when the index is below 30 stock prices are trading near their lows and investors have a bearish market sentiment when the index is above 70 stock prices are trading near their highs and investors are bullish 
traders typically apply the indicator to a specific index such as the s p 500 or nasdaq 100 based on point and figure charts the bpi measures the number of stocks with bullish patterns neutral markets have a bullish percentage of about 50 when the bpi reads 70 or higher market sentiment is extremely optimistic which could signal that stocks are overpriced 