The stock market atmosphere can often be overwhelming and hard to understand. To help you gain a better overview of what is happening in the stock market, we will look at three charts that illustrate market breadth, bonds and sentiment.
Market Breadth
The first chart is a measure of market breadth, a tool used to measure stock market activity. Market breadth is a way of determining whether there is strength or weakness in the overall market. This chart identifies the percentage of stocks that are making new highs, as well as the percentage of stocks that are making new lows. A rising market breadth indicates that the market is gaining strength, while a declining market breadth suggests the opposite.
Bonds
The second chart looks at the bond market. Bonds play an important role in the stock market as they are indices used to measure the various currencies in which stocks are traded and health of the overall bond market. This chart tracks the 10-year U.S. Treasury yield, a benchmark across multiple sectors. This chart shows trends in rates and how they may indicate the strength of the stock market as a whole.
Sentiment
Finally, we will look at sentiment, which is a measure of investor opinion about the stock market. It is a tool used to analyze and evaluate how investors feel about a certain stock or the markets as a whole. This chart tracks monthly surveys of investors’ sentiment about the markets, which can be helpful in determining whether the market is in an improving or declining trend.
By looking through these three charts, investors can gain insight into the stock market, helping them make more informed decisions. It is important to understand what is happening in the stock market in order to be a successful investor. Analyzing market breadth, bond and sentiment charts can help make sense of the markets and reveal hidden trends that could benefit an investor.