As of late this afternoon, just 26% of stocks in the S&P 500 were trading above their 50-day moving averages.  As shown in the one-year chart of this breadth indicator below, this is close but not quite down to the lows reached during the August market swoon.

Breadth levels actually got very strong during the October and November market rally.  In the first half of 2015, you can see in the chart that breadth got weaker and weaker, making lower highs each time.  This weakness in breadth came as the S&P itself was trending sideways, which is negative divergence.  We all know what eventually happened to the market in August…

spx50d

Below are breadth charts for the ten S&P 500 sectors.  There are currently four sectors that have readings weaker than the S&P 500’s reading of 26% — Financials, Consumer Discretionary, Utilities and Energy.  Energy is at a big fat goose egg right now — that’s right, not one stock in the Energy sector is currently above its 50-day.  Looking on the bright side, it can’t get any worse from here!

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matr50d

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