The Bullish Percent Index - $BPSPX

The Bullish Percent Index (BPI) is a popular market breadth indicator that is calculated by dividing the number of stocks in a given group that are currently trading with Point and Figure buy signals, by the total number of stocks in that group. Bullish Percent levels that are above 70% are considered overbought, whereas levels below 30% are considered oversold. Strong buy signals occur when the Bullish Percent Index falls below 30% and then reverses up by at least 6%. Conversely, promising sell signals occur when it goes above 70%, and then reverses down by at least 6%. For more information see here. I would not take the current signal as a buy signal as it appears to me that the market is in a 4th wave down pattern and has more to go on the down side. Below is a 2 month daily chart of the $BPSPX which shows a low of 13.60 (meaning only 13.6%of the S&P500 stocks had buy signals) on Jan. 22 and bouncing up to 38% by Feb. 1. And while the market did go higher during that period the momentum still appears to me to be to the down side. However, strictly speaking, this is a buy signal!