The chart below measures the percentage of high relative strength stocks that are trading above their 50-day moving average (universe of mid and large cap stocks.) As of 5/25/10.
The 10-day moving average of this indicator is 34% and the one-day reading is 14%. Just one month ago, this diffusion index was in the high 90′s. It has been a rapid move to oversold conditions. Dips in this indicator have often provided good opportunities to add to relative strength strategies.
