bear. It's just a piece of the puzzle.

Below this we have the % of Stocks over their 200 Day Moving Average. This is a long term moving average and as you can see really began to decline long before the Index topped. In fact by the time the index tops it has declined a lot. This is breadth deteriorating over a number of months, less stocks are participating and only a few are holding up the Index. This can't last forever and just as the New High vs New Lows turns we have the final straw and the market begins to fade.

So what is happening now? Now, for the first time we are beginning to see a steady increase in participation. This has been improving for months now, New Highs vs New Lows also improving. Also it is worth noting that the EQUAL WEIGHT S&P is outperforming the weighted, meaning if you balance out the megacaps the other stocks are now doing better than before. This is all positive news. Is it a new Bull market? I have no idea. Right now we're testing that idea. We could absolutely roll over here.

For some reference here is the 2008 Period with the same indicators.You can see that we really didn't get the same participation improvement before that massive rollover. These are just some basic indicators but they help a lot, and help a person zoom out.

Below is the same indicators across the $QQQ

Hope you enjoyed this post and it helps you out.