Subtle Internal Weakness

At the lowest point of the December 2018 decline in the stock market, just 13% of the 3,000+ stocks on the NYSE traded above their long-term 200-day moving average. The recovery in the intervening months has been relentless; straight up without pause. Today, a much healthier 72% of NYSE stocks now trade above their 200DMA, a significant improvement. However, with each rally over the last 12 months, fewer stocks have been participating in the market advance.

Prior to the sharp correction in January 2018, 92% of NYSE stocks were trading above the 200DMA. The stock market plunged in February but then recovered, making a new high later in the year. However, just 82% of stocks traded above the 200DMA at the September 2018 peak. Then the Q4 2018 decline took stocks to a lower low and now we are experiencing the latest recovery. This time, just 72% of NYSE stocks are trading above the 200DMA. This is a subtle deterioration that is taking place out of sight of many market participants. We could break higher in the next few weeks and the bulls will be vindicated. I think we need to at least re-test the December lows before a more meaningful rally can commence.


At Secure Investments, I advise individual clients on their pension and non-pension fund investment portfolios. To learn more about my Active Asset Allocator and Gold Trader  investment strategies, please get in touch at or 086 821 5911. If you are reading this via LinkedIn, why not visit Secure Investments and subscribe to get exclusive content for free. No spam, ever. Just great stuff.


The information contained herein should not be taken as an offer of investment advice or encourage the purchase or sale of of any particular security or investment. It is provided for information purposes only. Secure Investments and its content providers makes no representation or warranty of any kind with respect to the services described, analysis or information obtained arising from use of the pages on this website. Information provided is obtained from sources deemed to be reliable and is provided solely on a best efforts basis. Secure Investments and its content providers do not guarantee the completeness or accuracy of such information and do not accept any liability for any loss or damage arising out of negligence or otherwise as a result of use or reliance on this information, whether authorised or not. The use of the website is at the user's sole risk. Not all recommendations are necessarily suitable for all investors and investment policy must be tailored to suit the circumstances of the individual. We recommend that readers consult their professional adviser before acting on any advice or recommendation on this website. The value of any investment may fall as well as rise and you may not recover the full amount originally invested. Past performance or simulated performance is no guarantee of future investment returns. The value of your investment may be subject to exchange rate fluctuations which may have a positive or adverse effect on the price or income or the securities.