Net new 52-week highs firm up on S&P 500

One of our favorite breadth indicators — net new 52-week highs — has firmed up on the S&P 500 (SPX), and that’s a healthy sign for the market.

The next hurdle is to see this indicator push above the September and July peaks in the 41–48 range. That would confirm that the rally from the April low still has legs. For perspective, net new highs were much stronger in 2024, when they climbed above 100 net new highs — a level that marked broad and powerful participation in the market’s advance.

Net new 52-week lows did not break support

Prior to this improvement, net new 52-week lows held important support in the –10 to –21 zone, which marks the mid October and early August troughs.

If this zone were to break, it would be a warning sign of the market crumbling under the surface — but so far, that’s not the case.

10-Day Moving Average of Highs vs. Lows Turns Up

Another encouraging sign comes from the 10-day moving average (DMA) of the spread between new highs and new lows. It moved above zero in early May, flashing a bullish signal — so much for the old saying “Sell in May and go away.”

The spread briefly dipped to –0.7 on November 10, but it quickly recovered. As long as this reading stays above the zero area, the message from this important breadth indicator remains constructive for the market.

Chart 1: S&P 500 (top) and the spread between new 52-week highs and new 52-week lows