Time or Price
Dan Russo, CMT
February 23, 2026
There are two ways a market can correct, and they’re listed in the title of this week’s note. I wish I had something more interesting to say, I really do, but we have to take what the market gives us.
Right now, all we have is a sideways consolidation, or a correction through time. Bulls will argue that the market is healthy based on breadth. Bears will argue that the market is too concentrated and therefore vulnerable. Both camps are technically correct. We won’t know which argument wins until the current consolidation resolves.
S&P 500 and NASDAQ 100
At the risk of sounding like a broken record, both indices remain in consolidations above their rising 60 week moving averages. Both have been correcting through time for nearly four months now.
This remains constructive—until proven otherwise.
Source: Optuma
NYSE Advance/Decline Line
Breadth bulls can, and should, point to the NYSE Advance/Decline Line breaking out to new highs above its rising 43-week moving average. A lot of stocks are going up, and that matters. That’s bullish.
Source: Optuma
NYSE New Highs and New Lows
Here’s where nuance comes in. New highs on the NYSE remain healthy, which is bullish. At the same time, we’ve noted an uptick in new lows, which is not.
The fact that both new highs and new lows are elevated is worth noting. Some will argue that this is not what you typically see in a healthy market. For now, we’ll file this under interesting, but not yet actionable.
Source: Optuma
Final Thoughts
The market continues to work off excess not by falling, but by going nowhere.
Price hasn’t broken, breadth remains supportive, and long-term trends are still intact.
Only the market can decide how this consolidation will resolve. Until that decision is made, discipline matters more than conviction.
We’ll follow the evidence. As always.
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