Market Breadth Definition

What Is Market Breadth?

Market Breadth is commonly used as an indicator to show participation in a move for an index or underlying sector. By understanding how many underlying stocks are participating in a move it is easier to see why an index may be moving in a particular direction. In the case of Market Sectors , Market Breadth can be used to show breakouts and trends of similar asset types.

When someone sees that all assets in a sector are moving in the same direction this would be classified as a collective move with potentially more strength. A move of all assets to the downside would be considered a bearish trend while a move of all assets to the upside would be a bullish trend.