Chart of the Day - Wednesday, January 29th, 2020

Today’s Chart of the Day was shared on Twitter by Drew Wells (@DrewTheCharts). It's a daily candlestick chart of the Russell 1000 index ($RUI) over the past 4.5 years. The indicator at the bottom shows the percentage of stocks within the Russell 1000 that are trading above their respective 200-day moving averages. From fears of World War III to the coronavirus, there have been some intimidating headlines over the past few weeks. While some insist that these events will be the end of the bull market, Drew explains that there's no reason for investors to panic as long as the percentage of stocks above their 200-day moving average stays above the 45-50% level. Things tend to get ugly for the Russell 1000 when that indicator falls below that level. He adds: "The market can correct a lot more than 3% with the long term trend still intact." This chart serves as an excellent example of how charts allow you to tune out the noise and focus on what really matters, which is price.