The Advancedecline Line

"Every day I hear about the "advance/decline" line and more times than not its negative even if the market , Credit Cards Convenience Controversy is up. How can that be?" Great question and its a bizarre situation. Let's look:

The advance/decline line is very simple, it is the difference between the number of stocks , The Most Expensive Cars To Insure moving higher on a day versus the number moving lower. So naturally if all things were equal, and the "AD" line was negative you would have to think the market , Eleven Secret Ways To Improve Your Credit And Own Your Home Before And After The Bank Says No was lower right? Absolutely, except there is a problem. All things are NOT equal!

When the NASDAQ as a whole was in a full blown bear market, , Price Targets there were about 70 or so stocks , Post Christmas Financial Difficulties that moved the index , Spam Stocks Are They Working higher on a daily basis, but overall the decliners won out almost every day. How can that be? Because of this: Stocks , Life Settlement Overview are "weighted". Okay, so what does that mean? It means some stocks , Loans Are Lenders Cheating On Aprs carry more weight as far as their impact on the index. , Whats In A Credit Report

Let's look at a tech heavyweight like MicroSoft. They are a major league "market cap" weighted stock, , The Truth About Free Credit Cards meaning they are so huge, when they make a move higher, even if they just gain a point, it will add several points to the NASDAQ. On the other hand little outfits like XYZ, have no weight. So, four no name XYZ's can fall , Simple Money Making Tips For Moms on the day if one Microsoft gains! This is why you may have been baffled, watching stock , The Truth About Free Credit Cards after stock , Retiring Or Leaving The Company How To Properly Do An Ira Rollover make a new low on the year, and yet the NASDAQ may have been up 50 points that day. But if you look at who moved higher it was the MSFT's, IBM, INTC's of the world, that are so weighted, they carried the index , Dividends The Different Types higher even though two times as many that went up, actually went down.

Most market , Will Online Mortgage Lenders Replace Traditional Banks technicians will tell you we are in a heap of trouble if the AD line is negative for too long and in a way we agree with that, but this is a different market , 12 Fundraising Product Sales Tips than just a few years ago. Fund , Insurance Brokerage Firms managers have so much power that they move the markets , The Truth About Free Credit Cards on a daily basis. When you are the manager , Will Online Mortgage Lenders Replace Traditional Banks of a billion dollar fund, , Insurance Brokerage Firms you aren't buying , Dividends The Different Types XYZ for your fund, , Simple Money Making Tips For Moms you are buying , Use Bad Credit Home Loan To Get Funds Despite Poor Credit Ratings the big names. So it's no wonder only 70+ stocks , Selecting An Online Payday Lender go higher while 1000 fall , Whats In A Credit Report on the day. So in a twisted way, the AD line is not a very clear description of the health of the market. , Loans Are Lenders Cheating On Aprs A year or so ago if you had watched the AD line you probably would not have bought stocks , Simple Money Making Tips For Moms in Oct, Nov, Dec, and January. But during that time, the NASDAQ made the biggest advances of its history. Over on the NYSE it was even worse, with the AD line in poor shape almost every day. So we cannot simply look at the AD line and come to the conclusion that the market , Debt Reduction Program Finding The Right Program For You is not going to move higher. Certainly we would enjoy seeing more of the secondary players join in any market , The Power Of Body And Mind moves, but to sit on your hands simply because the small guys are falling while the big guys are flying, won't put any money , Price Targets in your account. , Credit Cards Convenience Controversy

Don't forget folks, that until the advent of the "401K" plan, , Life Settlement Overview fund , Discount Commodity Brokers managers didn't have the power they have today. Sure an analyst could come out and upgrade or downgrade a stock, , Discover An Effective Forex Trading System but there wasn't enough big concentrated money , Use Bad Credit Home Loan To Get Funds Despite Poor Credit Ratings to make much happen because of it. But when 401K plans , Buying Silver Bullion became popular, stock , Introduction To Unit Trust funds found themselves with huge cash inflows 4 times a week, or once a month depending on the plan. , Will Online Mortgage Lenders Replace Traditional Banks That relates to literally billions of dollars for them to spend, , Has Gold Topped Out For Now so naturally they all tend to "clump together" and buy , Term Life Insurance Help the same "leaders". That is why when a stock , Credit Repair Help was hot like JDSU once was, it could go from 150 to 300, split, run back to 300 and split again like clockwork. While JDSU was doing that, what do you think XYZ was doing? Not a whole lot! So, fund , The Power Of Body And Mind managers are really one of the basic reasons the AD line can stink and yet the market , Eight Rules For Etf Success gains 100 points on the day.

For more FREE trading , Debt Reduction Program Finding The Right Program For You tips, enter your email address at:

http://lb.bcentral.com/ex/manage/subscriberprefs?customerid=12826