The Summation Index rises while the McClellan Oscillator is above zero and falls while it is below zero, so its direction shows whether breadth momentum has been positive or negative over recent weeks. A turn up from a deep low often confirms that a market bottom is in place, and a turn down from a high warns that the advance is losing support. Traders also watch for divergences: an index that keeps rising while the Summation Index falls is advancing on fewer and fewer stocks. Because it moves slowly, the Summation Index filters out the day-to-day noise of the Oscillator and suits position traders and investors.
The charts above show the McClellan Summation Index 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 52-Week High Stocks, New 52-Week Low Stocks and Price Crossed Above MA(200) Stocks. You can also use market breadth as a filter in your own screens and strategies in the Formula Screener and the Strategy Backtester.
The McClellan Summation Index is a market breadth indicator that adds up the daily values of the McClellan Oscillator. It shows the intermediate-term trend of market breadth.
Each day, the current McClellan Oscillator value is added to the previous value of the Summation Index, so the index is a running total of the Oscillator.
A rising Summation Index means the Oscillator is above zero and breadth is improving; a falling one means breadth is deteriorating. Turns from extreme highs or lows and divergences from the price index can signal major trend reversals.
Neither is better; they serve different horizons. The Oscillator reacts quickly and suits short-term timing, while the Summation Index is smoother and suits the intermediate-term trend. Many traders use both together.
Yes. In the Formula Screener, msi is the McClellan Summation Index. For example, (msi > msi@5)@sp500 and rsi(14) ca 30 finds stocks whose RSI crossed above 30 while the S&P 500 Summation Index is higher than a week ago.
