Advance/decline data, moving average breadth, and sector participation across the S&P 500.
Healthy rallies are confirmed when breadth is broad, not narrow.
Analyzing market breadth...
Join thousands of investors who start every morning with The Morning Setup — concise, actionable market insights in under 5 minutes.
For informational purposes only. The data and visualizations on this page do not constitute financial advice, investment recommendations, or an offer to buy or sell any securities. Always do your own research and consult a qualified financial advisor before making investment decisions.
Market breadth measures how many stocks are participating in a market move. A rally driven by a handful of mega-cap names looks different from one where hundreds of stocks are advancing together. Breadth indicators help distinguish between narrow, fragile rallies and broad, healthy trends by counting the number of advancing vs. declining stocks and tracking how many are above key moving averages.
The A/D ratio divides the number of advancing stocks by the number of declining stocks. A ratio above 1.0 means more stocks are rising than falling. Sustained readings above 2.0 are often interpreted as broad bullish participation. Readings below 0.5 suggest broad-based selling pressure.
This shows the percentage of S&P 500 stocks trading above their 50-day moving average. A reading above 70% indicates strong short-term breadth. A reading below 30% is often interpreted as short-term weakness and often coincides with oversold conditions.
The 200-day moving average is the standard measure of long-term trend. When more than 60% of stocks are above their 200-DMA, some analysts interpret the long-term trend as healthy. When fewer than 40% are above it, the market may be in a sustained downtrend or correction.
This measures the net number of stocks making new 52-week highs minus those making new lows. A positive reading is often associated with bullish momentum. A negative reading—especially during a rally in the major averages—is what technicians call a bearish divergence.
Breadth divergences are among the most widely followed patterns in technical analysis. If the S&P 500 makes a new high but the number of advancing stocks shrinks, breadth is deteriorating—a pattern some technicians interpret as the rally narrowing. Conversely, when breadth improves during a pullback, it is sometimes interpreted as broader participation returning and some analysts view this as a potential stabilization pattern. Many traders and analysts track breadth data to assess the internal composition of market moves.
An A/D ratio between 1.5 and 3.0 during up days is considered healthy. Extreme readings above 5.0 may indicate short-term overbought conditions. Sustained readings below 0.5 are often associated with broad selling pressure across most sectors.
A bearish divergence occurs when the index makes a new high but breadth indicators (A/D line, percentage above moving averages, new highs) fail to confirm. This means fewer stocks are driving the rally, which some technicians view as a potential vulnerability. Bullish divergences work in reverse at market lows.
Sector-level breadth shows which areas of the market are strongest or weakest. Defensive sectors with strong breadth during overall market weakness may reflect a rotation toward traditionally defensive sectors. Cyclical sectors leading breadth improvements is sometimes associated with growing confidence in economic growth.
