The current correction is obviously different from the others seen in the Dow Jones’ BEV chart below.  From a BEV Zero to a 10% decline in only nine trading days.  A 10% move in a BEV plot is nothing big, but seeing one take place in only nine days is worthy of note. Then the bulls take the BEV plot back to -3.41% just eleven days later, when Mr. Bear takes the plot back down to -7.81% at the close of today.

An exciting twenty-five days to be sure; twenty-five days that can be studied in detail in the Dow Jones step-sum table below.  All in all, I get the feeling the stock market’s action is being accelerated; that we’re entering a period of market history where big things can happen in a short period of time and that’s never bullish.

Next is a chart plotting the Dow Jones with the NYSE 52Wk Highs – Lows step sum plot (Red Plot). For every day the NYSE sees more 52Wk Highs than Lows, it’s a +1; more 52Wk Lows than Highs and it’s a -1. The step sum, being a single item advance decline line, merely adds the (+/-) 1s, and that explains the red plot below.  And what does the NYSE 52Wk H-L step sum tell us?  Those times when 52Wk highs dominate the NYSE, the step sum advances taking the Dow Jones (my proxy for the general stock market) with it.  When it declines, 52Wk Lows (and Mr Bear) dominates the NYSE.

Since the March of 2016, 52Wk highs have dominated the NYSE, as seen in the rising step sum.  But beginning on January 30 (23 days ago) only seven NYSE trading sessions have seen more 52Wk Highs than Lows, something not seen in the past two years.  However, up to the end of this week, this new development in 52Wk Lows dominating the NYSE has yet to turn this step sum down in the chart below, and that is something I’m now watching very closely.

I can’t say this new development in NYSE 52Wk Highs and Lows portends a pending disaster in the market. But if one was looming ahead of us, it would begin exactly like this.

A more serious development in the market is how the Dow Jones Total Market Group’s (DJTMG) top 20 has topped and is now going down, ending the week at 50 groups within 20% of their last all-time highs.

The frequency table below for the DJTMG tells the story better than I, or the above chart can. From October to the end of January, we see the double digits in the BEV Zero (new all-time highs) and the -0.001% columns. These are DJTMG groups at or just a whisker away from a new all-time high.  Those groups in the -5% to the -15% columns were single digits.

But all that changed in Barron’s February 5, 2018 issue and in the weeks that followed (Red Box).

It takes buying to make a market go higher, but gravity alone can take a market down. What we’re looking at in the table above is the beginning of a buyer’s strike in the stock market.  The big bulls in the stock market are, and have been central banks doing their “market stability” thing, and corporations with their share buy-back programs, or maybe they were until the first of February. Looking at the table above, it’s as if someone turned a switch and something changed since the end of January.

Should this development continue, the shifting of the groups to lower levels in this frequency-distribution table, and resulting decline in the DJTMG’s top 20, it will be very bearish for the stock market.