Breadth of Market Theory

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DEFINITION of 'Breadth of Market Theory'

A technical analysis theory that predicts the strength of the market according to the number of stocks that advance or decline in a particular trading day.

BREAKING DOWN 'Breadth of Market Theory'

The breadth of market indicator is used to gauge the number of stocks advancing and declining for the day. If the breadth indicator is strong, this theory predicts that the market will be rising and vice versa.

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RELATED FAQS
  1. How can I use market breadth to my advantage?

    Market breadth is a study that compares the number of companies on a given exchange that have created new 52-week highs to ... Read Full Answer >>
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    The common assumptions made when doing a t-test include those regarding the scale of measurement, random sampling, normality ... Read Full Answer >>
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    Since the fixed charge coverage ratio indicates the number of times a company is capable of making its fixed charge payments ... Read Full Answer >>
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    The price of an American depositary receipt (ADR) is determined by the bank or other financial institution that issues it. ... Read Full Answer >>
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