Where Have All the Leadership Stocks Gone?

By: Marty Chenard | Fri, Aug 26, 2011
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They are called Leadership Stocks for a reason. They lead the market up, and they lead it down.

Leadership stocks are those select group of stocks that are growing fast, everyone likes, are bought by Institutions and determine the direction and velocity of the market.

An interesting thing happens when you measure the Ratio of Leadership stocks to the Broad market stocks. A clear pattern develops showing when Leadership stocks are in retreat or expanding and outpacing the broad market.

When they are expanding in numbers and in positive territory, then the market is pulled up by the action of the Leaders. However, when they are contracting, then the market is dragged down by their retreating.

In today's chart, you can see the Leadership to Broad market ratios going back to the beginning of 2010. If you follow the vertical lines, you can see how the market's ups and downs track with what the Leadership Stock Ratio is doing.

Right now, the Leadership Stock Ratio is negative and down ... in fact, our Leadership Stock Ratio went negative on July 27th, and has remained negative since that time.

(FYI Note: The Leadership Stock Ratio chart is updated on our Standard subscription site every day and can be found on Section 4, Chart 2. This chart is presented as a courtesy to our free members today.) Do you have a friend or fellow investor that you think would appreciate receiving a link to this page of Today's Analysis"? If so, simply click on the link below to quickly and easily forward an email link. It is completely private, so we won't even know if you send one.

Ratio of Leader Stocks to the Broad Market Stocks

 


 

Marty Chenard

Author: Marty Chenard

Marty Chenard
StockTiming.com
Asheville, NC 28805
Tel: 828-296-1200

Marty Chenard is an Advanced Stock Market Technical Analyst that has developed his own proprietary analytical tools and stock market models. As a result, he was out of the market two weeks before the 1987 Crash in the most recent Bear Market he faxed his Members in March 2000 telling them all to SELL. He is an advanced technical analyst and not an investment advisor, nor a securities broker.

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