The first section of Group Power reports market trends in three time frames and measures the overbought/oversold conditions of the market in each of those time frames. This isn't the old "it feels like it's gone too far, too fast to me," but a rigorous assessment of market conditions rooted in the group structure. The short-term analysis is centered on a 22-day horizon; the intermediate-term work is centered on a 12-week horizon; and our long-term perspective looks out six months.

Next, Group Power reports advances, declines, up-volume, and down-volume based on groups rather than stocks. Think of this section as a report on the basic health of the market. This data can be used to create the traditional technical market timing tools based on groups instead of stocks: the advance-decline line, net positive volume, on-balance volume, etc.

The Group Power Arms Index shows you the daily balance of the market. A reading of greater than one suggests relatively higher volume in the declining groups, while a reading of less than one suggests relatively higher volume in the advancing groups. Over time this series averages near .9 due to the upside bias of the market. If the advance-decline and up-down volume numbers are the basic data on the health of the market, then our Arms index is akin to a thermometer. We also present a 10-day open Arms Index. This is a smoothed version that is useful as a timing tool; large values mark bottoms and small values denote tops.

Group Power Arms Index = (Advance/Up Volume) / (Decline/Down Volume)
10-day open Arms Index = (10-day average Advance/10-day average Up Volume) / (10-day average Decline/10-day average Down Volume)

Another broad market perspective is provided by the percent of groups over their averages. 10, 50 and 200-day averages are used. The concept was introduced many years ago by Abe Cohen of Investors Intelligence fame for stocks and has been relied upon since by savvy traders. Group Power applies this concept to its proprietary industry group structure to generate these data series, which can be found nowhere else. Downturns in these numbers after sustained advances and upturns after sustained declines often mark changes in trend. When these series are at extremes (over 90, under 10) they are exceptionally good indicators of the overbought/oversold condition of the market for their timeframes.

The High-Low Index comes from ChartCraft, the point and figure people. The index is the number of groups making new highs as percent of all groups. Downturns from high levels are considered bearish and upturns from low levels are considered bullish.

The High Low Index Logic was created by Norman Fosback. It is based on two figures, the percent of groups making new highs and the percent of groups making new lows. The Index is the lesser of those two numbers. The idea is that when significant numbers of groups simultaneously make new highs and new lows the market is "out of gear" and vulnerable to a trend change. Values above 5% are significant.

Next is a unique and important feature. The number of new highs and lows for groups are reported for all groups in three different time frames: a year, six months and a quarter. These numbers can be very useful for market timing. For example, an expansion of 13-week new lows after an advance can mean trouble - especially when confirmed by a reversal in trend indicators. New highs and lows are summarized here; lists of Early Warnings and of 52-week new highs and lows are provided next. Given the persistence of trends in the group structure, the new highs/new lows lists can be of great use to momentum players and trend followers.

Taken as a whole, Group Power's broad market statistics provide superb data for your market timing decisions. Many timing tools can be derived from the group structure, including an advance-decline oscillator or a ten-day Arms Index. You'll find that Group Power's broad market statistics are invaluable sources of information for your market analysis.