The Warning Signal That Could Break The Entire Stock Market

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Most stocks are actually in a bear market right now, but you wouldn’t know it from looking at the S&P 500 or Nasdaq. You see at least 41% of the S&P 500 is down at least 20% from its most recent all-time high. This shouldn’t be a shock, because we have been noting how the internals of the US stock market started to go into decline several weeks ago in recent updates.

Less than 40% of the stocks that trade on the NYSE are above their 200-day moving averages, with a rapid disintegration in the number towards the end of August, worsening as bond yields continued higher.