Knowing the Trend is key. But, knowing if the market you are trading is truly technically Bullish or Bearish is very useful.
There is a simple, FREE, way to check thanks to StockCharts.com.
It's simply the PnF (Point and Figure), BP's or Bullish Percent Indices. Located at StockCharts.com. But, it's a bit tricky to locate.
See Charting Tools in right margin. Click on "More Tools...". Click on "Market Summary". Careful here. You want to click on "End of Day", upper left. Almost there. Scroll all the way down to the bottom, until you find "Bullish Percent Indices". Eureka!
I use the BPSPX very often to confirm if the market is Bullish or Bearish. A column of X's crossing above the 30% level (Green Line) is confirming to Bullish.
Crossing above the 70% level (Red Line) is a caution zone for me, as the market is now "over baked" & may be set for a reversal.
In the Chart Header, it even indicates the Status of the market and when it began the indicated level.
Note on 2/18/2016, "Bull Confirmed" , when many are running around screaming "the sky is falling". NO Guessing here.
This is a great tool for beginning your analysis for the over all markets. Then to break down the "Hot" and "Cold" Sectors for you individual stock analysis.
"Bottom Fishing"? Look for Sectors ready to cross the 30% level in a column of X's. Keep it simple.
