In technical analysis, the total of stocks increasing on a trading day less the number of stocks declining on the same day. Technical analysts use the spread as an indicator of market breadth. A positive spread indicates that a trend is or will soon become bullish, while a negative spread shows a bearish trend.
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A cumulative total of the daily number of stock issues advancing in price minus the daily number of stock issues declining in price. Technical analysts use the advance-decline index as a measure of breadth of market in order to determine the strength of market movements. Movement of the advance-decline index in the same direction as the market confirms the market movement and indicates the movement will continue.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.