The buyers in the stock market are much more aggressive Friday than sellers were during the market's tumble earlier this week. The NYSE Arms Index, which is a volume-weighted measure of breadth, fell to 0.523. The Arms is used by many to gauge the intensity of buyers and sellers. When buyers are more aggressive, the Arms tends to fall below the equilibrium level of 1.000, as volume in rising stocks rises in proportion to volume in declining stocks. Many chart watchers believe a decline in the Arms to below 0.500 suggests panic buying, while a rise above 2.000 indicates panic selling. On Wednesday, when the Dow Jones Industrial Average plunged 373 points, the Arms edged up to just 1.21 on the NYSE, suggesting sellers were relatively calm and collected. Meanwhile, current Arms readings suggests buyers are behaving like they are panicking, but aggressively rushing into advancing stocks. About 77% of NYSE were trading higher, but the volume in advancing stocks represented about 88% of total volume. On the Nasdaq, 61% of the stocks were rising, while advancing volume was 77% of the total. The Dow rallied 163 points in midday trade.
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