As you can see the McClellan timer chart is a good chart to spot divergences. The chart below is showing us that the Nasdaq has been in a nice upwards channel since the very beginning of 2013. We have not busted out of this channel on the up side or the down side.
The most important thing on this chart is that the NAMO market breadth has been declining for the last few months, while the price has been increasing slowly and steadily.
The NAMO is still in positive territory and that is a good thing for the bulls, and due to the face we are still in that upwards channel drawn below, that is also favoring the bulls.
The worrying thing here is that rising price, and falling NAMO is not bullish typically.
This chart is now telling us that the 3150 or around this level is very significant.
|McClellan Timer chart|
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