Market breadth counts how many stocks in an index take part in its move. When the index and the count agree, the move is broad. When they disagree, it rests on fewer stocks than the headline suggests.
Why is the index level not enough?
Most indices weight members by company size, so a few large companies can carry the index. Take 50 stocks where the 5 largest carry 40% of the weight. Those 5 rise 3%; the other 45 slip 0.5%. The index still gains about 0.9%, yet 45 of its 50 stocks fell.
Narrow rallies can run for a long time. But you only see how narrow a move is by counting.
Which breadth measures matter?
- Advancers and decliners: how many members are up and down since the previous close. 40 up and 10 down in an index of 50 is a broad day.
- Share above a moving average: the share of members above their 20-, 50- and 200-day averages. That is how many are in a short-, medium- and long-term uptrend.
- Bullish Percent Index (BPI): the share of members on a point-and-figure buy signal. The BPI guide explains it.
- New highs and new lows: how many members reached a new 52-week high or low.
How do you read breadth for an index?
Check that breadth confirms the index. A new index high with most members above their 50-day average is broad. A new high with fewer members joining each time is a narrowing advance.
Illustrative: the index (top) makes higher highs while the share of members above their 50-day average (bottom) makes lower highs. Fewer stocks are carrying the move.
Watch the extremes. At 70 or higher, most members share the same uptrend. At 30 or lower, very few do. Extremes say a trend is widespread or a sell-off is deep, not when either will turn.
Use the 3 time frames together. A high 200-day share with a falling 20-day share is a pullback inside a long uptrend. A low 200-day share with a rising 20-day share is a bounce inside a long downtrend.
Compare indices. Breadth for a large-company index can be strong while breadth for a small-company index is weak. Side by side, they show where participation is spreading.
What can breadth not tell you?
- Every stock counts the same, so a weak count can sit beside strength in the largest companies.
- Small indices swing hard: in a 30-stock index, each member is worth more than 3 points.
- Divergences can last for months. Breadth is not a timing signal.
- Gaps in data change the count. A stock with no price for the session is left out of that day’s figures.
How does Chart in Motion show breadth?
The Market breadth board shows one row per index, for India or the US (a switch picks the country):
- Adv and Dec: members up and down since the previous close.
- 20-day, 50-day and 200-day: the share of members whose latest price is above that exponential moving average (EMA), which weights recent prices more.
- BPI: the share of members on a point-and-figure buy signal.
- Highs and Lows: members whose day’s high reached or passed their highest high of the previous 252 trading days (about a year), and the same for lows.
The board is rebuilt every hour, so it moves during the session. Readings of 70 or higher show in green and 30 or lower in red; the colours mark extremes, not instructions. On a phone, Adv and Dec share a column, as do Highs and Lows.
See it in the app
Breadth sits one click from the chart, so you can check whether a stock’s move matches its index. More on the features page.