The last post gave the bears’ case. Here is a far more optimistic view, “S&P A/D Reading Worst in Ten Years – Rebound Likely Tomorrow,” from Seeking Alpha. FYI, Birinyi is as noted a bull as Roubini is a bear. And they both could be right. Birinyi, after all, is only forecasting today’s results:
Birinyi’s Ticker Sense submits: As a follow up to our prior post, the S&P 500 A/D line got much worse, along with the performance of the index itself. For the day, just two stocks in the index closed up — RSH and STR, leaving the A/D line at -498. This ties 7/6/01 for the worst reading in the past ten years.
Below, we list the weakest S&P 500 A/D readings since 1997 and show the next day performance of the index as well. As shown, the index has gone up 73% of the time the next day for an average gain of 1.19%.