We had a breadth thrust trigger: The Triple 70 Thrust.
Here’s the chart:
Let's break down what the chart shows:
The blue line in the top panel is the S&P 500 index price.
The black line in the bottom panel shows the Triple 70 Thrust indicator.
The red line in the bottom panel is the trigger level for a breadth thrust.
The gray shading highlights when a breadth thrust has been reached.
The Takeaway: Yesterday, one of my favorite breadth thrusts triggered: The Zweig Breadth Thrust, which Alfonso wrote about here.
But that wasn't the only thrust we saw yesterday; one of my other top-ranking breadth thrusts triggered.
The Triple 70 Thrust.
This thrust is triggered when the percentage of rising NYSE stocks in the market exceeds 70% for three consecutive days.
We saw 91% of stocks rise on Tuesday.
Then, 75% of stocks rose on Wednesday.
And yesterday we saw 84% of stocks rise.
Once the threshold of three consecutive days exceeding 70% of stocks rising is met, it signals a breadth thrust… which indicates to me that there is healthy participation beneath the surface.
While the Bulls still have challenges to overcome, this is a solid start for them to regain control.
Looking back at the past performance of the Triple 70 Thrust it shows some impressive numbers. Over 95% of the time, a year later, the markets are, on average, up over 19%.
This thrust and the Zweig Breadth Thrust definitely belong in the bullish bucket. It's the first time in quite a while that I've added something to the bullish bucket.
However, please note that this is not an all-clear signal or a guarantee that the market will rise, but it does contribute to my weight-of-evidence approach.
Will we see more breadth thrust trigger over the coming days to really confirm that the bulls are back!?
Grant Hawkridge | Chief Aussie Operator, All Star Charts
PS: Kenny Glick went live yesterday to explain his trading strategy and how he uses it to trade the biggest movers every day. Watch the replay here.
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