Investing 101

_Last updated August 22 2023_

The candle breadth indicator is generated based on assessing the dispersion of intraday moves across the 1,000 largest US stocks. 

![candle breadth](https://storage.googleapis.com/toggle-webcm-prod/https://storage.googleapis.com/toggle-webcm-prod/spx_candle_breadth_91_d490479cb1/spx_candle_breadth_91_d490479cb1.png)

Using machine learning, we look at how the shift in these candle patterns, specifically the change in their statistical momentums, and how that can predict price action in the overall market. 

The indicator can be used to indicate potential market peaks and troughs. A value greater than or equal to 95 shows the high probability that we could be at a peak, versus a value less than or equal to 5 might suggest a market trough.

The indicator has worked best for bullish episodes with a short horizon (~5 trading days) and bearish episodes have shown the most success with a 12 day trading horizon. For the bullish case, we could see returns start to rise 20 days forward too. 



The candle breadth indicator is another leading indicator for the SPX generated based on assessing the intraday moves across the 1,000 largest US stocks. 

Candle Breadth

Reflexivity's Leading Indicators

_Last update August 22 2023_

We love leading indicators, and we know you love them too. Today we introduce our Trough Probability Index. The index is a probabilistic gauge of how close we could be to a trough in the broad market.

A trough is the lowest point of the index’s local trading range, and would suggest prices might be trending higher in the future. Don’t forget that markets can still trend lower, due to changes in fundamentals and in the newsflow.

![trough](https://storage.googleapis.com/toggle-webcm-prod/https://storage.googleapis.com/toggle-webcm-prod/spx_countdown_trough_probability_92_09d9cf5b5b/spx_countdown_trough_probability_92_09d9cf5b5b.png)

We have observed that when this indicator crosses 95, there’s a statistically meaningful chance that S&P has reached a trough and could rally in the short term. The index has shown to be most successful with an initial holding period of 5 trading days, followed by a longer period of 20 or more days.  

The index is built on a risk-adjusted and time-adjusted calculation of the size of the recent market moves, and the S&P historically reacts after trending downwards for a certain period of time. 



Trough Indicator

Candle Breadth