NYSE internal momentum is…starting to show signs of improving as the latest cycle bottom draws to a close. It’s worth noting that at no time in the last few weeks did the number of stocks making new 52-week lows rise above 40. This is a sign that internal selling pressure was contained during the March internal correction.
There are also preliminary signs that the number of new 52-week highs is starting to expand; on Monday the new highs rose to 144, which is the highest number we’ve seen since March 18. If this number continues to expand we’ll soon have a confirmed cycle bottom signal. The NYSE short-term directional indicator turned up today as well for the first time in weeks. Another 2-3 days of rising will also be interpreted as a bullish confirmation signal.
Finally, I would bring your attention to the dominant longer-term NYSE internal momentum indicator. This is the longest of the components of the NYSE Hi-Lo Momentum (HILMO) index, and until a week or so ago this indicator had been declining for months. The longer-term component of HILMO isn’t as important as the dominant interim indicator or the short-term directional component, yet it’s still fairly important in its own right when it’s rising on a sustained basis. The recent turnaround in this indicator is another technical sign pointing to a potentially bullish month of April.