Today's number is... 38.8

Bearish market sentiment continues to rise, with our Average Bears indicator reaching 38.8 last week. Meanwhile, the S&P 500 index achieved a weekly all-time high... Things that make you go, hmmm.

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 light red line in the middle panel shows the S&P 500 index 52-week drawdown.
• The dark red line in the bottom panel shows the average bears from the Investors Intelligence (II) and the American Association of Individual Investors (AAII).

The Takeaway: An increasing number of bears have entered the market, this is illustrated by our average bear indicator, which has risen to its highest level since March 2023. Typically, when we see this many bears in the stock market, we are somewhere in the midst of a market drawdown. However, by the close of trading on Friday, the S&P 500 index finished the week at new all-time highs. 

...

Today's number is... 22

The relative ratio of Home Construction vs S&P 500 has fallen to its lowest level in 22 months.

Here’s the chart:

Let's break down what the chart shows:

• The blue line shows the relative ratio of the Home Construction Index $ITB vs S&P 500 $SPY

The Takeaway: One group that has been under selling pressure lately has been Home Construction, and we can highlight this weakness in a relative ratio versus the broader market.

Home Construction is one of the most crucial industry groups in America, as these stocks are highly cyclical. They act as an excellent gauge for growth and often act as a leading indicator for the broader market. 

Typically, when home construction stocks are trending higher, it's happening in an environment conducive to risk-seeking behavior. Right now, that is not the case, as this relative ratio is at its lowest level in 22 months. 

This does not bode well for risk assets, and if we're really in an environment where risk assets are trending higher and bulls are in control,...

Today's number is... 43

Global participation is expanding, with the majority of the 43 global ETFs I track are now above their shorter-term moving averages.

Here’s the table:

Let's break down what the table shows:

Each row in the table represents a developed or emerging market country ETF. The columns indicate the percentage by which each country is above or below its key moving averages, starting with the 10-day moving average and progressing up to the 200-day moving average.

The Takeaway: The improvement seen over the past few weeks is not just limited to the US. The percentage of global markets moving back above key short-term averages has been increasing throughout 2025, with the leadership primarily coming from the 22 developed markets. While these shorter-term trends have been strengthening beneath the surface, the shift at the index level has only recently begun.

These kinds of improvements in market breadth could establish a strong foundation for a sustained global rally. However, for me to believe that this recent run-up has lasting potential, I need to see the leadership...

Today's number is... 10

10 out of the 11 sectors in the S&P 500 are currently above their 50-day moving average.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel shows the price of the S&P 500 index.
• The black line in the bottom panel shows the number of S&P 500 sectors above their 50-day Average.

The Takeaway: In early January of this year, all sectors were below their 50-day moving average. However, over the past 21 trading days, this breadth reading has steadily improved, with 10 out of the 11 sectors now above their 50-day moving averages. This is the highest level we've seen since late November of last year.

The only sector that remains below its 50-day moving average is Consumer Discretionary. This weakness in the Consumer Discretionary sector can be largely attributed to the decline of Tesla, which has recently experienced a sharp drop in price. 

The S&P 500 typically does not encounter significant challenges when most sectors are above their 50-...

Today's number is... 75%

Currently, 75% (6 out of 8) of the indicators on my 2025 Bull Market Checklist are within their bull market zone. This suggests a healthy-ish bull market, creating a favorable backdrop for stocks.

Here is the table:

About the Table: This checklist combines various factors such as price, trends, momentum, breadth, sentiment & environmental models. Its purpose is to highlight turns toward risks or opportunities in the market.

This checklist was created to have a bird’s eye view rather than focusing on just one area of the market.

This high-level perspective will guide us in understanding the current market environment before allocating capital.

Please note that this checklist is not intended to serve as a trading signal; rather, it functions as a gauge of the current trading environment.

The Takeaway: The bulls appear to be re-entering the market to regain control. This week, my checklist has progressed further into the bullish zone, with the percentage of global markets moving above their 50-day average...

Today's number is... 3

Let's check in on how the third year of this bull market is progressing.

Here’s the chart:

Let's break down what the chart shows:

• The light blue line represents the performance of an average first year during a bull market for the S&P 500. The dark blue line illustrates the performance of the first year of the current bull market for the S&P 500.
• The light gray line indicates the performance of an average second year within a bull market for the S&P 500, while the dark gray line shows the performance of the second year of the current bull market.
• The light red line indicates the performance of an average third year during a bull market for the S&P 500, and the dark red line represents the performance of the third year of the current bull market for the S&P 500.

