Another day of chop. Another day of weak breadth relative to the major market indexes. If you're thinking you've heard me say this before, it's because you have.
I said the same back in late April. I said it for nearly three weeks back then. I said the same thing in the latter part of July. That time it was only a little more than two weeks. We are only one week into this, so you might have to get used to hearing these complaints.
Remember, not long ago I spent days -- weeks? -- praising how great the breadth was. I showed how it made a higher high in September while the S&P 500 languished below the July high. In October, it was the first indicator to make a new high. It led the way.
In the last week, it has been red for five of the last six trading days. Now, I grant you, it's not as though it has been that weak each day, but you have to admit something changed a week ago. That's when breadth stopped keeping pace. And now there is a clear divergence. The divergence alone is not the issue, it's what it has done to other indicators that derive their input from breadth.

For example the McClellan Summation Index has rolled over. It tells us what the majority of stocks are doing, so in this case the majority of stocks are either churning or heading down over the last week. In mid-April, it turned down and never went back up when the S&P did. The same thing occurred in July. In September it actually rolled over concurrent with the indexes, so there was no divergence as there is now.

If it wants to improve and get back on track then we will need to see the net breadth on the New York Stock Exchange add positive 1,200 advancers minus decliners. The last time we saw a day like that was on Nov. 1 when the employment numbers came out. The S&P 500 was up 30 points that day, just to put this in perspective.
Then there are the number of stocks making new lows. Nasdaq's new lows now number 107. That's an awful lot of new lows for a market at all-time highs. Only now, the NYSE has joined in. Tuesday saw 71 new lows for the NYSE. This is the highest reading for both these exchanges since the October lows. It is generally not a good sign when new lows are rising and the indexes are at their highs. This is not a one-day situation, either, since the 10-day moving average of both the NYSE and Nasdaq are now rising.


But for now, we have a choppy market that has too many divergences for my taste.