Trend Signal Now: Breadth Expansion Continues

Saturday, January 25, 2025

The replay of this week's LIVE video Conference Call is available for Premium Members of ASC Research.

Click here to sign up and catch up on the replay, download the 100+ charts and review each of the new trade ideas.

Healthy Market Breadth

The deteriorating breadth crowd has been out in full force to start the year.

But I continue to see the opposite (I cheated though. I actually counted).

Here are European stocks resolving this base higher and hitting new multi-decade highs.

This is, by definition, breadth expansion:

Go one by one, country by country, all over the world, and tell me with a straight face that things are getting worse.

You can't.

Because things keep getting better. More and more stocks are breaking out to new highs, and none of them are breaking to new lows.

That's a common theme among U.S. stocks as well.

Whenever a group of stocks gets close to potentially breaking down, they come in and buy them. I discussed exactly this last week on the TCAF Podcast with Josh Brown and Michael Batnick.

This literally is the definition of healthy rotation and that's why stock market breadth has been so strong this bull market - because they don't let them weaken.

Take Healthcare for example. They had the opportunity to break down, but didn't.

It's been the opposite - they bought them up. Remember that Healthcare represents 14% of the Dow and 10% of the S&P500. It's one of the largest weightings in both of these important indexes.

We're seeing the same thing happening in Materials.

This sector doesn't have anywhere near the size of the weighting in the major indexes as Healthcare.

But what's going on here is the exact same thing. They're not letting them break down. They're buying them up instead.

The Global 100 Index just closed at new all-time highs.

So did the S&P500.

And the German DAX.

The list goes on and on.... because of the broadening participation.

Now, if you took the time to actually count how many stocks are falling and breaking down to new lows, it wouldn't take you very long at all.

And that's the point. They aren't any.

So, of course, what does that mean to us? What are we doing about it?

That's what our Premium Conference Calls are for. This week was our LIVE Mid-month Video Conference Call exclusively for Premium Members of ASC Research.

In this call, we discussed my favorite long ideas from stocks with very high short interest. We also walked through some of my favorite biotech trades that can really soar this year.

It's a bull market, and we're acting accordingly.

Click here to sign up and give this week's LIVE call a watch, download all the charts and review the details for each of the new trade ideas.

We want to identify the ideal entry for each trade, where we want to put our stops and what the target is if/when we're right.

If you're looking for idea flow as well as a consistent top/down look at markets, you can join ASC Research here RISK FREE.

See you in there.

JC Parets, CMT | Founder, All Star Charts

All Star Charts emails are a financial publication of general circulation and only offers impersonal advice, not tailored to individual needs of a specific client or group. Any comments or statements made herein do not necessarily reflect those of All Star Charts or its affiliates (collectively, "All Star Charts") and do not constitute buy or sell recommendations. Unless specifically indicated, this message is not an official confirmation of any transaction. The contents of any email communications to or from All Star Charts may be monitored or reviewed at All Star Charts's discretion. All Star Charts accepts no responsibility for any loss or damage arising in any way from the use of this transmission and any attachments; it is the responsibility of the recipient to ensure that they are virus free. If you reply to this email, please note that we are a public investor and do not want any material non-public information. We do not agree to keep confidential any information you provide and do not agree to any restrictions on our trading activity, except pursuant to a written confidentiality agreement executed by All Star Charts.

Want to change how you receive these emails? You can manage your preferences here

unsubscribe