The first chart above this post shows the daily count of the number of issues traded on the New York Stock Exchange which advance in price (black line) and the 10 day moving average of this number (red line). I last commented on this indicator here. The second chart above this post shows the daily count of the number of issues in the S&P 500 index that are trading above their 200 day moving averages (green line).
The interesting thing about the first chart which shows the advancing issues indicator is the bullish divergence we saw at the low a couple of days ago. The averages had reached new lows for the reaction which began at the July 16 top. Yet at the same time the daily count of advancing issues and the 10 day moving average of this number both stayed above the low points they had reached earlier in the reaction. This was a useful clue that a low was forming.
The second chart also provided some evidence. Note how the count of the number of SPX issues above their 200 day moving averages fell to the levels associated with important lows previously in this bull market.
I think we shall see the 10 day moving average move up to its "overbought" levels (horizontal red line) and then form a sequence of lower tops before this rally is finally over. I doubt that this scenario can be completed until late this fall.