The New Highs/Lows Cumulative(NHNLCum) indicator is a long-term market momentum indicator. It is a cumulative total of the difference between the number of stocks reaching new 52-week highs and the number of stocks reaching new 52-week lows.
The NHNLCum provides a confirmation of the current trend. Most of the time, the indicator will move in the same direction as major market indices. However, when the indicator and market move in opposite directions, it is likely that the market will reverse.
The interpretation of the New Highs/Lows Cumulative indicator is similar to the Advance/Decline Line in that divergences occur when the indicator fails to confirm the market index's high or low. Divergences during an up-trending market indicate potential weakness, while divergences in a down-trending market indicate potential strength.
Calculation:
NewHighs = The number of stocks reaching new 52-week highs
NewLows = The number of stocks reaching new 52-week lows
PrevNHNLCum =The previous value of the indicator
Inputs:
Group = XU100
Indicates the portfolio, group or index.
Indicator Type: Market Breadth