The New Highs - New Lows indicator is positive when more stocks in the index reach new 52-week highs than new 52-week lows, and negative when lows dominate. A cross of the zero line is a simple signal of a change in market leadership from bears to bulls or back. Its 10-day moving average smooths the daily swings and makes the trend easier to read. The strongest warnings come from divergences: an index that keeps rising while fewer stocks make new highs is advancing on a narrowing base, and an index that falls to a new low with fewer new lows shows that selling is losing breadth.
The charts above show the New Highs - New Lows 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 All Time New High Stocks. You can also use market breadth as a filter in your own screens and strategies in the Formula Screener and the Strategy Backtester.
New Highs - New Lows is a market breadth indicator that shows the daily number of stocks in an index reaching new 52-week highs minus the number reaching new 52-week lows.
Count the stocks in the index that closed at a new 52-week high and those at a new 52-week low, then subtract the lows from the highs.
It means more stocks are making new 52-week lows than new highs, so bears control the market. Extremely negative readings often appear near major market bottoms.
A bearish divergence occurs when the index makes a new high while the indicator makes a lower high, so fewer stocks join the advance. A bullish divergence is the opposite during a decline.
Yes. In the Formula Screener, nhnl is the indicator and nhnlma is its 10-day SMA. For example, (nhnlma > 0)@nasdaq and rsi(14) ca 30 finds stocks whose RSI crossed above 30 while more Nasdaq stocks make new highs than new lows.
