As we make a move to the upside, we will watch the breadth reading, looking for those divergences that might fore-shadow a soufflé collapse.
We have our Zweig boxed in between lower highs and a series of higher lows now.
Watching the bottom on the CVI:
At one point we had over 80% of all stocks above their 40 day moving average. Yesterday there were just 55%, so we want to watch this chart during any rally.
The NH/NL has recovered we want to stay above 70 on this one:
For the trenders, both are now owned by the bear market. The McCSI could go neutral today. We think the CUM NH/NL might need one more day to absorb that spike from last week.