Today's number is... 70

We had a breadth thrust trigger: The Triple 70 Thrust.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel is the S&P 500 index price.
• The black line in the bottom panel shows the Triple 70 Thrust indicator.
• The red line in the bottom panel is the trigger level for a breadth thrust.
• The gray shading highlights when a breadth thrust has been reached.

The Takeaway: Yesterday, one of my favorite breadth thrusts triggered: The Zweig Breadth Thrust, which Alfonso wrote about...

Today's number is... 2022

The percentage of stocks in the S&P 500, S&P 400, and S&P 600 with their 50-day moving average above their 200-day moving average have declined to levels not seen since the 2022 market downturn.

Here’s the chart:

Let's break down what the chart shows:

• The black line in the top panel shows the price of the S&P 500 index.
• The blue line in the bottom panel represents the percentage of S&P 500 stocks with a 50-day moving average greater than their 200-day moving average.
• The gray line in the bottom panel represents the percentage of S&P 400 stocks with a 50-day moving average greater than their 200-day moving average.
• The red line in the bottom panel represents the percentage of S&P 600 stocks with a 50-day moving average greater than their 200-day moving average.

The Takeaway: When we look beneath the surface, it's evident that most stocks are in downtrends.

Only 38% of S&P 500 stocks are experiencing uptrends, while just 29%...

Today's number is... 43

There have been 43 consecutive days in which the number of 52-week new lows on the NYSE and NASDAQ has exceeded the number of 52-week new highs.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel is the S&P 500 index price.
• The green and red lines in the middle panel is the NYSE + NASDAQ 52-week new highs minus 52-week new lows.
• The red shading in the bottom panel shows the consecutive days NYSE + NASDAQ 52-week new lows > 52-week new highs.

The Takeaway:When this downtrend is ready to reverse, we will notice a sharp decline in new lows, followed by a gradual increase in new highs. 

The Bulls completed the first stage of finding a bottom. Stocks must first stop declining, as we have witnessed a collapse in new lows. However, we have not yet seen any meaningful movement in the second stage, which is the gradual expansion of new highs.

Over the past 43 days, it still remains that there are more...

Today's number is... 52

The relative ratio of the S&P 500 Index versus the S&P 500 Consumer Staples sector has reached a fresh 52-week low.

Here’s the chart:

Let's break down what the chart shows:

• The black line in the top panel shows the relative ratio of S&P 500 Index versus the S&P 500 Consumer Staples.
• The red line is the 200-day moving average of the relative ratio.
• The blue line is the 50-day moving average of the relative ratio.

The Takeaway: In healthy bull markets, this ratio typically moves up and to the right on the chart. 

Right now it's moving lower! 

There’s no other way to put it—market participants are positioning themselves defensively… They are not seeking risk.

This defensive rotation has been steadily increasing since late January, and the current landscape is risk-off. 

This is perfectly normal behavior in a weak market.

Let me break down what I am seeing in the chart:

- The ratio has reached a new 52...

Today's number is... 24.5

The average bulls have fallen to 24.5, the lowest level since the lows of the ‘cost of living crisis’ in October 2022.

Here’s the chart:

 Let's break down what the chart shows:

• The blue line in the top panel represents the price of the S&P 500 index.
• The green line in the middle panel shows the average bulls from the Investors Intelligence (II) and the American Association of Individual Investors (AAII).
• The red line in the bottom panel shows the average bears from the II and the AAII.

The Takeaway: You need bulls in bull markets to buy stocks...That's just math.

And today we're seeing the opposite of that.

The average number of bulls has dropped to its lowest level since October 2022, while the average number of bears has reached its highest level since that same month.

This tells me that optimism in the market has vanished, and the recent volatility has really led to a notable level of pessimism.

With bullish sentiment at such low levels and bearish...

Today's number is... 10

The relative ratio of the World Ex-US index versus the S&P 500 has made a 10-month high.

Here’s the chart:

Let's break down what the chart shows:

• The black line shows the relative ratio of World Ex-US (VEU) versus the S&P 500 Index (SPY).

The Takeaway: While the focus in the US is on Trump and his tariffs, the rest of the world is moving higher! 

The relative ratio of the World Ex-US index vs the S&P 500 has broken out and is reaching 10-month highs. 

Last month, I shared a note outlining the key changes I observed in the ratio between the World Ex-US index vs the S&P 500. At that time, there wasn't enough evidence to confirm a change in trend.  

However, I can now confirm that a trend...

Today's number is... 16

My sentiment composite hits a fresh 16-month high. 

