Advance Versus Decline Information

[mongoose]

The number of advances and declines on any given day are available through a number of sources. I use Bullcharts for the actual numbers however could any one please advise if there are charts that display the movement or ratio.

One can do it manually but would prefer to not be trying to reinvent the wheel.

Thanks in advance

 

[tech/a]

Goose.

Just data or Premium data can supply charts of A/D.

 

[mongoose]

tech/a

Thanks for responding. I use Premium Data for Ami Broker, Bullcharts and Bullseye Broker however to the best of my limited knowledge AB,BC and BE do not chart the actual AD numbers. They have indicators related to advance decline on an SP but not advance decline totals. Maybe the answer is so obvious I cannoy see it.

The main reason I am interested is that Weinstein in one of his books refers to this as a very useful indicator as a precursor to a market swing.

 

[tech/a]

Yes your right.

Have a chat with Richard Dale.
Jose has the numbers I believe on his Pegesus site.

 

[Uncle Festivus]

Tech, do you have a web address for Pegasus?

 

[tech/a]

http://www.metastocktools.com/index.html

This is Jose's site

Google Roy's Metastock tips and tricks site as well.
Very handy for M/S users.

 

[CanOz]

tech/a

Thanks for responding. I use Premium Data for Ami Broker, Bullcharts and Bullseye Broker however to the best of my limited knowledge AB,BC and BE do not chart the actual AD numbers. They have indicators related to advance decline on an SP but not advance decline totals. Maybe the answer is so obvious I cannoy see it.

The main reason I am interested is that Weinstein in one of his books refers to this as a very useful indicator as a precursor to a market swing.

Interesting you brought this up now....check out today's AFR under 'what the charts say' (towards the end of the market wrap section).

He has a chart of the XJO with an a/d line as well...not sure i'm convinced by that alone, but interesting timing anyway.

Cheers,

 

[motorway]

Figure 65 The long term inflation-adjusted chart of the NASDAQ Composite between 1973 and 2000, illustrated with its Advance/Decline line. It is remarkable that the Advance/Decline line of NASDAQ was continually trending down even during the phenomenal Bull Market between 1980 and 2000. In other words, MOST new stocks ultimately become mediocre and fall way behind the Market Averages. This is because the Market Averages are always dominated by the new leaders which have very high Relative Strength.

Can not post the chart.. But it is from the material in the relative strength thread..

Every bull market has a theme behind it....
The first to establish or leverage on the theme
Get early strength and as the bull market progresses
The market breath gets narrower and narrower

At a certain point it gets too narrow and maybe an end..

BUT a falling A/D is maybe healthy
When it starts rising... It might signal an attempt at rotation
and at the top that might mean there is no real value to be found


A/D did signal the end of the NASDAQ eventually but it had negative divergence for the entire period from 1980.

MOST (new) stocks ultimately become mediocre and fall way behind the Market Averages. This is because the Market Averages are always dominated by the (new) leaders which have very high Relative Strength.

I think Colin Nicholson might have some files on His site

motorway

 

[motorway]

The main reason I am interested is that Weinstein in one of his books refers to this as a very useful indicator as a precursor to a market swing.

Great breadth of the market is a sign that the movement under way will shortly culminate....Artificial support turned the market upward and
several rallying days followed...Note how the market narrowed as
prices recovered. This shows a decreasing demand at higher levels.
People with money were willing to buy at higher levels, but they would
not bid prices up.

Some market students consider the breadth of the market a more
reliable indicator than its volume....the volume may be heavy even in
a narrow market, because the totals are padded by the operations of
large interests and floor traders who generally work in the leading
stocks.

A broad market generally means wide participation in the dealings by
all sorts of people. It is therefore more genuine than a market of
large volume. Each additional stock recorded in the day's dealings
will interest its own circle of followers all over the country and
cause many of them to buy or sell.

The practical side of this question readily suggests itself to those
who are endeavoring to master the market's intricacies. Study of
breadth and narrowness in not widely different from a study of
volumes. Each stock dealt in forms a unit of participation;
collectively they are a means of measuring the extent of outside
interest. Put in graphic form the eye readily grasps the relative
breadth at certain stages. Each individual must decide for himself
whether he can extract sufficient value from these indications to
warrant his permanent adoption of the idea.

Richard d Wyckoff - Fourteen Methods of Operating in the Stock Market
1909

motorway

 

[motorway]

been trialling some software

here is a line

different to Colin's ?

motorway

 

[mongoose]

Thanks for all the information I will check it all out.

What Stan Weinstein said was PP 276/277 Secrets of Trading in a Bull and Bear Market 1988 was.

"As long as the advance - decline line and the DJI are moving highly in gear with each other, theres nothing to worry about: its very unlikely that the market will experience even a significant correction. However when this indicator starts to lose upside momentum as the DJI continues to charge higher, thats a negative divergence signaling market trouble ahead. If the divergence takes place over a shirt period of time (several weeks), the decline is likely to turn out to be a correction within an ongoing bull market. If, however the negative divergence continues to take shape over a long period of time (several months). thats a problem. On top of all this. if the DJI and the A-D lines break down from important top formations a new bear market is ready to descend on Wall Street. This clear cut signal has worked time and again throughout market history. You are much more likely to see the A-D line reach its peak before the DJI because as confidence wanes, money moves out of the secondary stocks and into the higher quality blue chips. Historically the the NYSE advance decline line reaches its ultimate peak five to ten months before the blue chips top out. Once the A-D line stops rising, start becoming more and more suspicious about how much longer the bull will be able to stay alive"

 

[motorway]

tech/a

Thanks for responding. I use Premium Data for Ami Broker, Bullcharts and Bullseye Broker however to the best of my limited knowledge AB,BC and BE do not chart the actual AD numbers. They have indicators related to advance decline on an SP but not advance decline totals. Maybe the answer is so obvious I cannoy see it.

The main reason I am interested is that Weinstein in one of his books refers to this as a very useful indicator as a precursor to a market swing.

Do you use bullish % charts with Bull's eye ?

There are a number of different breath indicators
some well known and some less..

I think you need to be careful making mechanical triggers of a simplistic nature...

apparently many were calling the end of the NASDAQ bull market
based on the divergence of A/D for years too early..

With such indicators ( and it isn't a bad one because it is not optimised )

There is convergence and divergence
but also harmonious and inharmonious action..

It all raises a red or green flag
but has to be put in context with other price volume indications

else I guess like some with the NASDAQ We sell out way to soon..

P&F bullish %
has a reputed good reputation as a market breath indicator

These ideas are very old has the quote from Wyckoff reveals..

cheers
motorway

 

[mongoose]

Do you use bullish % charts with Bull's eye ?

There are a number of different breath indicators
some well known and some less..



cheers
motorway

I do not use use Bullish % too much in BE. I mainly use BE as a very clear picture of raw price action, support and resistance.

I do find that the Bullish Triangle Pattern Recogniser a useful tool from time to time. A lot of other programs support P & F but IMO not with the clarity or ease of use with configuration.

Regards

Mongoose