MDA - Market Direction Analysis Message Board

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Strategies & Market Trends : MDA - Market Direction Analysis

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To: Gary Wisdom who wrote (25508)	9/10/1999 6:26:00 PM
From: John T.	Read Replies (2) of 99985

Interesting comments about market breadth. Here's something from DecisionPoint that I keep reading to myself over and over: The Advance-Decline Line is the most cited and least understood of all market indicators. ... So, while breadth deterioration as expressed by the A-D Line commonly does accompany major tops, its presence alone is not adequate evidence to conclude that a decline may be at hand. ... Because the A-D Line cannot express the amount of price movement, it is unreasonable to expect it to always confirm new price highs, which is how it is usually, and incorrectly, interpreted. Negative divergences over large spans of time are extremely common, are usually meaningless, and should be ignored. decisionpoint.com

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