Non-confirmations by the NYSE Advance-Decline Line of new market highs have often signaled major trouble for stocks – will it be the case this ...ReadfullarticleNovember29,2016,6:41AMNon-confirmationsbytheNYSEAdvance-DeclineLineofnewmarkethighshaveoftensignaledmajortroubleforstocks–willitbethecasethistime?Insomeways,thepost-election“TrumpRally”hasbeenamongthemostexplosivestockmarketburstsofalltime.Dependingonthemarketsectororstyle,somebounceshavebeenmultiplestandarddeviationsbeyondanythingwe’veseeninyears.Thishasleftus,naturally,withmanyattractive-lookingchartsofstocks,indices,etc.,hittingnewhighs.Butaswithanyrally,thisoneisn’t“perfect”fromatechnicalperspective.Andamongtheimperfectionsisapotentiallysignificantone:thelack,asofyet,ofanewhighintheNYSEAdvance-DeclineLine.Ifyou’llrecall,theAdvance-DeclineLine,orA-DLine,isacumulativerunningtallyofNYSEAdvancingIssuesminusDecliningIssuesonadailybasis.Now,regardingthenon-confirmation,or“divergence”,thereareplentyofreasonablecaveatswhichwewilltouchonbelow.Firstoff,however,whyaresuchdivergencespotentiallysignificant?Generallyspeaking,aswearebigproponentsofstrongmarketbreadthwithinarally,weliketoseetheA-DLinegoingtonewhighsalongwiththeindices.Thatsuggeststhatthereisstrongparticipationamongstocksinbolsteringtherally.Fromatechnicalperspective,anon-confirmationbytheA-DLinehashistoricallybeenasignificantwarningforstocks–attimes.Specifically,aswehavementionedbefore,everycyclicaltopintheS&P500inthelast50yearshasbeenaccompaniedbyadivergenceintheA-DLine.Nowforthecaveats:EveryA-DLinedivergenceisn’tnecessarilyacyclicalmarkettop.Indeed,onMay21,2015,wenotedthepresenceofanon-confirmationoftheS&P500newhighbytheNYSEA-DLine.Now,thatdatedidendupmarkingthehighintheIndexforthenext13months(includinga-15%drawdown).However,withtheS&P500goingtonewhighsthisJuly,itnegatedthepotentialMay2015top(although,someindices,suchastheValueLineGeometricCompositeandtheNYSECompositehaveyettosurpasstheirrespective2015highs).Furthermore,divergencesdonotnecessarilyhave