October 24, 2013 at 09:38 AM EDT
How To Spot A Fading Stock Market Rally
INDEXDJX:.DJI, INDEXSP:.INX, NYSEARCA:SPY, NYSEARCA:DIA, DJI:DJI, CBOE:SPX, NQ:COMP, NY:XAX Related posts: Stock Market Doomsday Scenarios Are Fading Away S&P 500: U.S. Stock Market Foreshadows Another Rally How The Stock Market Staged A Rally and Not a Meltdown This May Here’s Why The Fed’s Stimulus and Stock Market Rally May Continue How Long Can This Stock Market Rally Last?

bearbull21Geoff Garbacz: Last week we reviewed the state of the equity market through the advance/decline lines. At that time, the daily advance/decline lines looked strong and now the weekly advance/decline lines have improved as well.

If there is trouble ahead, it isn’t visible in this statistic.

Click to view the image full-size

The S&P 500 (INDEXSP:.INX) bottomed on Oct. 9 at 1,646.47. By the Oct. 23 close it had rallied to 1,746.38. This 100-point swing in less than two weeks was this year’s sixth strong rally.

A pullback followed each rally.

 

The average move has been 6.92%. The median move is 6.89%. The current rally is 5.43% so far. There could be some more upside, but how will we know if the end is near?

The honest answer is that we won’t know until after the peak is in. The only thing we can do is watch our indicators to see when the rally is long in the tooth. They can help us see whether the run is near its end or whether an outsized move to the upside is in the offing.

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Related posts:

  1. Stock Market Doomsday Scenarios Are Fading Away
  2. S&P 500: U.S. Stock Market Foreshadows Another Rally
  3. How The Stock Market Staged A Rally and Not a Meltdown This May
  4. Here’s Why The Fed’s Stimulus and Stock Market Rally May Continue
  5. How Long Can This Stock Market Rally Last?

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