Will The U.S. Stock Market’s Worsening Breadth Matter?

US stock market breadth is fading

The US stock market has bad breadth, as participation thins out markedly. Below are a few examples.

Equal weight is fading into the headline per this chart. 

RSP SPY Ratio

new highs/lows are diverging the headline as well.

SPX Large Cap Index Highs And Lows

Let’s also take a look at the thinning out going on in big as the headline powers higher.

NASDAQ 100

Now take a look at the disgusting charts of and . They are technically in roll over mode as long as they remain below the daily SMA 50 (blue), which is also starting to roll over.

The big names that everyone knows are doing the lifting, and that is not positive. It’s man and machine rotating into the perceived safety of the biggest of big Tech. Side note: I recently sold and (while hanging on to for now) because this is late stage signaling.

S&P Midcap Chart
S&P Small Cap Chart

Sure, the Teflon Don (aka the US stock market) could escape unscathed as it sometimes does after painting such obvious bearish divergences. But that does not mean the divergences are not there and have not in the past foretold bearish things to come. Add to that thin summer trading and if you’re not having at least some level of caution, you’re a braver person than I.

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