From Taki Tsaklanos: March is right around the corner and many investors are wondering how stock markets can continue to rise in 2017.
At InvestingHaven, we have forecasted that stock markets would certainly not crash in 2017, and, so far, that call was spot-on. Our stock market outlook for 2017 was made at a time when the U.S. stock indexes were trading more than 10 pct lower than today’s level.
We cover extensively price charts and intermarket dynamics. In this article we focus more on market internals, aka stock market breadth. Stock market breadth is simply another indicator which confirms or diverges from price patterns.
The below chart shows the stock market breadth for the NYSE, Nasdaq and AMEX over the last 200 days. Three types of market internals are featured: advance minus decline issue, advance minus decline volume, high minus low issues.
Visibly, stock market breadth looks very strong, especially since November:
We believe that the NYSE is one of the more important indexes. Also, volume is strong in the uptrend. Those factors outweigh the somehow weaker advance minus decline issues of the AMEX.
All in all, we believe the stock market breadth looks great, and confirms the all-time highs in stock markets. Although a retracement will take place, it seems clear that the first part of 2017 is bullish for stocks, fully in line with our previous 2017 market forecasts.
The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) was unchanged in premarket trading Tuesday. Year-to-date, DIA has gained 5.46%, versus a 6.08% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of Investing Haven.