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THE BIG IDEA
In last week’s Seen On The Internets, we showed a post that highlighted a potential bearish development on the monthly chart of the S&P 500. Fortunately, the market “changed its mind” as we described it at the time and that bearish signal is now officially waved off.
Similarly, there are now smart people anticipating the possibility of a “breadth thrust” occurring any day now.
Breadth thrusts tend to get stock market nerds excited because (1) they are relatively rare, and (2) they reliably herald a period of bullishness.
What is a breadth thrust? Well that is a Big Idea for another edition of this newsletter. For now, the important thing to know is that it involves a lot of stocks going up for a lot of days in a row. It means the market is throwing money at any stock with a pulse and nobody is selling.
How many stocks need to be going up and for how long? There are several variations of the idea out there. As far as we know, none have been triggered as of yet but could in the coming days. Here are a couple of the more popular ones:
Zweig Breadth Thrust - created by Martin Zweig and discussed in recent days by veteran analyst Tom McClellan.
Whaley Breadth Thrust - an alternative version from Doug Whaley and the one preferred by Walter Deemer, a long-time market observer and author of several books on investing (including the fantastically titled When The Time Comes To Buy, You Won’t Want To).
It is not a surprise that people like McClellan and Deemer are already thinking about what might happen in the market in the near future and not just reacting to what has already occurred. But don’t be tempted to front-run the signal before it is triggered because, well, it might not happen.
The bearish engulfing candle for the month of November that some were concerned about last week did not materialize. Anybody who sold in anticipation of it was really, really on the wrong side of the market.
Anybody who wants to be a genius and go all-in ahead of a breadth thrust signal might end up looking like a fool.
SEEN ON THE INTERNETS
Chart reading is too much “art” and not enough “science” for some people, and for good reason. The subjective nature of interpreting price movements means that two people can see the situation differently while looking at the same chart.
One person on the StockTwits website is not a fan of the “falling wedge” pattern. They (re-?) posted a panel of such patterns along with a comment that they are not often helpful, or something like that.
A falling wedge is considered bullish, because it is said to be depicting a weakening of selling pressure. There is probably some truth to that much of the time. The thing is, if you look for it, you can find a falling wedge on most charts of stocks in a downtrend.
At Swingex and The Prime Wave we rarely ever point to a falling wedge as the main reason to be interested in a stock or a market. We mostly agree with the sentiment in the original post.
NUMBERS ONLY
+ 0.12% | After getting beaten up for most of the month, the S&P 500 staged a vigorous Thanksgiving week comeback and actually finished ahead by 0.12% for November. |
0 | The day after Thanksgiving is often quiet. This year’s trading produced no new 52 week lows in any of the Dow or S&P indexes. |
+ 8.78% | Semiconductor stocks, as represented by the XSD ETF, gained 8.78% last week. And that’s without help from NVIDIA, which was down by 1.05%. |
SWINGEX INDEX
As of market close on: 28 November 2025
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Swingy says: If you have been stuffing yourself with stocks, it is time to rest and start digesting some of what you gained.
See some historical examples of the Swingex Index in action here.
WATCHER
Stocks highlighted here each week are not recommendations to buy or sell. They are provided as ideas for swing traders to follow up on with their own research.
EZPW (EZCORP): The market has been volatile in both directions, but we found a stock that has printed something close to a classic basing pattern.
Previously in 2025, EZPW gave us two cup-and-handle patterns and both resulted in a bullish run higher. Just like the textbooks say should happen.
Now we have a third cup on our hands. This one has not formed a handle yet. Sometimes they don’t and just keep going north. That could happen here, but the more likely scenario is that the stock will dither around for a few days before continuing higher.
All bets are off if the handle - if it develops - dips down too far toward the base of the cup.