This is an old school breadth indicator that I have toyed around with from time to time but not made part of my routine - until now.

10 day average of new highs in blue; new lows in red.

I reviewed data as far back as I could go - here are some guiding principles:

1. In a bull market environment, buy the time new lows cross over new highs, most damage is done. In other words, shifting bearish at these crosses is too late.

2. When new highs again exceed new lows, this is often the right time to go back to "confirmed bullish" on the rally. Let's say market has stabilized after a pullback; if new highs are exceeding new lows, no hesitation in being fully bullish.

3. When new highs gradually decline as new lows gradually increase, there can be more damage on the next drop. This happened in 2015 before the summer drop, and late 2015 before the January 2016 plunge, etc.

4. Many divergences on new highs before a real top; divergence in new lows is a helpful bottom signal. For example, 2/12/2016 significantly less new lows than 1/21 area.

Current assessment:

New lows have been rising since since late July all the way to 8/21. The cross of new lows exceeding new highs was about 8/15-16. The market is not "in the clear" until new highs exceed new lows. Should that happen, point in bulls favor.