The Takeaway: Let's start by clarifying how I define a bull market: 

A bull market is a 20% or more rally preceded by a -20...

Today's number is... 250

The old saying is it's a market of stocks, not a stock market, and so far in 2025, we are seeing 250 stocks outperforming the S&P 500 index.

Here’s the chart:

Let's break down what the chart shows:

• The dark blue bars represent the year-to-date returns of each S&P 500 stock.
• The light blue bar indicates the average year-to-date return of S&P 500 stocks.
• The yellow bar represents the S&P 500 index year-to-date return.

The Takeaway: The S&P 500 index has increased by 3.45% this year, but currently, 250 stocks are outperforming it... That's half of the index components!

When we take a look at the year-to-date return data of the S&P 500 stocks, we can see that a total of 331 stocks have recorded positive returns so far this year, whereas only 172 stocks have experienced negative returns during the same period.

Given the recent increase in volatility, these figures actually reflect solid performance.

Although the new high breadth data isn'...

Today's number is... 517

The Equal Weight Consumer Discretionary vs Equal Weight Consumer Staples relative ratio has been in an uptrend for the past 517 trading days.

Here’s the chart:

Let's break down what the chart shows:

• The black line in the top panel represents Equal Weight Consumer Discretionary vs Equal Weight Consumer Staples relative ratio (If the ratio rises, discretionary stocks are outperforming staples; if it falls, staples are outperforming discretionary stocks.)
• The blue line in the top panel represents the 50-day moving average, while the red line represents the 200-day moving average.
• The black bars in the bottom panel indicate the consecutive days when the 50-day average is greater than the 200-day average.

The Takeaway: If you've been following me, you probably already know that I define an uptrend as when the 50-day moving average is above the 200-day moving average. I like to keep things simple and avoid complicating things.

This ratio is one of my favorite Risk-On/Risk-...

Today's number is... -0.98

The St. Louis Fed Financial Stress Index has declined to -0.98, the lowest level this market stress index has seen in over 17 years.

Here’s the chart:

(right-click and open image in new tab to zoom in)

Let's break down what the chart shows:

• The blue line represents the price of the S&P 500 index.
• The green and red line represent the St. Louis Fed Financial Stress Index (This data set has been inverted). 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 gray line represents the zero line for the St. Louis Fed Financial Stress Index, indicating normal financial market conditions.

The Takeaway: 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...

Today's number is... 2

February, the 2nd month of the year, usually sees stocks perform well in the first half but often declines in the latter half of the month.

Here’s the chart:

Let's break down what the chart shows:

This blue line represents the average return for February since 1950 for the S&P 500.

The Takeaway: February, on average, usually starts off positive, but the S&P 500 tends to decline shortly after Valentine's Day. On average, the month finishes relatively flat, with only 48% of days experiencing positive daily gains. 

February is regarded as the second worst month of the year in terms of seasonality. Over the past decade, only 50% of February's have ended on a positive note. When we look at a longer time frame, the trend doesn't improve much; in the last two decades, just 60% of Februarys have finished with overall gains.

This type of choppy market action aligns well with other cycles we track. Typically, ...

Today's number is... 2.70%

The January Barometer (January's percentage change for the S&P 500) for 2025 showed a positive return of 2.70%.

Here’s the data table:

Let's break down what the table shows:

The first column lists the years the S&P 500 experienced a positive gain. The second column indicates the percentage change for January. The third column represents the percentage change from February to December. The fourth column shows the overall full-year return. At the bottom is a statistical table for each of these columns.

The Takeaway: The saying goes, "As January goes, so goes the rest of the Year."

The January Barometer is a seasonality tool that suggests that January's returns may predict the rest of the year's performance.

This seasonal analysis tool was initially introduced by Stock Trader's Almanac.

Let's...

Today's number is... 12

The percentage of S&P 500 stocks reaching 12-month highs is now at its highest level since November of last year.

Here’s the chart:

(right-click and open image in new tab to zoom in)

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 percentage of S&P 500 stocks making 12-month highs.

The Takeaway: Breadth continues to improve, although the S&P 500 is currently down 0.49% week-to-date, when you look under the hood, you can see that 12-month highs are expanding and have reached their highest level in over two months.

This is called participation… which is a necessary condition for any bull market, and the current bulls have consistently demonstrated their resilience and strength.

The stock market can only decline with an expansion in the new lows list, and the percentage of S&P 500 stocks hitting new lows across all time...