Breadth Dashboard

Shown below are the closing Breadth Dashboards from each day over the past week, from newest down to oldest. While the Acceleration(vs. slower lookback) and Momentum(vs. prior period) rows already get color-coded for the evolving state of market breadth, some may find better value in a set of moving pictures.

Monday April 7 $SPX 1845.04

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Friday April 4 $SPX 1865.09

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Thursday April 3 $SPX 1888.77

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Wednesday April 2 $SPX 1890.90

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Tuesday April 1 $SPX 1885.52

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Monday March 31 $SPX 1872.34

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Friday March 28 $SPX 1857.62

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This is where trade planning begins, not ends. By organizing the health of the active stocks most correlated to $SPY, I’m able to set stops and trigger as index components make impulse moves rather than waiting on the index to break. In many cases, these acts are simultaneous, but I have more confidence when a number of key stocks move in tandem than when $ES_F “breaks out” by .25; this dashboard acts as a great BS filter.

If you find it relevant to your trade planning or risk budgeting, I’d recommend reading it as follows:

1) Top to Bottom-   compare today’s Swing section to yesterday’s. It’s constantly in flux, but this measure of market direction generally stays in place for 1-8 days.  Position phases run for weeks, Invest for months. It takes broad buying or selling to shake these longer frames out of phase, but comparing today’s Position scores to those of a week prior is a good tipoff.

2) Left to Right- while trade setups occur when the Swing(or even Day, not shown) timeframe shifts, it makes no sense to ignore the greater, more stable forces of the longer timeframes. A dominant bull in the Invest columns means a Position bear should be ready to switch back to bull on a moment’s notice, and vice versa.

3) “Absolute” Rows-  as Bayes theorem reminds us, looking at only the incremental changes leaves our trade map void of a compass. I made the divergence mistake countless times before acknowledging that high(or low) absolute breadth, even if weakened(strengthened) a bit, is NOT to be fought…at least not before the masses invite reversion by overindulging the index trend. So, 85% “healthy” vs. 90% prior may be “less good” but it’s a mistake to call it bearish without falling below 70% first.

It’s been a years-long effort to collect and store the data my way, but thankfully the right TradeStation expert came along to automate that part of it. I can now focus on the important part, using the data in a repeatable process to plan trades.  The goal here in this space is to hide my messy work and let the message step forward. Let me know if you can think of ways to refine its presentation, wide open to suggestions.