What Market Breadth Measures
A market can be up on its headline index while only a handful of large-cap stocks drive the gain. Market breadth cuts through that by counting how many individual stocks are advancing versus declining. Strong breadth means the rally is broad and sustained. Weak breadth on an up day means the index is masking underlying weakness across most of the market.
Reading the Advance/Decline Ratio
The advance/decline ratio shows the number of CSE stocks that closed higher versus those that closed lower on the day. A ratio above 2:1 (twice as many advances as declines) indicates strong broad market participation. A ratio below 1:1 on a day when the ASPI is up suggests the index gain is being driven by a few heavyweight stocks.
Up Volume vs Down Volume
Investography's breadth panel also shows total volume traded in advancing stocks versus total volume in declining stocks. A session where advancing stocks capture 70 percent or more of total volume is a high-conviction bullish day. When declining stocks capture the majority of volume even if their count is lower, selling pressure is more intense than the advance/decline count alone suggests.
52-Week Highs and Lows Count
Check breadth data before making any new entry. If you are entering a position on a day where the ASPI is up but breadth is poor (more decliners than advancers, volume concentrated in falling stocks), you are buying into a weaker underlying environment than the headline index suggests.