Education & Information

Interpreting Bullish Percent Charts

There are two levels of analysis on BP Charts.

1. Direction
2. Position

Direction

• A rising percentage is recorded with Xs
• Xs indicate demand is stronger than supply within the universe (NYSE, NASDAQ or sector)
• Our approach toward this universe is aggressive
  
• A declining percentage is recorded with Os
• Os indicate supply is stronger than demand within the universe
• Our approach toward this universe is defensive

Position

• Usually near the middle of the chart, 50%
• Extremes are 70% and 30%
• Reversals from the extreme levels indicate major turning points in direction for the universe being charted
  
• 70% is a high-risk level
• A reversal down from 70% is a major sell signal for the universe
• Manage your portfolio accordingly within this universe (risk management)
  
• 30% is a low-risk level
• A reversal up from below 30% is a major buy signal for the universe
• Manage your portfolio aggressively within this universe

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