Same Breadth Divergence Like in February 2012

Fewer stocks are participating in the rally: the "S&P 500 Percent of Stocks Above the 50 Day Moving Average" indicator is declining from a very high level. We saw the same pattern last year before the S&P 500 lost 2 percent, which is of course just a minor pullback and no concern to longer term investors. The swing trader, however, should be careful in initiating new long positions at this point:

Short-term breadth divergence could lead to minor pullback soon