FTD Arrives on Moderate Breadth

In the 8/24/11 blog I looked at the impact of breadth on Follow Through Days (FTD). To compare breadth across market regimes, instead of using absolute breadth readings I use relative breadth readings. The study below uses the 1-yr Up Issues % Rank. This reading compares breadth versus all other days for the last year.  Despite the strong price action, Tuesday only ranked in the 84th percentile breadth-wise.  All stats are updated.

As you can see, there is no discernible short-term impact from the FTD. The stat at the bottom is interesting, and suggests the bears may even have a slight intermediate-term edge when FTDs don’t include strong breadth participation. And for those that may be curious, the success rate rises to 52% when breadth comes in above the 95th percentile.