The indicator moves between 0% and 100%. A cross above 50% shows that most stocks in the index are now in intermediate uptrends, and a cross below 50% shows that most are in downtrends. The 50-day version reacts to swings that last a few weeks to a few months, so it often turns before the index itself does. Divergences are worth watching as well: when an index makes a new high but fewer stocks trade above their 50-day moving average, the rally is narrowing.
The charts above show the % of stocks above the 50-day moving average under the price of 24 stock indexes, from the S&P 500, Nasdaq 100 and Russell 2000 to the FTSE 100, DAX and Nifty 50, so you can compare breadth across markets at a glance. Click a chart to open a larger version.
Related stock screens: New 13-Week High Stocks, New 13-Week Low Stocks and Price Crossed Above MA(26) Stocks. You can also use market breadth as a filter in your own screens and strategies in the Formula Screener and the Strategy Backtester.
It is a market breadth indicator that shows the share of stocks in an index trading above their own 50-day simple moving average. It measures how broad the intermediate trend is.
For each stock in the index, the close is compared with its 50-day moving average. The number of stocks above the average is divided by the number of stocks in the index and multiplied by 100.
Readings above 50% mean most stocks are in intermediate uptrends. Readings above 70% to 80% show broad strength but can also mean the market is overbought, while readings below 20% to 30% point to an oversold market.
When fewer than 20% of stocks trade above their 50-day moving average, selling has been broad and the market is oversold. Such readings often appear near intermediate-term bottoms, although they can persist in a bear market.
Yes. In the Formula Screener, a50ma is this indicator. For example, (a50ma > 50)@nasdaq and price ca sma(50) finds stocks crossing above their 50-day SMA while most Nasdaq stocks are above theirs. The same condition works as a market filter in the Strategy Backtester.
