Maybe, however, low volatility conditions lead traders to want to catch breakouts and thus act on fear. When we make new highs or lows, they're afraid of missing the (finally!!) big move. It's the same fear of a big move that leads those traders to exit long positions on weakness and short positions on strength.

With one trader I coached a while back, we took at look at what his P/L would have looked like had he added a unit of risk every time he stopped out of a trade. Sure enough, he would have been very profitable. His ideas were fine. But he managed his positions on fear, not opportunity.

As a little demonstration, I went back to the start of 2015 and constructed a measure of relative breadth. I created an index of the percentage of SPX shares trading above their three and five-day moving averages (raw data from the excellent Index Indicators site). I compared the index value to its average value over a lookback period and expressed the result in standard deviation units. Thus, I could see when short-term breadth was significantly strong or weak in relative terms.