The Nasdaq looks fine but its internals tell a different story
QQQ•The Nasdaq Composite is down 4.3% from its October 6 record close, while two market-breadth measures have weakened to levels last seen around the spring 2025 bear-market bottom.
1. Breadth measures weaken
The Nasdaq Composite slipped Tuesday, leaving it 4.3% below its October 6 record close and 4.7% below its intraday high that day. The Nasdaq New High/New Low Index ended at 13.1%, its weakest reading since April 16, 2025.
2. Indicators near past lows
The Ratio-Adjusted McClellan Summation Index ended Tuesday at -1,265.9, its lowest reading since April 22, 2025. Earlier this year it diverged from the Nasdaq's June peak, and it did not confirm the Composite's October record high. Both measures are nearing levels seen around the Nasdaq's spring 2025 bear-market bottom, despite the index remaining less than 5% below its record close.
3. Divergence unresolved
The article says market leadership could continue weakening and pull the broader index lower, or participation could improve and breadth catch up. It says traders may not have to wait long to see which occurs.
