Primary Indicators

Most investors rely on a few favorite stock market indicators, and new ones seem to pop up all the time, but the two most reliable ones for determining the strength of the market are price and volume. Most other stock market indicators are derived from price and volume data. So it stands to reason that if you follow the price and volume action on the major market indices each day, you will always be in sync with the current trend.

Advance/Decline Line

Plots the number of advancing shares versus the number of declining shares. At times, a small number of larger weighted stocks may experience significant moves, up or down, that skew the price action on the index. This line, and its accompanying data, reveals whether a majority of stocks followed the direction of the major indexes on that day.

A 10-day moving average of the number of stocks moving up in price less the number of stocks moving down in price (for a specific exchange). Stocks with prices that did not change from the previous close are not included in this calculation. Some investors may use this indicator to take a contrarian position when the market has moved too in far in one direction over a short period of time.

Two 10-day moving average lines are presented to illustrate the volume of all stocks on an exchange (AMEX, NASDAQ, NYSE) that are moving up or down in price. Blue line: A 10-day moving average of the total volume of all stocks on an exchange moving up in price. Pink line: A 10-day moving average of the total volume of all stocks on an exchange moving down in price. When the two lines cross, this may indicate a trend change in favor of whichever line is moving up.

10 Day Moving Average New Highs & New Lows

Two 10-day moving average lines are presented to illustrate stocks reaching new highs and new lows, corresponding to their specific exchange (AMEX, NASDAQ, and NYSE). Blue line: a 10-day moving average of the number of stocks making new price highs. Pink line: a 10-day moving average of the number of stocks reaching new price lows (based on prices at market close). When the two lines cross, this may indicate a trend change in favor of whichever line is moving up.

NYSE Short Interest Ratio

Economic Calendar

An economic calendar is a list of current and upcoming announcements for a variety of Economic Indicators. It includes the period the announcement covers as well as the consensus estimate for each indicator, if available. The market tends to react favorably when positive numbers are reported. Keep in mind that the market may have already priced in the result of the announcement based on the consensus estimate prior to the announcement. Thus, when the reported numbers fall short of the consensus estimate, the market may react unfavorably.

Other Psychological (Sentiment) Indicators

The CBOE Market Volatility Index Price Premium in Puts versus Calls Ratio The number of stock splits in the prior 30 days New Issues in the last year as a % of All stock on an index Price-to-Book Value of an index Price-to-Earnings Ratio of an index Current % Dividend Yield of an index