In Friday’s On My Radar, Steve Blumenthal discusses his favorite market risk-on/risk-off indicator: the Ned Davis Research CMG U.S. Large Cap Long/Flat Index. The Index measures “market breadth,” which, generally speaking, is a measure of market activity, such as how many stocks are advancing higher in price and how many are declining, how many are making new highs and new lows, is the trading volume advancing or decreasing in size and is price momentum strong or weak by looking at the number of stocks that are in uptrends and downtrends.
The NDR/CMG process measures market breadth by analyzing the overall technical strength across 22 individually measured sub-industry sectors. The process measures the trend of each of the sub-industry sectors, evaluating the rate of change in price momentum over short-term and long-term time frames and directional trend of each sub-industry sector.
Click below to find out what this important indicator is telling us about current market breadth and whether we should be risk-on or risk-off.READ MORE