Here’s the chart:

Let's break down what the chart shows:

• The black line in the top panel represents the price of the S&P 500 index.
• The black line in the bottom panel represents my sentiment composite, which includes six different sentiment data points: AAII Bull Bear Spread, II Bull Bear Spread, NAAIM, CBOE Volatility Index, Equity Put Call Ratio 5-Day, and Put Call Ratio 10-Day.

The Takeaway: We are currently seeing more bears than bulls enter the market, as my sentiment composite has reached a new 16-month high. It's remarkable how price action can influence sentiment. Just six months ago, we were experiencing optimism, but now the environment for investors has turned much more pessimistic.

While I acknowledge that this sentiment composite is not perfect, it does provide a useful perspective on what investors are thinking at the moment. 

The way I use sentiment is to determine whether it acts as a potential tailwind...

Today's number is... 50%

More than 50% of stocks listed on the NYSE reached 52-week lows last week.

Here’s the chart:

Let's break down what the chart shows:

• The black line in the top panel is the S&P 500 index price.
• The red lines in the bottom panel show the percentage of NYSE stocks making 52-Week New Lows.

The Takeaway: The stock market can only decline with an expansion in the new lows list, it's simple math… and you know what… The number of stocks making new lows expanded to its fourth-highest level over the past 17 years.

That's expansion!

No two ways about it…

Last week, among the 2,862 stocks listed on the NYSE, 1,475 made new 52-week lows…

That's over half of the stocks that are listed on the NYSE exchange! 

These are not levels you see during a bull market.

Moving forward from here, the Bulls must first stop stocks from declining. They have been trying to put something together, but have yet to show any type of back-to-back follow-through just yet. 

Is there...

Today's number is... 42nd

The 10-week moving average of the S&P 500 has fallen below the 40-week moving average for the 42nd time since 1950.

Here’s the chart:

Let's break down what the chart shows:

• The black line is the S&P 500 index price.
• The blue line is the 10-week moving average of the S&P 500 index price.
• The red line is the 40-week moving average of the S&P 500 index price.
• The gray lines highlight when the 10-week moving average crosses below the 40-week moving average - Also known as a Death Cross.
• The table showcases the forward returns of the S&P 500 following a Death Cross.

The Takeaway: The trend is your friend until it bends, and the S&P 500 has been in an uptrend for the past 115 weeks.

But that changed last week when the S&P 500 experienced a Death Cross, which adds to the evidence in favor of Bears.

But what exactly is a Death Cross?

A Death Cross is a technical indicator that occurs when a short-term moving...

Today's number is... 0.09

The St. Louis Fed Financial Stress Index has risen above the zero line, increasing to 0.09.

Here’s the chart:

Let's break down what the chart shows:

• The blue line represents the price of the S&P 500 index.
• The green/red line represents the St. Louis Fed Financial Stress Index. When the line is green, it indicates that financial market stress is lower than normal. Conversely, when the line is red, it indicates that financial market stress is higher than normal.
• The St. Louis Fed Financial Stress Index measures financial stress in markets and is published by the Federal Reserve Bank of St. Louis. This index is constructed from 18 weekly data series: seven interest rate series, six yield spreads, and five other indicators. Each of these components provides insights into different aspects of financial stress.

The Takeaway: Here is another data point for the bears…

The St. Louis Fed Financial Stress Index has reached its highest level of market stress...

Today's number is... 3rd

Yesterday's daily move of +9.5% for the S&P 500 was its third-best day going all the way back to the 1950s.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel is the S&P 500 index price.
• The green & red lines in the bottom panel is the daily percentage change.
• The table showcases the forward returns for the top 20 best days for the S&P 500.

The Takeaway: If you have been following my daily notes this week, you would have seen on Monday that I noted that a massive back-to-back price drop could indicate that we had reached a market bottom. On...

Today's number is... 50%

More than 50% of the stocks in the S&P 500 are currently in oversold conditions.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel is the S&P 500 index price.
• The black line in the bottom panel is the percentage of S&P 500 stocks oversold (Daily RSI14 less than 30) 
• The gray lines indicate when the percentage of S&P 500 stocks oversold crosses above 50.

The Takeaway: The recent environment has not encouraged risk-seeking behavior. We have now entered a phase where many risk assets have broken lower from topping formations and are now retesting prior cycle highs.

When we take a look under the hood, we find that over 50% of the stocks in the S&P 500 are now oversold (Daily RSI falling below 30). This level of oversold conditions has not been seen since the market crash of 2020.

So, I dug into the data to see what typically happens to the market when the majority of S&P 500 stocks become...